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Global Energy Innovation Progress for Heat Pumping Technologies Highlighted in IEA Flagship Report

The International Energy Agency’s (IEA) latest “State of Energy Innovation” report showcases significant strides in global energy innovation, outlining key findings across critical technology areas and policy action recommendations. Notably, the report emphasizes considerable advancements in heat pumping technologies, including solid-state cooling.

The report indicates robust international collaboration and increased public and private investments that are driving rapid progress in energy technologies. It highlights innovation momentum despite geopolitical and economic uncertainties, with significant developments in sustainable energy systems that promise substantial impacts on global emissions reduction and energy security.

Significant Strides in Heat Pump Technology

Heat pump technologies have emerged as particularly dynamic, being central to efforts aimed at reducing global greenhouse gas emissions through improved efficiency in heating and cooling systems. Recent advancements underline their critical role in transitioning towards sustainable energy systems. Notably, the IEA’s Technologies Collaboration Programme on Heat Pumping Technologies (HPT TCP) has significantly contributed to international cooperation and innovation within the sector, facilitating collaborative research to advance heat pump applications globally. Representatives from the TCP has contributed with review and input to this report.

The report highlights innovations within the area of heat pumping technologies from several sectors:

Landmark Demonstration of Low-Charge Propane Heat Pumps

Germany’s Fraunhofer ISE made headlines in 2024 by demonstrating large-capacity, low-charge propane heat pumps designed specifically for multi-occupancy buildings. These innovative systems use less than 150 grams of propane, significantly expanding their applicability, particularly suitable for existing multi-family buildings with floor heating and centralized heating systems. This technology builds upon previous efficiency achievements in single-family homes, where record efficiency was reached using only around 10 grams of propane per kilowatt (kW).

Propane, an environmentally friendly hydrocarbon refrigerant, has an exceptionally low global warming potential (GWP) of just 0.02, making it a promising alternative to the high-GWP refrigerants traditionally used. However, due to propane’s inherent flammability, ongoing research and innovation continue to focus on further reducing refrigerant charges to enhance safety.

Within HPT TCP there is an international collaboration project on Safety Measures for Flammable Refrigerants (Annex 64) in which Fraunhofer ISE is an active participant.

 

Industrial Heat and District Heating

Industrial heat innovation saw remarkable investment growth in 2024, notably in industrial-scale heat pump applications, according to the report. High-temperature thermal storage systems by companies like Rondo Energy, in partnership with Siam Cement Group, have shown significant potential in providing sustainable baseload heat for industries.

District heating also experienced notable investment activity, with projects repurposing excess heat from data centers gaining momentum, such as the UK-based Deep Green project, highlighting its essential role in urban sustainability.

The HPT TCP has recently finalized one international collaboration on high-temperature heat pumps for industrial applications (Annex 58) and one with a focus on heat pumps in thermal networks, i.e., district heating (Annex 57).

Increasing Investment and Market Expansion in the Heat Pump Sector

The heat pump sector’s robust growth is marked by substantial venture capital and public funding. IEA reports that in 2024, AtmosZero, an American company specializing in industrial-scale heat pumps, secured USD 21 million in venture capital, showcasing strong investor confidence in the sector’s future. This trend reflects the global acknowledgment of heat pumps as essential technologies for meeting ambitious climate targets and improving energy efficiency. Global adoption is accelerating, driven by supportive policies, technological advances, and strategic investments aimed at improving efficiency, affordability, and consumer adoption.

Breakthrough in Solid-State Cooling

Another notable development highlighted in the report involves solid-state cooling technology achieving groundbreaking efficiency. In 2024, Barocal, a startup based in the United Kingdom, successfully developed a solid-state cooling system that matches the efficiency of conventional vapor-compression cooling systems. Simultaneously, researchers at the Hong Kong University of Science and Technology significantly improved the efficiency of elastocaloric cooling systems, broadening their operational temperature range to 100 Kelvin, a critical leap forward.

Solid-state cooling systems utilize advanced materials that exhibit temperature changes under electric, magnetic, or mechanical stress, eliminating the need for environmentally harmful hydrofluorocarbon refrigerants and significantly reducing greenhouse gas emissions.

The recently completed HPT TCP Annex 53 Advanced Cooling/Refrigeration Technologies Development, an international collaboration project, explored innovative heat pumping technologies, significantly advancing knowledge and application of solid-state cooling systems.

Three Dynamic Innovation Areas in Focus

The report specifically identifies three other dynamic areas with strong innovation progress:

  • Batteries
  • Carbon Capture Utilization and Storage (CCUS)
  • Critical minerals sourcing

These areas have seen substantial growth, driven by technological breakthroughs and supportive international policies, further underlining their importance in the global energy transition.

Ten Priority Action Areas

To sustain innovation momentum, the IEA proposes ten priority actions for policymakers:

  1. Increase public energy R&D and demonstration funding to attract private investment.
  2. Ensure stable financial support throughout economic cycles.
  3. Strengthen international collaboration on large-scale demonstration projects.
  4. Facilitate access to artificial intelligence datasets for energy innovation.
  5. Support open access to testing facilities and “living labs.”
  6. Reduce bureaucratic hurdles to streamline innovation processes.
  7. Provide tailored policy support for specific technology needs.
  8. Enhance innovation systems in developing economies.
  9. Maximize impacts from public investments in pioneering projects.
  10. Foster strong markets to secure future demand for innovative technologies.

Strategic Outlook and Challenges

Despite the encouraging progress, challenges remain, notably high initial investment costs, market entry barriers, and limited public awareness. The IEA emphasizes that ongoing international cooperation, targeted investments, and supportive policy frameworks are essential to addressing these challenges and accelerating the widespread adoption of innovative energy technologies.

In conclusion, the IEA’s findings underscore the critical role of heat pumping technologies, including solid-state cooling, as transformative components of the global energy innovation landscape.

For more details on the Heat Pumping Technologies Collaboration Programme and HPT TCP Annex 53, Annex 57, Annex 58, and Annex 64 (mentioned above), visit: https://heatpumpingtechnologies.org/

Source:

The State of Energy Innovation
International Energy Agency, April 2025.
Available at: https://www.iea.org/reports/the-state-of-energy-innovation
Direct PDF download: https://iea.blob.core.windows.net/assets/26e9f71e-3a3f-4c82-802b-c2ed97aaae24/Thestateofenergyinnovation.pdf