Heat Pump Sector Urges Policy Clarity to Unlock Non-Domestic Adoption

Why It Matters

Without policy certainty, the retrofit market may stall, jeopardising supply chains, jobs, and the UK’s ability to meet its climate commitments. Clear incentives and infrastructure support are essential to scale heat‑pump adoption across the commercial sector.

Key Takeaways

• 125,000 heat pumps sold in 2025, but non‑domestic share remains low
• CCC targets 88% low‑carbon heating for non‑residential sector by 2040
• HPA UK urges national electrification plan with dedicated task‑force
• Calls for reduced electricity tariffs to make heat pumps cost‑competitive
• Seeks fast‑track grid connections and private‑investment business models

Pulse Analysis

The UK’s heat‑pump market has surged in the residential segment, yet commercial and industrial uptake lags behind, creating a policy blind spot. Analysts note that the sector’s growth hinges on aligning electricity pricing with the cost structure of fossil‑fuel alternatives. By reducing the price differential, heat pumps become financially viable for businesses, encouraging a shift toward low‑carbon heating solutions that can meet the Climate Change Committee’s 88% target for 2040.

A dedicated national plan would provide the scaffolding needed for large‑scale deployment. HPA UK’s call for a task‑force mirrors successful models in Germany and the Netherlands, where coordinated government‑industry efforts accelerated grid upgrades and streamlined permitting. Fast‑track grid connections are especially critical for energy‑intensive industries that require reliable power for heat‑pump operation, reducing bottlenecks that currently deter private investors.

Beyond infrastructure, the association stresses the importance of innovative financing and business models. Public‑private partnerships, performance‑based contracts, and green‑bond financing can unlock capital for retrofits, while clear long‑term policy signals build market confidence. As the Future Homes and Buildings Standard mandates low‑carbon heating for new non‑domestic builds from 2028, a holistic approach that couples standards with supportive economics will be vital to sustain supply chains, protect jobs, and deliver on the UK’s net‑zero agenda.