The global District Heating Market size was valued at USD 197.5 billion in 2024 and is projected to reach USD 267.7 billion by 2030. This expansion corresponds to a Compound Annual Growth Rate (CAGR) of 5.3% over the forecast period from 2025 to 2030.

 

District heating systems offer efficiency gains compared to individual heating systems by utilizing waste heat from industrial processes, power generation, or renewable sources such as biomass and geothermal energy. This efficient use of heat resources not only reduces overall energy consumption but also lowers greenhouse gas emissions, aligning with global climate goals.

 

Another driver is urbanization and the densification of cities. As urban populations grow and cities expand vertically, the demand for heating in densely populated areas intensifies. District heating systems are particularly well-suited for these environments due to their ability to serve a large number of buildings efficiently from a centralized location. This scalability makes them an attractive solution for urban planners seeking sustainable and cost-effective heating options.

 

Key Market Trends & Insights

  • Europe dominated the global district heating market with the largest revenue share of 74.2% in 2024.
  • The district heating market in Poland is estimated to grow at a significant CAGR of 6.3% over the forecast period.
  • By heat source, the demand for the renewables segment is expected to grow at a significant CAGR of 6.9% from 2025 to 2030.
  • By application, the demand for the residential segment is expected to grow at a significant CAGR of 5.9% from 2025 to 2030
  • By plant type, the demand for the combined heat & power segment is expected to grow at a significant CAGR of 5.9% from 2025 to 2030.

  

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Market Size & Forecast

  • 2024 Market Size: USD 197.5 Billion
  • 2030 Projected Market Size: USD 267.7 Billion
  • CAGR (2025-2030): 5.3%
  • North America: Largest market in 2024

 

Key Companies & Market Share Insights

Key players operating in the district heating market are undertaking various initiatives to strengthen their presence and increase the reach of their products and services. Strategies such as expansion activities and partnerships are key in propelling the market growth.

 

Key Players

  • Danfoss Group
  • Ramboll
  • Dall Energy
  • Veolia
  • Helen
  • ALFA LAVAL
  • General Electric Company
  • Uniper SE
  • ENGIE
  • FVB Energy Inc.
  • Vattenfall AB
  • Fortum

 

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Conclusion

The district heating market is a pivotal player in the global transition toward more sustainable and resilient energy infrastructures. Its growth is fundamentally propelled by its inherent energy efficiency, its ability to utilize a diverse range of renewable energy sources, and the support it receives from favorable government policies and regulations globally.