The European Commission’s Electrification Action Plan calls for annual heat pump installations to rise from 2.4 million in 2025 to 4 million by 2030. Published on 17 July 2026, the plan includes measures covering energy taxation, electricity and gas price ratios, financing, system flexibility and industrial electrification.
The Commission proposes reducing national electricity-to-gas price ratios to a maximum of 2.5 for households and 2.0 for industry by 2030. It also states that Member States should not tax electricity more than gas and calls for reforms to network charges and the phase-out of fossil fuel subsidies.
To address upfront costs, the plan proposes expanded financing and social leasing schemes, greater use of public procurement and improved price transparency. It also supports faster smart meter deployment and the integration of heat pumps into demand response markets.
For industry, the plan states that around 60% of fuel-based energy demand can be electrified using heat pumps. Proposed support includes the Industrial Decarbonisation Bank, a second Innovation Fund industrial heat auction, sector-specific electrification roadmaps, grid connections, thermal storage and energy management systems.
The plan also launches an EU Waste Heat Initiative and sets a target for waste heat recovery to supply 11% of Europe’s heat demand by 2050. It includes support for district heating and cooling networks, municipal heating plans, heat pump manufacturing, installer skills and workforce development.
“This Electrification Action Plan is a game-changer. For the first time it focuses on boosting electrification of demand – and does so via a great line-up of measures, from tackling energy taxation and electricity prices and tapping on heat pumps’ flexibility, to supporting industrial electrification and waste heat recovery,” said Jozefien Vanbecelaere, Policy Director at the European Heat Pump Association.
