Heat Pumps and Heat Networks Assemblies and Key Component Analysis

Scottish Enterprise commissioned Ramboll to analyse supply chains for Heat Pump and Heat Network at a key component level and the anticipated levels of demand in order to determine where and how Scottish manufacturers can best enter the supply chain, compete against established manufacturers as well as help establish where Scottish Enterprise should focus support for maximum economic impact.

This research was informed by an extensive literature and information review including previous Ramboll studies, relevant academic research, and market intelligence from publicly available sources and databases. In addition, 8 expert interviews were conducted from the following four categories: Ramboll experts, wider stakeholders, heat pump experts, and heat network experts network experts.

This report presents the findings from technical and market analyses of key components from heat pumps and heat networks conducted by Ramboll for Scottish Enterprise. Heat pumps and heat networks are expected to see rapid growth in the UK and across Europe, driven by macro-trends of decarbonisation and security of energy supply. In the first half of this report, a technical analysis is presented, identifying the two key components from each technology. In the second half, the markets in Scotland, the rest of the UK (RoUK), Denmark and France are analysed, both in terms of size and accessibility for potential new entrants. The current market leaders for each of the components are also identified and analysed, both in terms of their business and products, as well as competitive advantages. Finally, the countries of origin of the leading manufacturers are identified, and any economic incentives for manufacturers are provided.

• Within heat pumps, compressors and controls were identified as two of the components with the most potential for Scotland. For heat networks, it was controls and preinsulated steel pipes. These components were selected according to their value, existing expertise in Scotland, innovation potential, procurement difficulty, and potential for retrofits. Across all geographies, there was a strong market growth forecast for the key components, but particularly for the UK and France, where predicted growth rates were highest.