Residential heat pump subsidies across Europe

“Since the investment costs for low-carbon heating and cooling systems such as heat pumps are still higher than for fossil fuel-based heating devices, financial support schemes are still necessary to remove the barriers to investment,” the European Heat Pump Association (EHPA) says in a new report on subsidies for residential heat pumps in Europe.

The overview covers air– and ground-source residential heat pumps, as well as hybrid and domestic hot water heat pumps. The EHPA collected data for the United Kingdom, Norway, Switzerland, and some EU member states. It excluded Bulgaria, Estonia, Cyprus, Greece, Romania, Malta, Slovenia, Luxembourg, and Latvia, which were left out because “they have a small market, or their current programs are suspended,” said the association.

The following subsidies are for single-family homes, unless otherwise stated.

Austria offers a grant for air- and ground-source heat pumps installed in new buildings of up to 20% of their price. The grant has a maximum value of €7,500 ($8,075) if the global warming potential (GWP) of the heat pump is between 1,500 and 2,000. For retrofit installations, the grant covers up to 35% of the cost to a maximum of 5,000. The subsidy is in place from Jan. 3, 2023, to Dec. 31, 2024.

In Belgium, grants are only available for retrofit installations and values vary greatly across the country’s regions as well as heat pump technology. In Flanders, ground-source heat pumps are subsidized between €4,000 and €6,400, while in Brussels air-source heat pumps are eligible for up to €4,750.

Croatia gives out grants for retrofit projects once to twice a year, of a maximum of €4,250 and up to 40% of the cost for domestic hot water heat pumps as well as air- and ground-source. The subsidy is higher in poorer regions, and installation and auxiliary components costs are eligible for support.

The Czech Republic restarted its “New Green Savings” program as of February 2023, with grants for retrofit installations of up to €5,701.

Denmark’s incentive scheme is in place between 2020 and 2026 and offers grants for both new buildings and renovation projects. The subsidy for air-source heat pumps is up to €3,338 and up to €4,772.9 for ground-source pumps.

Finland offers both grants and tax deductions across heat pump technologies and installation types. The grant is up to €4,000 and 40% to 60% of costs are also tax deductible.

In France, those who purchase ground-source heat pumps for existing properties can get a grant of up to €15,000 and up to €9,000 for air-source heat pumps. The scheme is in place from 2020 to 2024.

In Germany, air-source heat pumps for retrofit installations are eligible for up to €15,000 and up to €18,000 until 2030.

In Hungary, heat pumps are covered under a general subsidy scheme that covers 50% or up to €7,300 of renovation costs.

Since 2021, Ireland has granted €3,500 for air-to-air heat pumps for all house types, and €4,500 for air-to-water and ground-source heat pumps in apartments. The subsidy for both solutions in all other house types is €6,500.

Italy has three tax benefits programs in place for renovation projects, covering between 50% to 110% of heat pump costs.

Lithuania gives grants of up to €14,500 for heat pumps in both new buildings and renovations.

The Netherlands offers grants for retrofit installations, of up to €3,750 for air-source heat pumps, €5,100 for ground-source, and €3,000 for hybrid heat pumps. In 2023, the subsidies have been extended beyond systems with 70 kW heating capacity to a maximum of 400 kW.

Norway only gives grants for ground-source heat pumps, of up to €1,000 for both new buildings and renovations.

Poland, which tops the list for most heat pumps sold in Europe in 2022, has four different incentive programs for heat pumps. The “My Electricity” scheme offers grants of up to €1,060 for air-source heat and domestic hot water heat pumps when combined with a PV system and storage.

In Portugal, a scheme in place since 2022 reimburses up to 85% of the cost of heat pump installations in new buildings and renovations, up to a maximum of €2,500 excluding VAT.

Slovakia offers up to €3,400 in grants for heat pumps installed in new buildings, and up to €11,400 in renovation projects.

Spain’s incentive programs include grants for buildings connected to district heating exclusively using heat pumps at the energy center. The subsidy is €2,070/kW and up to 70% of the investment for new buildings in not-for-profit energy communities.

Sweden offers 30% tax rebates on labor costs of retrofit installations, up to €5,000 a year.

Five Swiss counties have varied incentive schemes, from subsidies up to €22,320 for replacing an electric heater with a ground-source heat pump in a renovation project in Vaud, to up to €3,043 for an air-source heat pump in a new single-family house in Geneva.

The United Kingdom offers grants of GBP 5,000 (€5,804) for air-source heat pumps and of GBP 6,000 for ground-source heat pumps, for both new buildings and retrofits.