Industrial CO2 Heat Pump Fenagy
Fenagy CO2 heat pump. Image: Fenagy.

Industrial CO2 Heat Pump Business is Booming for Danish Manufacturer Fenagy

Air-to-water models, which are particularly popular in Denmark, account for 75% of Fenagy’s heat pump projects in the last 12 months.

Driven by the growing decarbonization trend for heating, Danish OEM Fenagy is experiencing increased interest in its industrial CO2 (R744) heat pump models, with air-to-water being particularly popular.

In the last 12 months, Fenagy has handed over eight COheat pump projects to customers, with six being air-to-water units. But the company expects this number to more than double before next winter, with fifteen projects expected to be finalized before the heating season in Europe starts, the company said.

“It Is extremely exciting times for Fenagy,” said Kim Christensen, CEO of Fenagy. “The conversion away from oil and gas is important commercially, but also politically. We even talk about a ‘smoke free’ society where we stop burning any kind of material, even waste and biomass.”

Many types of refrigerants are being used in this effort to reduce the use of fossil fuels, and the choice often depends on the application and capacity range. “COis taking a bigger and bigger market share for heat pumps in the mid-capacity range of 200kW–5000kW [56.9TR–1,421.7TR],” Christensen said.

The increased interest in CO2 heat pumps is not just from Fenagy’s Danish home market. “The interest in heat pumps and combined heating and cooling systems is increasing in Europe, and the journey has just started,” Christensen added.

Russia’s invasion of Ukraine has also helped accelerate an already existing trend of moving away from oil and gas towards electric heat pumps. “The industry [now] contacts us to understand how Fenagy could help, and we are ready. The urgency of a quicker transition is there.”

Fenagy’s current portfolio of CO2 heat pumps are models supplying 80–85°C (176–185°F) water temperatures, but the company is also working on developing new technology to increase these temperatures to around 100°C (212°F) and thus expand the potential application range of its products.

Increased interest in Industrial CO2 heat pump projects

Fenagy is focusing mainly on two markets: utilities like district heating providers and industrial refrigeration applications. The district heating market was where Fenagy experienced its first successes, but the company is now expanding. “Lately the interest in heat pumps from the industrial sector has increased drastically,” Christensen said.

For private industrial companies, energy cost has historically never been a large share of the cost of the final product, and, therefore, focus has been elsewhere. “This, together with a payback horizon of 2–3 years on energy projects, have made many [industrial] projects financially inefficient,” he noted.

But the big difference now is that energy markets (gas, oil, electricity) are becoming “extremely volatile and even scarce,” he explained, adding that this makes energy a limited resource and threatens the output from the manufacturer production lines.

“This brings more creativity into the projects, and we see more interest in what we are doing, with heat pumps, combined heating and cooling, and sector coupling between ‘utility’ and ‘industrial’ sectors” becoming more common, he said.

“We offer more and more reversible heat and cooling units and see that heating and cooling systems are growing together in multipurpose systems,” Christensen concluded.

Fenagy is still a young company, having started business in the summer of 2020. In November 2020, Swedish Manufacturer Beijer Ref invested in the company. Fenagy also produces industrial COrefrigeration systems.

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