Insulation Market Size Worth USD 128.11 Billion by 2034 Driven by Green Building Initiatives and Advanced Materials

According to Precedence Research, the global insulation market will expand from USD 65.78 billion in 2025 to nearly USD 128.11 billion by 2034, advancing at a strong CAGR of 7.70% from 2025 to 2034. Growth is fueled by rising construction activity, stricter energy efficiency regulations, and the shift toward sustainable building materials, supported by innovations such as eco-friendly fibers and advanced high-performance solutions.

Ottawa, Sept. 23, 2025 (GLOBE NEWSWIRE) -- The global insulation market size is expected to be worth more than USD 128.11 billion by 2034, growing from USD 65.78 billion in 2025. The market is expected to expand at a strong compound annual growth rate (CAGR) of 7.70% from 2025 to 2034. Driven by the expanding construction industry and the implementation of strict energy conservation regulations across the world.

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Insulation Market Key Highlights

In terms of revenue, the global insulation market was valued at USD 62,140 million in 2024.
It is projected to reach USD 128,110 million by 2034.
The market is expected to grow at a notable CAGR of 7.70% from 2025 to 2034.
Asia Pacific dominated the global market with the largest market share of 38.35% in 2024.
North America is expected to grow fastest during the forecast period.
By insulation type, the thermal insulation segment captured the biggest market share of 64.80% in 2024.
By material type, the expanded polystyrene (EPS) segment led the market in 2024.
By end-use type, the building and construction segment contributed the highest market share in 2024.

Insulation Market Size, by Insulation Type 2022-2024 (USD Million)

By Insulation Type	2022	2023	2024
Thermal Insulation	36,429.32	38,022.94	40,263.85
Acoustic Insulation	20,091.14	20,917.84	21,876.39

Insulation Market Size, by Material Type 2022-2024 (USD Million)

By End User	2022	2023	2024
Building and Construction	20,361.40	21,259.37	22,470.10
HVAC and OEM	9,389.07	9,817.18	10,358.91
Transportation	13,585.42	14,198.75	15,083.54
Appliances	5,596.06	5,784.36	6,078.75
Othes (Furniture, Packaging, etc.)	7,588.53	7,881.13	8,148.94

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What is Insulation, and What are its Applications?

The significance of insulation lies in its ability to slow heat transfer, offering numerous benefits like increased energy efficiency by decreasing heating and cooling costs, improved indoor comfort via stable temperatures, improved acoustic performance by dampening noise, and protection against moisture-related issues such as mold growth. Some insulation materials are engineered to be moisture-resistant, assisting in preventing condensation and even moisture buildup that can contribute to mold, mildew, and structural damage.

What are the Major Government Initiatives for Insulation?

1. United Kingdom – Great British Insulation Scheme (GBIS) / Energy Company Obligation (ECO4)

The GBIS is a £1 billion scheme (launched March 2023, running until March 2026) designed to help the least energy efficient households with the cost of installing home insulation.
Under recent “mid‐scheme” changes, households may now install two insulation measures (instead of one) under GBIS in some circumstances; also, “smart thermostat” control measures have been expanded as optional secondary measures for eligible low-income households.

2. UK – Warm Homes Plan

This plan includes the “Warm Homes: Social Housing Fund” to upgrade social housing stock (homes below EPC band C) with insulation and other energy performance upgrades.
Also, the “Warm Homes: Local Grant” provides roughly £500 million over 3 years to local authorities in England, enabling low-income households in homes rated EPC D or lower to receive upgrades (insulation, etc.) up to around £15,000 per household.

3. United States – Energy Efficient Home Improvement Tax Credit (Section 25C)

The U.S. offers a tax credit of 30% of the cost for qualified energy efficiency improvements (including insulation, air sealing, etc.), up to $1,200 for those envelope-improvement components.
There is also an overall limit of $3,200/year, combining this with other eligible clean energy upgrades. These incentives are valid through December 31, 2025. After that, many of the tax credits are scheduled to expire.

4. India – ADEETIE (Assistance in Deploying Energy Efficient Technologies in Industries and Establishments)

This scheme by India’s Bureau of Energy Efficiency (BEE) with approximately ₹1,000 crore budget aims to help MSMEs (micro, small, and medium enterprises) adopt energy-efficient technologies, reduce power consumption, and improve energy productivity. While not solely insulation, improved insulation is a potential part of the technologies adopted.
The scheme targets several energy-intensive sectors and industrial clusters, offering concessional financing (interest subvention) and capacity building, which helps in making insulation and other efficiency upgrades more affordable.

5. Funding through the UK National Wealth Fund for Social Housing Retrofits

The UK’s National Wealth Fund has committed £250 million in loans to help improve the energy efficiency of social housing, including insulation, retrofits, low-carbon heating, and water efficiency.
These loans are structured to attract private and bond investors, helping scale up the retrofit of many homes deemed inefficient and contributing to the UK’s climate goals.

Insulation Market Trends

Shift Toward Sustainable and Green Insulation: Growing environmental awareness is driving demand for eco-friendly materials like natural fibers and recycled insulation. Manufacturers are focusing on reducing carbon footprints and offering sustainable product lines.
Stricter Energy Efficiency Regulations: Governments and regulatory bodies are enforcing higher energy performance standards in buildings. This is boosting the adoption of advanced insulation to meet compliance and reduce energy consumption.
Rise of Smart and High-Performance Insulation; Innovative materials like aerogels, vacuum insulation panels, and phase change materials are gaining attention. These offer superior thermal performance, especially in space-constrained applications.
Boom in Renovation and Retrofitting Projects: Aging buildings, especially in Europe and North America, are being upgraded with modern insulation. Energy-efficient retrofits are supported by incentives and energy-saving goals.
Growth in Industrial and HVAC Insulation Demand: Insulation use is expanding in industrial processes and HVAC systems to improve efficiency and reduce operational costs. This is particularly important in energy-intensive industries and commercial infrastructure.

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Case Study: Retrofitting Social Housing with Sustainable Insulation in the U.K.

Background
The United Kingdom has one of the oldest housing stocks in Europe, with many homes below the EPC (Energy Performance Certificate) band C rating. Poor insulation contributes to high heating bills, fuel poverty, and excess carbon emissions. In 2023, the U.K. government launched the Great British Insulation Scheme (GBIS) under its broader climate and energy efficiency targets.

Challenge

Local authorities were tasked with upgrading low-income households while minimizing upfront costs and ensuring quick implementation. The main issues were:

High heating costs for vulnerable households.
Energy inefficiency due to outdated insulation.
Lack of skilled labor for large-scale installations.

Solution

Under the GBIS program, thousands of homes were retrofitted with expanded polystyrene (EPS) boards and mineral wool insulation. These materials were chosen for their cost-effectiveness, superior thermal performance, and ease of installation. Alongside insulation, smart thermostats were added as secondary measures to optimize energy usage.

Impact

Energy Savings: Retrofitted homes saw an average reduction of 25–30% in annual heating costs.
Comfort & Health: Improved thermal insulation created more stable indoor temperatures, reducing dampness and mold, which positively impacted residents’ health.
Sustainability: Each upgraded household reduced carbon emissions by nearly 1 ton per year, contributing directly to the U.K.’s net-zero targets.
Scalability: The program demonstrated how government funding combined with sustainable insulation technologies can be scaled nationally to address energy poverty and climate change simultaneously.

Key Takeaway

This case illustrates how government-backed initiatives, paired with advanced insulation materials, can deliver economic relief for households, measurable sustainability benefits, and strong market growth opportunities for insulation providers.

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Why Does Growing Consumer Awareness of Environmental Benefits Act as an Opportunity for the Insulation Market?

Growing consumer awareness about environmental benefits creates market opportunities for the insulation sector by driving the need for eco-friendly, energy-efficient, and even sustainable building materials, which leads to increased sales and market expansion for insulation products and sustainable insulation solutions.

Consumers are aware that insulation decreases energy consumption, which lowers energy expenses and leads to environmental sustainability. This direct impact on energy usage makes insulation products more desirable. Governments are incorporating stricter energy efficiency regulations, which makes a market imperative for insulation products. This policy environment works with growing consumer need for green solutions, thus expanding the market.

Insulation Market Challenge

Shortage of Skilled Labor for Proper Installation

The shortage of skilled labor is a major challenge for the industry because proper installation needs specialized skills and also knowledge to ensure energy efficiency and building integrity. A shortage of qualified workers contributes to project delays, increased expenses, potential safety risks, and even subpar installations that can result in high energy losses.

The effectiveness of insulation heavily relies on correct installation methods, making skilled labor vital for achieving desired energy efficiency and even thermal performance. Improper installation, including poorly insulated fittings and tanks, can contribute to significant energy losses and higher annual expenses for building owners.

Insulation Market Report Coverage

Report Attributes	Statistics
Market Size in 2024	USD 62.14 Billion
Market Size in 2025	USD 65.78 Billion
Market Size in 2031	USD 101.09 Billion
Market Size by 2034	USD 128.11 Billion
Growth Rate 2025 to 2034	CAGR of 7.70%
Leading Region in 2024	Asia Pacific
Fastest Growing Region	North America
Base Year	2024
Forecast Period	2025 to 2034
Segments Covered	Insulation Type, Material Type, End User, and Region
Regional Scope	Asia Pacific, North America, Europe, Latin America, Middle East and Africa
Key Players	GAF, Saint Gobain, Recticel, Kingspan Group, URSA, Rockwool Group, Knauf Insulation, Johns Manville, 3M Company, Owens Corning, and Others

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Insulation Market Regional Landscape

How did Asia-Pacific dominate the Insulation Market?

The Asia Pacific insulation market size was evaluated at USD 23.83 billion in 2024 and is expected to surpass around USD 52.35 billion by 2034, at a CAGR of 8.40% from 2025 to 2034.

Asia-Pacific dominates due to rapid urbanization, industrialization, and extensive infrastructure development in countries such as China, India, and Southeast Asia, which drive a high need for construction and cold storage solutions. As more people move to cities, the demand for energy-efficient buildings and enhanced thermal management to cope with varying climates increases, driving the need for insulation. Supportive government policies encouraging energy-efficient buildings and even green construction practices, as seen in China's Five-Year Plans, directly drive insulation demand.

China is leading the regional market due to its massive construction and infrastructure sector, rapid urbanization, and strong government mandates on energy efficiency. As the world’s largest producer and consumer of building materials, China benefits from large-scale manufacturing capabilities and economies of scale, making insulation products more affordable and accessible. Additionally, the Chinese government has implemented strict building energy codes and sustainability targets under its green building initiatives, further boosting demand for thermal and acoustic insulation across residential, commercial, and industrial segments.

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Why is North America the Fastest-growing Insulation Market?

North America is experiencing a boom in both residential and commercial construction, alongside ongoing infrastructure development, which directly drives the need for insulation materials. Rising GDP, industrial activity, and even increasing energy costs are fueling the demand for insulation to improve machinery efficiency, protect equipment, and lower operating expenses. Key companies are expanding their operations and even investing in product development, creating a competitive and innovative market.

The U.S. dominates the regional market due to its vast construction industry, stringent energy efficiency regulations, and strong demand for residential and commercial retrofitting. Federal and state-level initiatives, such as tax credits under the Inflation Reduction Act and energy codes like IECC, are driving the adoption of advanced insulation materials. Additionally, the U.S. has a mature manufacturing base with major insulation producers headquartered domestically, enabling wide product availability and innovation in sustainable and high-performance insulation solutions.

Why is Europe Showing Significant Growth in the Insulation Market?

Europe's is growing significantly due to government-led initiatives such as the EU Green Deal and Renovation Wave, which enforce stringent energy efficiency regulations and provide incentives for retrofitting buildings. This drives demand for higher-performing, sustainable insulation materials to decrease carbon emissions and meet climate goals. There is an increasing demand for soundproofing solutions in urban residential, commercial, and even industrial sectors to create comfortable living and working spaces.

Germany dominates the European market due to its strong emphasis on energy efficiency, robust construction industry, and leadership in green building standards. The country has implemented strict building regulations, such as the Energy Saving Ordinance (EnEV) and requirements under the Energy Efficiency Act, which mandate high-performance insulation in both new builds and renovations. Additionally, Germany's commitment to achieving climate neutrality by 2045 has accelerated investment in sustainable construction technologies, including advanced insulation materials.

Insulation Market Segmentation Insight

Insulation Type Analysis

Why Did the Thermal Insulation Segment Dominate the Insulation Market?

The thermal insulation segment dominates the market due to the rising need for energy efficiency, the growing expenses of utilities, and the increasing construction of residential and even commercial buildings. The growth of the building and construction industry, mainly in residential and commercial sectors, directly raises the requirement for thermal insulation products to improve energy efficiency in new and even existing structures. Thermal insulation is also used in the automotive and aerospace sectors to enhance operational efficiency and meet environmental standards.

The acoustic insulation segment is anticipated to register rapid growth in the market during the forecast period. The World Health Organization (WHO) admits noise pollution as a major environmental health risk, contributing to increased need for solutions that decrease noise levels in homes, workplaces, and even public spaces. It is driven by increased global urbanization, rising consumer need for quieter, more comfortable environments in commercial, residential, and transportation sectors, and stricter regulations on noise pollution. The industrial sector also needs acoustic insulation to handle noise and enhance worker safety and productivity.

Material Type Analysis

Why does the Expanded Polystyrene Segment Dominate the Insulation Market?

Expanded polystyrene (EPS) dominated the market due to its lightweight nature, cost-effectiveness, and excellent thermal insulation properties. Its ease of installation and also moisture resistance made it versatile for roofs, walls, and floors in both residential and commercial buildings. EPS provides good compressive strength, making it durable and even suitable for numerous construction applications. It is utilized across diverse applications in building insulation, including roofs, walls, and floors, as well as for cold chain storage. Due to its low expense and availability, EPS is a preferred alternative in developing countries for construction and other uses.

The aerogel segment is anticipated to register rapid growth in the market during the forecast period. Aerogels are the most effective solid thermal insulators, permitting for thinner, more efficient insulation than conventional materials. Due to its superior thermal insulation properties and also lightweight nature, which allows significant energy efficiency improvements in numerous applications, mainly in the construction and oil & gas industries.

End User Analysis

Why did the Building and Construction Segment Dominated the Insulation Market in 2024?

The building and construction segment dominates the market due to rapid urbanization and infrastructure development, which creates a continuous need for new buildings requiring insulation. Governments globally are implementing stricter building codes that mandate or encourage the usage of insulation to reduce energy consumption and also lower greenhouse gas emissions.

The transportation segment is anticipated to register rapid growth in the market during the forecast period. Due to the increasing need for fuel efficiency and reduced emissions, there is a main focus on electric and hybrid vehicles. The requirement to manage battery heat, enhance passenger comfort with sound, together with vibration dampening, and reduce overall vehicle weight using lightweight materials are key drivers. Insulation materials that reduce noise, vibration, and harshness (NVH) enhance passenger comfort, which is especially important in quieter EV cabins.

Insulation Market Top Companies

GAF - GAF offers a wide range of insulation solutions, including polyiso roofing insulation, designed to enhance energy efficiency and roof system performance.
Saint-Gobain - Saint-Gobain provides innovative insulation products such as glass wool, stone wool, and foam insulation, catering to thermal, acoustic, and fire-resistant needs.
Recticel - Recticel specializes in high-performance polyurethane insulation boards, ideal for floors, walls, and roofs in both residential and commercial construction.
Kingspan Group - Kingspan delivers premium insulation systems, including rigid thermoset insulation boards, vacuum insulation panels, and insulated panels for energy-efficient buildings.
Johns Manville - Johns Manville manufactures a comprehensive line of insulation materials, including fiberglass, spray foam, and mineral wool, for residential, commercial, and industrial applications.
URSA - URSA offers a broad portfolio of glass wool and extruded polystyrene (XPS) insulation products focused on sustainability, thermal performance, and acoustic comfort.
Rockwool Group - Rockwool produces stone wool insulation known for its superior fire resistance, soundproofing qualities, and thermal efficiency across various building types.
Knauf Insulation - Knauf Insulation provides eco-friendly insulation solutions, including glass mineral wool, rock mineral wool, and wood wool, for energy-efficient and sustainable construction.

Recent Developments

In December 2024, Carlisle Companies Incorporated declared that it had entered into a definitive agreement to obtain Texas-based expanded polystyrene insulation manufacturer ThermaFoam, which serves the residential, commercial, and infrastructure construction markets via both the ThermaFoam and PowerFoam brands. Carlisle’s Vision 2030 strategy and strategic pivot are consistent with the purchase of ThermoFoam. (Source: https://www.carlisle.com/)
In October 2024, Knauf Group and Texnopark declared a joint agreement for Knauf to obtain Texnopark’s Rock Mineral Wool insulation business. The acquisition involves a new plant in Tashkent, Uzbekistan, equipped with cutting-edge electric melting technology, which permits low CO2 emissions in production. (Source: https://www.knaufinsulation.com)

Insulation Market Segments Covered in the Report

By Insulation Type

Thermal Insulation
Acoustic Insulation

By Material Type

Glass Wool
Mineral Wool
Expanded polystyrene (EPS)
Extruded polystyrene foam insulation (XPS)
Calcium-Magnesium-Silicate (CMS) Fibers
Calcium Silicate
Polyurethane
Aerogel
Others (Cellulose, Phenolic Foam, etc.)

By End User

Building and Construction
HVAC and OEM
Transportation
Appliances
Others (Furniture, Packaging, etc.)

By Region

North America
- U.S.
- Canada
Europe
- U.K.
- Germany
- France
Asia-Pacific
- China
- India
- Japan
- South Korea
- Malaysia
- Philippines
Latin America
- Brazil
- Rest of Latin America
Middle East & Africa (MEA)
- GCC
- North Africa
- South Africa
- Rest of the Middle East & Africa

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