Key highlights
- 1The Asia Pacific industrial heat pump market is expected to reach USD 1.52 billion by 2036, at a CAGR of 9.8% from 2026 to 2036, driven by industrial decarbonisation, energy efficiency, and high-temperature heat pump adoption.
- 2Process heat is the opportunity. Industries dependent on low-temperature heat and steam account for roughly 70% of global industrial energy consumption, and the "missing middle" of process heat and steam above 100 degrees Celsius, where boilers dominate, is the core opportunity for heat pumps.
- 3China leads the region. China's decarbonisation drive has made it the dominant regional market, and the country accounts for roughly one-third of global heat consumption, supporting large-scale industrial heat pump deployment.
- 4Japan leads the technology. Kobe Steel's Steam Grow Heat Pump supplies steam at 120 to 165 degrees Celsius, a world-first when commercialised, with a coefficient of performance around 2.5, and Mayekawa, Daikin, Panasonic and Mitsubishi offer deep heat-pump capability.
- 5High-temperature heat pumps are maturing. The IEA projects high-temperature heat pumps to become a preferred industrial process-heating technology by 2026, with systems up to about 120 degrees Celsius commercialising and 160 degrees and above still in demonstration.
- 6Efficiency and waste heat drive value. Heat pumps recover waste heat from factory effluent and deliver heat at a coefficient of performance well above one, and industrial loads running 6,000 to 8,000 hours per year improve payback.
- 7Key companies include Kobe Steel, Ltd. (Kobelco), Mayekawa Mfg. Co., Ltd., Mitsubishi Heavy Industries, Ltd., Daikin Industries, Ltd., and GEA Group AG.
Report Overview
The Asia Pacific industrial heat pump market covers heat pumps that supply industrial process heat and steam, spanning low-, medium- and high-temperature systems, natural and synthetic refrigerants, and waste-heat, air, water and ground heat sources, for food and beverage, chemicals, pulp and paper, pharmaceuticals, textiles, district heating and other industries. Residential and commercial space-heating heat pumps are outside the scope except where industrial. The market is central to decarbonising the low-temperature process heat that makes up most industrial energy use, and is scaling as high-temperature heat pumps mature. Demand is shaped by decarbonisation and electrification, energy cost, and technology. This report examines the size, drivers, temperature ranges, applications, heat sources, countries, pricing, competition, recent developments, and outlook of the market, and provides recommendations. Sizing is built bottom-up from industrial heat pump equipment and installations by temperature range, application and country, and reflects industrial heat pumps deployed in Asia Pacific.
Market dynamics
Drivers
- 01Decarbonisation and electrification are the primary driver as net-zero targets across China, Japan, South Korea and Australia push industry to electrify process heat, and heat pumps can supply much of the low-temperature heat and steam that account for roughly 70% of global industrial energy use, addressing the "missing middle" above 100 degrees Celsius where boilers dominate.
- 02Energy cost and efficiency are a driver as heat pumps recover waste heat and deliver heat at a coefficient of performance well above one, cutting fuel use, and industrial loads running 6,000 to 8,000 hours per year improve the economics.
- 03The maturation of high-temperature heat pumps is a driver of addressable demand, as systems such as Kobe Steel's Steam Grow Heat Pump supply steam up to 165 degrees Celsius, and the IEA projects high-temperature heat pumps to become a preferred process-heating technology by 2026.
Opportunities
- 01High-temperature heat pumps and steam generation are the leading opportunity, because supplying steam and process heat above 100 degrees Celsius replaces fossil boilers in a large share of industrial energy, and systems reaching 120 to 165 degrees, with higher temperatures in development, expand the addressable range.
- 02Waste-heat recovery integration is an opportunity as heat pumps upgrade low-grade waste heat from factory effluent into useful process heat, improving efficiency and payback.
- 03Food beverage and chemical process heat is an opportunity, as these industries use large amounts of drying, pasteurisation, evaporation, concentration and distillation heat suited to heat pumps.
Trends
- 01The commercialisation of high-temperature heat pumps is the defining trend, as systems supplying steam up to 165 degrees Celsius move from pilots toward commercial industrial use and higher temperatures advance in demonstration.
- 02Adoption of natural refrigerants such as ammonia and carbon dioxide is a trend, driven by environmental regulation and performance, with suppliers such as Mayekawa offering ammonia and carbon dioxide heat pumps.
- 03Waste-heat-driven systems are a trend as heat pumps recover and upgrade factory waste heat.
- 04China-led deployment is a regional trend reflecting the country's decarbonisation drive and manufacturing scale.
Report Summary
| Base Year | 2025 |
|---|---|
| Forecast Period | 2026-2036 |
| Market Size (2025) | USD 540 million |
| Market Size (2026) | USD 595 million |
| Market Size (2036) | USD 1.52 billion |
| CAGR (Value) | 9.8% (2026-2036) |
| Format | PDF & Excel |
| Segments Covered | By Temperature Range: Low (up to 90C), Medium (90-160C), High (>160C). By Application:Food & Beverage, Chemicals, Pulp & Paper, Pharmaceuticals, Textiles, District Heating, Others. By Heat Source; By Country. |
| Geographies Covered | China, Japan, South Korea, India, Australia, and Rest of Asia Pacific |
| Key Companies | Kobe Steel, Ltd. (Kobelco), Mayekawa Mfg. Co., Ltd., Mitsubishi Heavy Industries, Ltd., Daikin Industries, Ltd., Panasonic Corporation, GEA Group AG, Johnson Controls International, MAN Energy Solutions, BROAD Group, Guangdong Phnix Eco-energy Solution, Other Companies |
Segmental analysis
By Temperature Range
- Medium-temperature heat pumps hold the largest share at about 45% of the market in 2026, with the remaining share divided across low-temperature and high-temperature systems.
- Medium-temperature heat pumps are the largest because they supply the process heat and steam between about 90 and 160 degrees that many industries require, addressing the "missing middle" above 100 degrees, and systems such as Kobe Steel's Steam Grow Heat Pump reach 120 to 165 degrees.
- Low-temperature heat pumps up to about 90 degrees serve water heating space heating and lower-temperature processes and have the largest installed base.
- High-temperature heat pumps above 160 degrees are emerging with many still in demonstration, and represent the frontier of the market.
The position of medium-temperature reflects the concentration of process-heat demand and the commercialisation of steam-supplying heat pumps.
By Application
- Food and beverage holds the largest share at about 35% of the market in 2026, with the remaining share divided across chemicals, pulp and paper, pharmaceuticals, textiles, district heating and others.
- Food and beverage is the leading application because the industry uses large amounts of pasteurisation, drying, evaporation and concentration heat at temperatures well suited to heat pumps, and heat pumps recover heat from process effluent.
- Chemicals use heat pumps for distillation concentration and process heat.
- Pulp and paper use them for drying.
- Pharmaceuticals use them for sterilisation and process heat and textiles for drying and dyeing.
- District heating uses large heat pumps.
The dominance of food and beverage reflects its large, temperature-appropriate heat demand and long operating hours.
By Heat Source
- Waste-heat recovery holds the largest share at about 50% of the market in 2026, with the remaining share divided across air, water and ground sources.
- Waste-heat recovery is the leading heat source because industrial heat pumps most often upgrade low-grade waste heat from factory effluent, cooling water and exhaust into useful process heat, which maximises efficiency and payback and is central to the industrial value proposition.
- Air-source heat pumps draw heat from ambient air where waste heat is limited.
- Water-source heat pumps use process or natural water.
- Ground-source heat pumps use geothermal loops with China deploying geothermal-loop systems.
The dominance of waste-heat recovery reflects the efficiency gains from upgrading heat that would otherwise be lost.
Geographic analysis
China Industrial Heat Pump Market
China is the largest market in the region driven by its decarbonisation targets and manufacturing scale, and accounts for roughly one-third of global heat consumption. The country deploys industrial heat pumps across food, chemicals, textiles and district heating, including geothermal-loop systems, and hosts domestic manufacturers such as BROAD Group and Guangdong Phnix. China's dual-carbon goals, industrial base and policy support make it the dominant and fastest-scaling market, and its manufacturing capacity also supplies heat pumps across the region and globally.
Japan Industrial Heat Pump Market
Japan is the region's technology leader home to Kobe Steel's Steam Grow Heat Pump supplying steam at 120 to 165 degrees Celsius, Mayekawa's ammonia and carbon dioxide heat pumps, and Daikin, Panasonic and Mitsubishi's heat-pump capability. Demand is driven by energy efficiency, decarbonisation and high energy costs, and by process industries in food, chemicals and manufacturing. Japan's engineering leadership in high-temperature and natural-refrigerant heat pumps gives it a distinctive role in both its domestic market and exports.
South Korea, India, Australia, and Rest of Asia Pacific
South Korea deploys industrial heat pumps in its manufacturing and process industries under decarbonisation policy. India is a growing, cost-sensitive market with large food, chemical and textile industries and rising interest in efficiency and electrification. Australia uses heat pumps in food processing and dairy, supported by renewable electricity and electrification goals, with Mayekawa active in the market. The rest of Asia Pacific, including Southeast Asia, is an emerging market for food and chemical process heat. These markets add diverse, growing demand across the region's industries.
Pricing Analysis
Pricing in industrial heat pumps reflects capital cost, temperature and capacity, and payback against fuel and electricity prices. Industrial heat pumps are capital-intensive, and higher-temperature and larger-capacity systems cost more, so the investment is weighed against the savings from replacing fossil-fuel boilers. The economics depend on the ratio of electricity to fuel prices, the coefficient of performance, and operating hours, and industrial loads running 6,000 to 8,000 hours per year improve payback. Several factors set economics. Capital cost is central, as heat pumps cost more upfront than gas or steam boilers. Temperature and capacity raise cost, with high-temperature and large systems priced higher. The coefficient of performance, often around 2.5 for steam-supplying systems, determines running-cost savings. Electricity and fuel prices are decisive, as heat pumps are favoured where electricity is cheap relative to fuel and where the grid is low-carbon. Operating hours and waste-heat availability improve payback. Policy and carbon pricing support the economics.
The trajectory of economics depends on technology cost, electricity and fuel prices, and decarbonisation policy, and adoption grows where heat pumps deliver acceptable payback against fossil alternatives.
Competitive landscape
The market is served by Japanese technology leaders, Chinese manufacturers, and global industrial suppliers. Kobe Steel, Ltd. produces the Steam Grow Heat Pump supplying steam up to 165 degrees Celsius, and Mayekawa Mfg. Co., Ltd. offers ammonia and carbon dioxide industrial heat pumps, giving Japan leadership in high-temperature and natural-refrigerant systems. Mitsubishi Heavy Industries, Daikin Industries and Panasonic bring deep heat-pump engineering. Chinese manufacturers such as BROAD Group and Guangdong Phnix Eco-energy supply large volumes for the region's largest market. Global industrial suppliers GEA Group, Johnson Controls and MAN Energy Solutions compete in large industrial and high-temperature heat pumps, and other suppliers serve specific applications and countries.
Competition turns on temperature capability, efficiency, refrigerant and system design, and cost and service, and the region combines Japanese technology leadership, Chinese manufacturing scale and global suppliers. Decarbonisation, high-temperature maturation and energy efficiency favour suppliers that can deliver efficient, high-temperature, natural-refrigerant systems at competitive cost, and Kobe Steel and Mayekawa hold strong technology positions while Chinese manufacturers lead on volume and cost. The field is competitive and growing, and will expand as high-temperature heat pumps mature and industrial decarbonisation accelerates across the region.
Voice of Customer
We use heat pumps to recover waste heat from our processes and supply pasteurisation and drying heat, cutting our gas use and emissions. The efficiency is strong when we have waste heat and long operating hours, and China's decarbonisation policy supports the investment, though the upfront cost and the temperature limit for some steam needs are considerations.
Energy manager, food processing company (China):
For process heat and steam up to around 165 degrees, steam-supplying heat pumps let us electrify heat that used to come from boilers, and recovering heat from our effluent improves the economics. High energy costs and our decarbonisation targets drive this, and Japanese high-temperature systems give us the capability, though reaching higher temperatures is still developing.
Plant engineer, chemical manufacturer (Japan):
Heat pumps fit our food and dairy processing well, and with renewable electricity they cut both cost and emissions. Payback depends on the electricity-to-gas price ratio and our operating hours, and we prioritise waste-heat recovery. As high-temperature systems improve, we can electrify more of our process heat.
Sustainability lead, dairy company (Australia):
Analyst perspective
Asia Pacific's industrial heat pump market is a decarbonisation-driven market that is the largest region for industrial heat pumps, combining China's scale with Japan's technology leadership. The rationale is compelling: industries that rely on low-temperature heat and steam make up roughly 70% of global industrial energy use, and heat pumps can supply much of this electrically at a coefficient of performance well above one by recovering waste heat, addressing the "missing middle" of process heat above 100 degrees where boilers dominate. The technology is maturing, with steam-supplying systems reaching 120 to 165 degrees, exemplified by Kobe Steel's Steam Grow Heat Pump, and the IEA projecting high-temperature heat pumps to become a preferred process-heating technology by 2026. China leads deployment, Japan leads technology, and the region's process industries provide broad demand.
The honest considerations are cost, temperature limits, and electricity economics. Industrial heat pumps are capital-intensive, and payback depends on the ratio of electricity to fuel prices, the coefficient of performance and operating hours, so where fuel is cheap or electricity expensive or high-carbon, the case weakens. The temperature ceiling is a real constraint, as systems above about 160 degrees remain largely in demonstration, so heat pumps address the lower and middle range of process heat rather than the highest temperatures. Adoption has been gradual, and scaling depends on continued technology progress, supportive electricity prices and decarbonisation policy. The market should be assessed on high-temperature technology progress, electricity and fuel economics, and decarbonisation policy rather than on the decarbonisation imperative alone, and the region's scale, technology leadership and policy support solid growth, with cost and temperature capability determining the pace.
Strategic Recommendations
For heat pump manufacturers
The priority is to advance high-temperature capability and efficiency and to lower cost, because the addressable market expands as heat pumps reach higher process-heat temperatures and as payback improves, and decarbonisation of process heat is the central opportunity. Companies should develop systems that reach higher temperatures and supply steam, adopt natural refrigerants such as ammonia and carbon dioxide, optimise for waste-heat recovery, and reduce capital cost. Serving China's scale, leveraging Japanese high-temperature technology, and providing engineering and service across the region strengthen the position.
For industrial users
The recommendation is to adopt heat pumps where waste heat, long operating hours and favourable electricity-to-fuel prices deliver acceptable payback, prioritising waste-heat recovery and matching temperature capability to process needs, and to plan for electrification of process heat as technology and policy advance. For engineering firms, integrating heat pumps with process and waste-heat systems is the key task. For policymakers, decarbonisation targets, carbon pricing, electricity pricing that favours efficient electrification, and incentives support adoption. For investors, this is the largest regional industrial heat pump market, to evaluate on high-temperature technology progress, electricity and fuel economics, and decarbonisation policy rather than on the decarbonisation imperative alone, recognising that the region's scale, Japanese technology leadership and Chinese manufacturing support solid growth while cost and temperature capability remain the key determinants.
Sustainability impact
Decarbonising Process Heat
Industrial heat pumps electrify process heat and steam, replacing fossil-fuel boilers in a large share of industrial energy use.Industrial heat pumps support decarbonisation.
By supplying the low- and medium-temperature process heat that makes up most industrial energy use, heat pumps replace fossil boilers with electric heat, cutting emissions where the electricity is low-carbon and addressing a major source of industrial carbon.
Energy Efficiency and Waste Heat
Heat pumps recover and upgrade waste heat, delivering more heat than the electricity they consume and cutting fuel use.Industrial heat pumps support energy efficiency.
By recovering low-grade waste heat from factory effluent and delivering heat at a coefficient of performance well above one, heat pumps use energy far more efficiently than combustion, reducing both fuel consumption and the waste of heat that would otherwise be lost.
Natural Refrigerants
Industrial heat pumps increasingly use natural refrigerants such as ammonia and carbon dioxide, avoiding high-global-warming-potential synthetic refrigerants. Industrial heat pumps support low-impact refrigerants.
By using natural refrigerants such as ammonia and carbon dioxide rather than high-global-warming-potential synthetic refrigerants, industrial heat pumps reduce the climate impact of refrigerant leakage, aligning with environmental regulation and improving sustainability.
Dependence on Clean Electricity
The climate benefit of heat pumps depends on the carbon intensity of the electricity they use. Industrial heat pumps depend on clean electricity.
By running on electricity, heat pumps deliver their full climate benefit only where the grid is low-carbon, so their contribution to decarbonisation is tied to the greening of electricity supply across the region's diverse power systems.
Table of contents
15 chapters · 155 pages · click to expandFrequently asked questions
The Asia Pacific industrial heat pump market was valued at USD 540 million in 2025 and is projected to reach USD 1.52 billion by 2036, growing from USD 595 million in 2026, at a CAGR of 9.8% from 2026 to 2036, driven by industrial decarbonisation, energy efficiency, and high-temperature heat pump adoption.