Market overview
The global district heating market is worth USD 197 bn in 2026 and is forecast to reach USD 269 bn by 2036, growing at a 3.2% CAGR. China is the largest country market and Natural gas is the largest by source segment.
| Scope | Heat sold through district heating networks to homes, commercial buildings and industry, measured as revenue from delivered heat across all fuels. |
|---|---|
| Industry | Services and Utilities |
| Value 2025 | USD 190 bn |
| Value 2026 | USD 197 bn |
| Value 2036 | USD 269 bn |
| CAGR 2026-2036 | 3.2% |
| Volume 2026 | 12,684 petajoules |
| Volume 2036 | 14,258 petajoules |
| Average price 2026 | USD 15,500,000 per petajoule |
| Report price | Starts from USD 1,999 |
| Published | November 2026 |
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District Heating market size and forecast, 2026-2036
Source: Compare Market Research analysis.
© 2026 Compare Market Research. All rights reserved.
| Year | Market value |
|---|---|
| 2026 | USD 197 bn |
| 2027 | USD 203 bn |
| 2028 | USD 209 bn |
| 2029 | USD 216 bn |
| 2030 | USD 223 bn |
| 2031 | USD 230 bn |
| 2032 | USD 238 bn |
| 2033 | USD 245 bn |
| 2034 | USD 253 bn |
| 2035 | USD 261 bn |
| 2036 | USD 269 bn |
District Heating market segmentation
By source
Source: Compare Market Research analysis.
© 2026 Compare Market Research. All rights reserved.
| Segment | Share 2026 | Share 2036 | Value 2026 | CAGR 2026-36 |
|---|---|---|---|---|
| Coal | 30.0% | 18.5% | USD 59.0 bn | -1.7% |
| Natural gas | 33.0% | 27.4% | USD 64.9 bn | 1.3% |
| Biomass and waste | 14.0% | 17.9% | USD 27.5 bn | 5.8% |
| Industrial waste heat | 8.0% | 10.2% | USD 15.7 bn | 5.8% |
| Electricity and heat pumps | 7.0% | 17.7% | USD 13.8 bn | 13.2% |
| Geothermal and solar thermal | 3.0% | 5.8% | USD 5.9 bn | 10.2% |
| Oil and other | 5.0% | 2.5% | USD 9.8 bn | -3.7% |
By end user
Source: Compare Market Research analysis.
© 2026 Compare Market Research. All rights reserved.
| Segment | Share 2026 | Share 2036 | Value 2026 | CAGR 2026-36 |
|---|---|---|---|---|
| Residential | 62.0% | 60.4% | USD 122 bn | 2.9% |
| Commercial and public | 25.0% | 26.3% | USD 49.2 bn | 3.7% |
| Industrial | 13.0% | 13.3% | USD 25.6 bn | 3.4% |
By network generation
| Segment | Share 2026 | Share 2036 | Value 2026 | CAGR 2026-36 |
|---|---|---|---|---|
| Steam-based second generation | 18.0% | 10.0% | USD 35.4 bn | -2.7% |
| Third generation hot water | 51.0% | 44.0% | USD 100 bn | 1.7% |
| Fourth generation low temperature | 24.0% | 32.0% | USD 47.2 bn | 6.2% |
| Fifth generation ambient loops | 7.0% | 14.0% | USD 13.8 bn | 10.6% |
By ownership
| Segment | Share 2026 | Share 2036 | Value 2026 | CAGR 2026-36 |
|---|---|---|---|---|
| Municipal utilities | 48.0% | 43.0% | USD 94.4 bn | 2.1% |
| Private energy companies | 34.0% | 36.0% | USD 66.9 bn | 3.8% |
| Cooperatives and community schemes | 18.0% | 21.0% | USD 35.4 bn | 4.8% |
By revenue stream
| Segment | Share 2026 | Share 2036 | Value 2026 | CAGR 2026-36 |
|---|---|---|---|---|
| Heat sales | 72.0% | 68.0% | USD 142 bn | 2.6% |
| Capacity and standing charges | 19.0% | 20.0% | USD 37.4 bn | 3.7% |
| Connection fees and services | 9.0% | 12.0% | USD 17.7 bn | 6.2% |
Top 25 countries for district heating by revenue
Countries are ranked by revenue earned from sales in the country, not by where the product is made. The ten largest hold 75.5% of 2026 revenue and the 25 countries below together hold 92.4%.
Source: Compare Market Research analysis.
© 2026 Compare Market Research. All rights reserved.
| # | Country | Value 2026 | Share 2026 | Value 2036 | CAGR 2026-36 |
|---|---|---|---|---|---|
| 1 | China | USD 74.7 bn | 38.0% | USD 107 bn | 3.6% |
| 2 | Russia | USD 21.6 bn | 11.0% | USD 24.3 bn | 1.1% |
| 3 | Germany | USD 11.8 bn | 6.0% | USD 16.7 bn | 3.5% |
| 4 | Sweden | USD 7.9 bn | 4.0% | USD 11.3 bn | 3.7% |
| 5 | Poland | USD 6.9 bn | 3.5% | USD 9.4 bn | 3.2% |
| 6 | Finland | USD 5.9 bn | 3.0% | USD 8.4 bn | 3.5% |
| 7 | South Korea | USD 5.9 bn | 3.0% | USD 8.1 bn | 3.2% |
| 8 | United States | USD 4.9 bn | 2.5% | USD 6.5 bn | 2.8% |
| 9 | Denmark | USD 4.9 bn | 2.5% | USD 6.7 bn | 3.2% |
| 10 | Ukraine | USD 3.9 bn | 2.0% | USD 5.1 bn | 2.7% |
| 11 | France | USD 3.7 bn | 1.9% | USD 5.2 bn | 3.4% |
| 12 | Czech Republic | USD 3.4 bn | 1.8% | USD 4.8 bn | 3.3% |
| 13 | Austria | USD 3.2 bn | 1.6% | USD 4.4 bn | 3.3% |
| 14 | Norway | USD 2.9 bn | 1.5% | USD 4.0 bn | 3.3% |
| 15 | Romania | USD 2.7 bn | 1.4% | USD 3.7 bn | 3.4% |
| 16 | Belarus | USD 2.5 bn | 1.2% | USD 3.4 bn | 3.4% |
| 17 | Italy | USD 2.3 bn | 1.1% | USD 3.1 bn | 3.3% |
| 18 | Netherlands | USD 2.1 bn | 1.1% | USD 3.5 bn | 5.5% |
| 19 | Lithuania | USD 1.9 bn | 1.0% | USD 2.6 bn | 3.3% |
| 20 | Latvia | USD 1.8 bn | 0.9% | USD 2.4 bn | 3.3% |
| 21 | Estonia | USD 1.6 bn | 0.8% | USD 2.2 bn | 3.3% |
| 22 | Hungary | USD 1.5 bn | 0.8% | USD 2.0 bn | 3.3% |
| 23 | Slovakia | USD 1.4 bn | 0.7% | USD 1.9 bn | 3.4% |
| 24 | Kazakhstan | USD 1.3 bn | 0.6% | USD 1.8 bn | 3.4% |
| 25 | Switzerland | USD 1.1 bn | 0.6% | USD 1.6 bn | 3.4% |
| Rest of world | USD 15.0 bn | 7.6% | USD 19.5 bn | 2.7% |
Source: Compare Market Research analysis.
© 2026 Compare Market Research. All rights reserved.
Competitive landscape
Group 1: Global leaders
- Veolia
- Engie
- Fortum
- Vattenfall
- Dalkia
- Mosenergo
Group 2: Regional and specialist players
- Stockholm Exergi
- Helen
- HOFOR
- Beijing Enterprises Holdings
- Wien Energie
- MVV Energie
- Göteborg Energi
- Korea District Heating Corporation
- Vantaan Energia
Group 3: Emerging and niche players
- Vicinity Energy
- Ever-Green Energy
- Enwave Energy
- Tallinna Küte
- Vilniaus šilumos tinklai
Research methodology
Every figure on this page comes from the research framework that we apply to all of the markets we cover. The 2025 base for the district heating market is built from the volume sold and the price that buyers pay, and is cross-checked against the size of the wider industry the market belongs to. Where a market can be sized in more than one way, the routes are compared before a figure is set.
The forecast runs year by year from the 2025 base to 2036. Growth in each year reflects demand from the industries that buy the product, adoption of new technology, pricing, regulation and replacement cycles. Volume and price are modelled together, so revenue in each year equals volume multiplied by average price. The 2026 to 2036 compound annual growth rate of 3.2% is calculated from the resulting values.
The market is divided by source, by end user, by network generation, by ownership, by revenue stream. The 25 largest countries are ranked by revenue earned from sales to buyers in each country, not by where the product is made. Segment values and country values add up to the market total in every year, and every report is checked for consistency before it is published.
Companies are placed in three groups: global leaders, regional and specialist players, and emerging and niche players. The groups describe how companies compete in the market. They are not a ranking and they are not market shares.
Our analysts also carry out primary research. Customized reports add interviews with key opinion leaders, such as senior executives, technical specialists and buyers, to test the assumptions behind the numbers for the question being asked.
Frequently asked questions
How big is the district heating market?
The global district heating market is estimated at USD 190 bn in 2025 and USD 197 bn in 2026.
How fast will the district heating market grow?
It is forecast to reach USD 269 bn by 2036, a compound annual growth rate of 3.2% from 2026, an increase of USD 72.8 bn.
Which country is the largest market for district heating?
China is the largest market by revenue at USD 74.7 bn in 2026, 38.0% of the global total. The three largest countries together hold 55.0%.
Which country is growing fastest?
Among the ten largest markets, Sweden is growing fastest at 3.7% a year from 2026 to 2036.
Which district heating segment is largest?
In the by source split, Natural gas is the largest segment with 33.0% of 2026 revenue.
Who are the leading district heating companies?
Global leaders include Veolia, Engie, Fortum, Vattenfall.
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