To reach the goals of long-term energy and climate policy, the contribution of the industrial sector is important. Upgrading low temperature industrial waste heat using electric high-temperature heat pumps (HTHPs) can improve the overall energy-efficiency and mitigate CO2 emissions by replacing fossil fuels. The pulp and paper and the food and beverage industries use significant quantities of heat up to 200 °C and therefore have a high potential for the application of HTHPs. In order to assess the role of HTHPs, a techno-economic bottom-up cost optimization model is developed building on the Swiss TIMES Energy system Model (STEM). We present an advanced modeling framework including energy and material flows, with a high temporal resolution and a segregation of the temperature level of the process heat. The results show that HTHPs are cost-effective up to a temperature of 150 °C. Switzerland has the economic potential to deploy of about 100 MWth in the pulp and paper industry and 900 MWth in the food and beverage industry by 2050. Incentivizing the exploitation of this significant potential will require very high CO2 prices of several hundred €/tCO2 or additional policies to overcome investment barriers by supporting investment and flexible system-serving operation of heat pumps.