Overview of Heating and Cooling: Perceptions, Markets and Regulatory Frameworks for Decarbonisation



The transition to net-zero greenhouse gas emissions would be impossible without decarbonisation of H&C. To achieve this transformation of the H&C sector, solutions at the individual, system and macro-level are necessary. In this project, the focus lies on identifying the regulatory, economic and cultural conditions that characterise the H&C market with a particular attention on district heating and heat pump solutions. With regard to policy instruments, a specific focus is directed at energy efficiency obligations schemes (EEOSs), which are the preferred instrument to fulfil the obligations under Article 7 EED.

The overarching objective and challenge of the EU’s climate and energy policy is the transition to a net-zero emission society. The EU countries have agreed on 2030 climate and energy targets (greenhouse gas emissions, energy efficiency, renewables) to achieve the transformation to a low carbon energy economy (see 2050 long-term strategy). Renewable energies and energy efficiency are key for this transition. In 2017, the EU reached a share of 17.5% (RES-target 2020 of 20%) of renewable energy in gross final energy consumption, but the pace of growth has decreased. Similarly, if energy consumptions continues to rise in the next years, the EU will fail its energy efficiency target in 2020. Thus, in both area the EU has to intensify its efforts for a transition to net-zero emissions society. As H&C accounts for about 50% in energy consumption and as the non-ETS contributions are supposed to decrease by 30% until 2030, special efforts are needed there. Given the current energy and climate policies, the targets and overarching objectives, and the uncertain or insufficient target achievement the question arises: What are further drivers and barriers of the H&C sector towards a low carbon sector? I.e. the specific objective of this study is: what are the factors that govern the use of efficient and renewable technologies, and thus the transition of the energy system to a low-carbon energy system? We aim at identifying the elements of transition to a net-zero emission society with minimal negative spillovers and maximum engagement of the H&C sector and present the pathways to decarbonisation. This includes:

  • Identifying actors’ needs and interactions with the system, structures and governance
  • Identifying policies, regulatory framework, schemes and structures, governing the transition of H&C system, and the behaviour of actors.
  • Identifying the role of institutions and structures for a transition to net-zero emission H&C sector
  • Assessing the significance of those factors for the transition to a renewable energy based and efficient H&C sector with a focus on DHC and HP
  • Describing the main components of DHC and HP systems and their costs, as well as the benefits of these technologies from an individual and societal perspective
  • Assessing existing and suggesting further policies/regulatory instruments driving the transition of the H&C sector, with a special focus on HP and HC


  • Reports on framework conditions, acceptability, cost structures, role of DHC and HP
  • Databases on relevant literature, perceptions
  • Excel sheet on calculation of costs
  • Monetary and non-monetary drivers of deploying heat pumps, and district heating and cooling

Reports: mid/end of 2021





DG Ener, EC


  • Fraunhofer ISI
  • DTU
  • AIT
  • EHPA
  • University of Aberdeen