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Residential demands for space heating and hot water account for 31% of thetotal European energy demand. Space heating is highly dependent on ambientconditions and susceptible to climate change. We adopt a techno-economicstandpoint and assess the impact of climate change on decentralised heatingdemand and the cost-optimal mix of heat pump and gas boiler technologies.Temperature data with high spatial resolution from nine climate modelsimplementing three Representative Concentration Pathways from IPCC are used toestimate climate induced changes in the European demand side for heating. Thedemand side is modelled by the proxy of heating-degree days. The supply side ismodelled by using a screening curve approach to the economics of heatgeneration. We find that space heating demand decreases by about 16%, 24% and42% in low, intermediate and extreme global warming scenarios. When consideringhistoric weather data, we find a heterogeneous mix of technologies arecost-optimal, depending on the heating load factor (number of full-load hoursper year). Increasing ambient temperatures toward the end-century improve theeconomic performance of heat pumps in all concentration pathways. Cost optimaltechnologies broadly correspond to heat markets and policies in Europe, withsome exceptions

Impact of climate change on the cost-optimal mix of decentralised heat pump and gas boiler technologies in Europe