District Heating Market Size – By Application (Residential, Commercial {College/University, Office Buildings, Government/Military}, Industrial {Chemical, Refinery, Paper}), By Source, By Regional Outlook & Forecast, 2024 – 2032

District Heating Market Size

District Heating Market was valued at USD 178.5 billion in 2023 and is projected to grow at a CAGR of 6.2% between 2024 and 2032. The growing emphasis on reducing carbon emissions in line with integration of renewable energy sources will foster the industry landscape. Rapid expansion of industrialization and urbanization growth along with surging demand for efficient & sustainable heating solutions will energize the business growth.
 

A district heating is a system that provides heat for residential, commercial, and industrial spaces from a central source through a network of insulated pipes. Supportive government policies, incentives programs, and subsidies for energy efficient along with increasing awareness toward climate change will foster the business overview. Increasing investment in technological advancements including heat generation and distribution capabilities combined with refurbishment of smart grid & energy storage solutions will proliferate the demand for district heating & cooling products.
 

District Heating Market Trends

The industry will witness significant growth owing to their reduced maintenance cost and improved energy efficiency. These systems enhance energy security by diversifying the energy mix and reducing dependence on imported fossil fuels, which in turn will positively influence the market penetration. In addition, growing energy demand across urban areas coupled with paradigm shift toward adoption of sustainable heating solutions will propel the deployment of these units.
 

District Heating Market Analysis

The CHP district heating industry size will exceed USD 145 billion by 2032, on account of their high sustainability and enhanced energy supply efficiency. Stringent government regulations pertaining to decarbonization of buildings along with the growing adoption of energy-efficient and clean technologies will complement the product deployment. Moreover, focused government policy toward heat and electricity supply coupled with well-implemented policy intervention will energize the industry potential.
 

The commercial district heating market size will observe a notable growth of over 6% through 2032. Ongoing expansion & development of IT parks and data centers in line with the introduction of several stringent building emission norms will accelerate the product penetration. Growing integration of building energy management systems to provide control and real time monitoring of heating systems in conjunction with optimization of energy consumption will fuel the industry scenario. Moreover, burgeoning adoption of renewable energy comprising of smart technologies, waste heat recovery, and CHP in line with surging urban populations will foster the business dynamics.
 

Asia Pacific district heating market is set to surpass USD 160 billion by 2032. The region is observing significant growth owing to increasing investments by key public and private players toward infrastructural development. Paradigm shift toward sustainable heating systems along with declining surface temperature primarily across the nations has led to the industry growth. Furthermore, the introduction of stringent GHG regulations combined with the rising adoption of renewable energy sources to generate heat and energy will elevate the industry share.
 

U.S. district heating industry is poised for substantial growth on account of the changing climatic conditions and stringent energy security policies. The increasing promotional activities and marketing strategies in line with continuous innovation in advanced control systems and enhanced insulation material will stimulate the industry outlook. Supportive regulatory policies and government funded programs toward DH network coupled with ongoing R&D activities and stringent framework to curb carbon emission will influence the technological adoption.
 

District Heating Market Share

Fortum generates, sells & distributes electricity, heat, steam, as well as operates & maintains power plants. The company operates in various segments including electricity sales, heat, and solutions. Its power segment comprises physical operations, trading, expert services, power generation from wind, thermal, hydro, nuclear operations, and power portfolio optimization. Fortum’s heat segment consists of district heating & cooling activities, combined heat, power generation, and customer-oriented heating solutions.
 

District Heating Market Companies

The key industry players include:

• Alfa Laval
• Fortum
• Göteborg Energi
• Hafslund AS
• Kelag Warme Gmbh
• Keppel Corporation Limited
• Korea District Heating Corporation
• LOGSTOR Denmark Holding ApS
• Ørsted A/S
• Ramboll Group A/S
• RWE
• Shinryo Corporation
• Statkraft AS
• STEAG GmbH
• Vattenfall AB
   

District Heating Industry News

• In March 2024, Hitachi Energy has secured a significant contract to provide grid connection solutions in Finland for the world’s largest data center heat recovery initiative. This project involves recovering and repurposing excess heat from data centers to heat various premises belonging to Fortum, including homes, public facilities, and businesses. Fortum, a prominent Nordic energy company, has chosen Hitachi Energy to supply advanced grid connection solutions. This technology will facilitate the replacement of fossil fuels with sustainable, emission-free energy sources within Helsinki’s district heating infrastructure.
   
• In March 2024, Fortum has announced to develop a new emissions-free and electricity-based district heating production facility in the Nuijala area of Espoo, Finland. The facility will feature a 50 MW electric boiler and an 800 MWhr heat accumulator. This electric boiler and heat storage combination will enhance the flexibility of heat production and stabilize electricity demand by utilizing time-variable electricity pricing. Construction is slated to commence this spring, with production expected to begin in the 2025-2026 heating season.
   

This district heating market research report includes in-depth coverage of the industry with estimates & forecast in terms of “PJ” & “USD Billion” from 2021 to 2032, for the following segments:

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Market, By Source

• CHP
• Geothermal
• Solar
• Heat only boiler
• Other

Market, By Application

• Residential
• Commercial
  • College/University
  • Office
  • Government/Military
  • Others
• Industrial
  • Chemical
  • Refinery
  • Paper
  • Others

The above information has been provided for the following regions and countries:

• North America
  • U.S.
  • Canada
• Europe
  • Germany
  • Poland
  • Russia
  • Sweden
  • Finland
  • Italy
  • Denmark
  • UK
  • Slovakia
  • Austria
  • Czech Republic
  • France
• Asia Pacific
  • China
  • Japan
  • South Korea