Heat pump ‘readiness indicator’ to evaluate savings for consumers

Europe’s power system will face additional strain in winter as the electrification of heating progresses, making the renovation of buildings an essential element to reduce strain on the electricity grid and optimise the performance of heat pumps.

The electrification of heating will be key for Europe to achieve its goal of reaching climate neutrality by 2050.

Eurelectric, the EU’s power industry association, forecasts that electricity demand for heating buildings in Europe and the UK will increase from 1,726 Terawatt hours (TWh) today to at least 2,145 TWh and up to 2,546 TWh by 2050.

Fossil fuels in heating will have to be entirely eliminated by then in order to reach the EU’s climate goals, Eurelectric points out. 

To reach this goal, the European Heat Pump Association (EHPA), whose estimates are probably optimistic, figures that 60 million units will be installed across the EU by 2030. 

But unlike fossil fuels, which can be stockpiled ahead of cold winter days, electricity is much more challenging to store and needs to be provided nearly continuously. In the near future, the power system will therefore have to be capable of dealing with massive demand peaks on cold winter days. 

Knauf Energy Solutions, a subsidiary of the German insulation manufacturer, estimates that future peak EU winter electricity demand may increase from some 9,000 Gigawatt hours (GWh) to almost 16,000 GWh. 

This extra flexibility may come in different forms, including large-scale batteries, demand response, or decarbonised gases that can be burned in back-up power plants.

But those can be costly to deploy at scale, putting efficiency measures like renovation back at the centre of attention.

“The more houses are renovated, the lower the electricity demand on peak load days in winter,” says Matthias Huber, a professor researching energy systems at the Technical University Ingolstadt. 

This saves money for the energy system as a whole because “less back-up power generation capacity is needed for cloudy winter days, and savings can be made on grid expansion,” he added.

For consumers, there is a second bonus: “A renovated house can be heated with a lower flow temperature, which means that the heat pump can be operated more efficiently and thus more cheaply,” the professor explained.

The industry is keen to expound on this added benefit. “Installing a heat pump plus insulation is more than just the addition of the two,” explains David Ducarme from Knauf Insulation. “It’s a multiplying effect.”

“Every kilowatt-hour saved during the winter peak is worth much more than an average kilowatt-hour. That’s a dynamic which should drastically change our approach,” he added.

Despite the potential benefits of renovation in a changed heating system, Europe’s renovation rates lag far behind policy goals. The Renovation Wave launched in 2020 sought to double meaningful renovation rates from 1% to 2% but has seen little progress since then.

Insulation exec.: 'Heat pumps alone will not do the trick'

A properly insulated home will allow heat pumps to deliver their “magic trick” – a 400% efficiency rating over the 90% figure observed for fossil gas boilers. Yet, these efficiency gains will not materialise unless homes are heat-pump ready, says David Ducarme.

Heat pump ‘readiness’ indicator

The Buildings Performance Institute Europe, a think-tank focussing on building performance, has developed a tool to match optimal buildings to heat pumps, at the demand of the European consumer advocates at BEUC.

BPIE calls it the “heat pump readiness” indicator for buildings – giving consumers clear guidance on whether they can expect optimal performance from their future heat pump in their home. 

The think tank devised a way of calculating a building’s energy demand that can be comfortably covered by a heat pump operating efficiently. Existing energy performance certificates attached to buildings (EPCs) contain the necessary information and could display the heat pump readiness of a given building.

The indicator “will have little value unless it is properly communicated. EPCs can be an important tool to pass this information to building owners,” the report cautions.

EPCs, the indicators that rank houses from A to G on a colour-coded scale, are famously awful.

“There is a real issue with EPC accuracy,” says Ducarme, whose company conducts energy use readings of houses and frequently compares them to what the certificates state.

To provide a smoother customer journey, Ducarme argues for a comprehensive approach.

“We see a world where when you have a house, and you want to do an energy renovation, you measure the current performance, you get a metered [and accurate] EPC, then you can assess what are the paybacks on simple energy efficiency measures,” he said.

At the same time, the heat pump readiness indicator would lay out the path towards a house’s future heating system.

“You get the level of readiness for transitioning to a heat pump before, and after renovation, then you have a user which has all the data at their disposal to make the right choices,” he added.

Huber, for his part, warned against setting up overly complex subsidy programmes to pick up these benefits of renovation. “The expected high electricity prices on cold winter days are actually incentive enough to renovate,” the German professor explained. 

Such pricing signals to consumers would also depend on the flexibility of electricity tariffs, which may vary from one operator to another and are regulated differently across the EU.

Report: Renovating EU houses could save 44% of energy for heating

With a tripling of the current renovation rate, almost all residential buildings in the European Union could be renovated by 2050, saving 44% of final energy used in space heating, a new report shows.

[Edited by Frédéric Simon and Alice Taylor]

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