This study examines the potential for the smart integration of waste and renewable energy sources to supply industrial heat at temperatures between 150 °C and 250 °C, aiming to decarbonize heat demand in European industry. This work is part of a European project (SUSHEAT) which focuses on developing a novel technology that integrates several innovative components: a Stirling cycle high-temperature heat pump (HTHP), a bio-inspired phase change material (PCM) thermal energy storage (TES) system, and a control and integration twin (CIT) system based on smart decision-making algorithms. The objective is to develop highly efficient industrial heat upgrading systems for industrial applications using renewable energy sources and waste heat recovery. To achieve this, the specific heat requirements of different European industries were analyzed. The findings indicate that industrial sectors such as food and beverages, plastics, desalination, textiles, ceramics, pulp and paper, wood products, canned food, agricultural products, mining, and chemicals, typically require process heat at temperatures below 250 °C under conditions well within the range of the SUSHEAT system. Moreover, two case studies, namely the Pelagia and Mandrekas companies, were conducted to validate the effectiveness of the system. An analysis of the annual European heat demand by sector and temperature demonstrated that the theoretical potential heat demand that could be met by the SUSHEAT system is 134.92 TWh annually. Furthermore, an environmental impact assessment estimated an annual significant reduction of 19.40 million tonnes of CO2 emissions. These findings underscore the significant potential of the SUSHEAT system to contribute to the decarbonization of European industry by efficiently meeting heat demand and substantially reducing carbon emissions.