Renewable Heating and Cooling Pathways, Measures and Milestones for the implementation of the recast Renewable Energy Directive and full decarbonisation by 2050

Study on behalf of DG ENER

Heating and cooling (H&C) account for around half of the EU energy use, with space heating taking the largest share of the EU’s final energy demand for H&C, followed by process heating and hot water. The EU H&C sector is largely based on fossil fuels, where the share of renewable H&C in the EU 27 increased from 11.7 % in 2004 to 22.1 % in 2019

The shares of renewable energies in H&C vary strongly between the EU Member States, with Sweden, Finland, Latvia, Denmark and Austria showing the highest shares of more than 30%. Likewise, the future transition pathways and the required policy mixes will be different in the various countries.

While both the RES-H&C shares and their annual rates vary strongly between the Member States, there are some major barriers that currently prevent a faster uptake of RES in H&C in most countries. Such barriers are of technical nature (space needed, temperature levels required, local resources available, very mature incumbent technology), organisational and market nature (installers slowly change business models and lack experience with RES technologies, consumers demand similar technology when replacing an old boiler, etc.), and economic nature (economic attractiveness of natural gas boilers in most countries, high upfront investment for RES technologies). Furthermore, these barriers and market elements as well as resource availability do not only vary by country, they are also very specific to a region or city.

In view of these challenges, the aim of this study is to provide the analytical basis for developing a policy framework to support the full decarbonisation of the heating and cooling sector by 2050 in buildings and industry. The study has the following objectives:

  • Establishing economic potentials of renewable heating and cooling supply deployment via individual and district (communal) solutions
  • Providing recommendations for measures and milestones and the necessary enabling legal, regulatory and investment framework to realise those potentials via scenarios and portfolios of measures in the perspectives of the EU 2030 and 2050 climate and energy objectives, and beyond
  • Performing highly detailed and disaggregated modelling of specific scenarios, pathways and measures to decarbonise heating and cooling through renewable energy sources
  • Establishing quantified milestones of renewable heating and cooling deployment, provide benchmarks to assess progress towards meeting the targets for renewable heating under the renewable energy directive.


  • Oeko-Institut (coordinator)
  • Fraunhofer ISI
  • TU Wien
  • e-think
  • Halmstad University