The climate targets require a shift away from fossil fuels in the building sector and a switch to CO2-neutral alternatives. Heat pumps can meet these requirements, but in practice there are still some hurdles to overcome. Discussions on this technology with a focus on the development in Germany.
Since the extensive discussion concerning the tightening of the Buildings Energy Act (Gebäudeenergiegesetz, GEG), alternative systems for heating and hot water supplies have also hit home among the general public in Germany. In Europe, the transition to climate-friendly heating technologies has already progressed to varying degrees and is heavily dependent on the commitment of the respective government to climate protection. In Denmark, for example, oil and gas heating in new buildings has been banned since 2013 and in France since 2020, which is associated with a corresponding increase in non-fossil heating systems, especially heat pumps. The Nordic countries are the leaders in Europe in the use of this technology, while Germany is one of the stragglers.
As well as heat pumps, various other technologies also offer a suitable alternative for the heating of buildings, such as wood or pellet heating. However, these involve the emission of CO2 and fine dust. Another possibility is the use of district heating. However, this requires a local grid connection and heat-generating industrial or power plants (including CO2 neutrality in the long term). Heat pumps, by contrast, offer maximum flexibility and availability, especially since various media such as air, water and geothermal energy can be used as “energy sources”. The technology offers plants for use in single and multi-family dwellings up to local power plants that are fed with heat from rivers or lakes or are capable of using geothermal energy (this is the way to district heating).
Air-to-water heat pumps are most widely used
Private owners and real estate investors concentrating on multi-family dwellings focus on smaller and medium-sized heat pumps. As the sales figures for Germany in recent years show, they largely draw on the universally available medium air.
Air-to-water heat pumps are not optimal from a technical and economic point of view because their efficiency decreases significantly at low outside air temperatures. On the other hand, the installation of heat pumps that use groundwater or geothermal heat and thus a source with a constant temperature is often not feasible for individual properties, especially in densely populated urban areas. There is no space for drilling, and the building structure or infrastructure can also be damaged. This is compounded by fundamentally high costs and time-consuming investigations of the soil/rock quality for (deep) drilling.
CO2-neutral heating possible
Regardless of the heat source used, heat pumps are clearly attractive due to their CO2 neutrality in operation – provided that the electricity required for them is generated with renewable energies and the refrigerant used also has a low global warming potential. Heat pumps can be easily combined with photovoltaic systems in order to consume the electricity generated directly. As a result, at least in Germany, a PV system pays off more quickly than when it is fed into the public grid.
At first glance, the high acquisition costs of the equipment seem less attractive compared to the fossil fuel heating systems used so far. However, extensive state subsidies for installation (currently up to 40% of the costs in Germany) serve to minimise the expenses. In the long run, maintenance and operating costs are also lower than for fossil fuel heating systems. There are also subsidies and special electricity tariffs offered by many energy suppliers. By contrast, fossil fuels are set to become considerably more expensive in the coming years due to CO2 pricing, making heat pumps the more cost-effective option over the entire lifetime of a plant.
Improvements in technology, grid and regulations needed
Some drawbacks and limitations of a heat pump lie not so much in the economic (profitability) as in the technical field of everyday use. According to the current state of the art, heat pumps can be used in many properties all year round as the sole source of heating and hot water. However, in buildings with a high heat requirement, such as in (historic) old buildings, the devices cannot cope with peak loads as primary heat generators on very cold days. These require either (supplementary) all-electric heating or an additional heat source (e.g. biomass) must be kept in reserve.
Noise emissions are also disruptive, especially in densely populated urban areas. Noise-reducing or noise-preventing construction measures are required here. In older buildings, the insulation of exterior walls and pipes may need to be improved before a heat pump can even be operated economically.
Finally, it should be noted that the capacities in the German electricity grid are currently insufficient and regarded as a general problem of increasing electrification. Heat pumps cannot therefore be used on a large scale without causing power outages. This is therefore all the more reason for swiftly expanding the grids for a secure power supply, even if this takes as much time as mass installation of heat pumps due to the shortage of skilled workers.
Swiss Life Asset Managers in Germany focuses on heat pumps for decarbonisation
The environmental and economic benefits, as well as the regulatory framework conditions, make heat pumps a key component when it comes to decarbonising the building stock. Swiss Life Asset Managers is therefore gradually replacing fossil-fuelled heating systems in existing properties. A review is carried out in each case to determine whether an exclusive supply from a heat pump is possible or whether the building fabric, especially in multi-family dwellings, calls for a combination with secondary gas-fired supplementary heating to ensure the security of supply for tenants. It is important in the case of such combinations to ensure that at least 65% is covered by renewable energies as envisaged by the planned GEG reform from January 2024.
The situation for own project developments is clearer: district heating is generally used for the construction of new residential and office buildings in large cities. Large-scale logistics properties, which are predominantly located outside core cities, use heat pumps, photovoltaic systems and energy storage systems to generate energy.
Technological progress will further increase the efficiency and application possibilities of heat pumps in the future. Similarly, a massive expansion of renewable energies and power lines is to be expected in the longer term. However, the legislator will also have to take action: the regulations governing noise emissions and distance requirements need to be adapted in order to achieve a widespread use of heat pumps without unduly impairing the quality of life of residents. In the long term, heat pumps will establish themselves as an efficient solution for CO2-neutral heat supply.
