Trends in the World Traditional & Renewable Heating Markets Krystyna Dawson BSRIA WMI June 2014
BSRIA Worldwide Market Intelligence Turnover 3.7 million for 2013 40% multi-client 60% private client including management consultancy Research across 94 countries 35 permanent multi-lingual analysts and 35 independent consultants Offices in China, US, Brazil, UK, France, Spain, Germany, partners in other countries Japan office opening shortly Global network of associates eg. JARN 2
BSRIA Regular Multi-Client Studies 2013 Renewables Worldwide Heat Pumps Worldwide Solar Thermal Micro CHP Fuel Cells Gas Heat Pumps Hybrid Heat Pumps Residential Heat Recovery Commercial Heat Pumps Commercial Solar Thermal Solar PV Air Conditioning Worldwide Review and In-depth Air handling units & fan coils Chillers Large packaged & close control Splits Windows & moveables Brand & Distribution Refrigeration & 2014 Heating Annual Worldwide Review Domestic boilers Commercial boilers Water heaters Radiators & underfloor heating HVAC 2020 Integration/overlap Smart Environmental Controls Security Lighting controls Fire Detection Smart Homes Energy Management IT Annual Worldwide Review Structured cabling Data centres Wireless Passive optical LAN IT Convergence Air Conditioning Heating Renewables Cabling Europe 11 18 14 11 Asia Pacific 11 6 6 5 Americas 4 5 3 3 Middle East, India & Africa 3 7 4 3
Policy long term impact on dwellings Europe Reduction of CO2 emissions Reduction of energy consumption Efficiency of products & systems Integration of products & systems 4 11/02/2010
Policy & incentives impact on HP sales Europe 180,000 160,000 140,000 120,000 100,000 80,000 60,000 40,000 20,000 France 0 Growth 211% Decline 40% 2006 Existing tax credit have been raised to 50% Quick rise in fossil fuel prices but low electricity price 2010 Reduction of tax credit to 25% for A/W HP (15% in 2012) Announced increase in electricity price High tax credit and FiT for PV SHW HP receive 40% tax credit (reduced to 15% in 2014) Growth 51% 120,000 100,000 80,000 60,000 40,000 20,000 0 Germany 2006 Low interest loans Lower electricity tariffs from utilities Market driven by new dwellings that was going strong 2008 HP included in market incentive program 2010 HP financial support available for existing dwellings only Quick rise of electricity prices slows market growth Growth 99% Growth 45% Decline 22% Growth 52% 5 11/02/2010
Policy & incentives impact on HP sales Japan / US 600,000 500,000 Japan Growth 242% Decline 34% U.S. End 2009 G/W/W heat pumps receive federal and state incentives. 400,000 300,000 200,000 100,000 April 2015 New federal efficiency standards of DOE: all new electric storage water heaters over 55 gallons will effectively become an air-to-water cylinder-integrated water heater. 0 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016f 2002 Japanese government financial support for CO2 water heater heat pumps. HP parts of ECO points scheme Early 2012 Government direct subsidies for HP stopped ECO points remained. ECO CUTE seen as electricity consuming product bad image 250,000 200,000 150,000 100,000 50,000 0 Growth nearly 7 X Growth 6 X 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016f 6 11/02/2010
World Heat Pump 2020 Outlook growth 60% 50% 40% 30% 20% 10% 0% Sales volume per country with CAGR 2012-2020 2012 2020 CAGR 2012-2020 22% 17% 19% 18% 18% 15% 10% 7% 4% 6% 7% 1% 51% 0% units 700,000 600,000 500,000 400,000 300,000 200,000 100,000 - growth 30% 25% 20% 15% 10% 5% 0% 27% China units 8,000,000 6,000,000 4,000,000 2,000,000-7 7
World Water Heating Markets World Water Heating, 2013 Japan 4% Saudi Arabia 3% Others 10% Europe 11% Russia 3% North America 11% Largest Water Heating markets, 2013 China 28% 30,000.0 25,000.0 India 2% Brazil 28% 20,000.0 15,000.0 10,000.0 Electric storage Gas storage Electric instantaneous Gas instantaneous ST Water Heaters Total: around 98.6 mln units (include ESWH, GSWH, EIWH, GIWH, ST WH, SHWHP) Based on BSRIA market analysis for 44 countries 5,000.0 0.0 Brazil China Europe North America Japan SHW HP 8 8
Water Heating market - Europe Water Heating market, by type of provision, 2013 Electric instantaneous 8% Gas storage 1% Gas instantaneous 8% ST Water Heaters 3% SHW HP 2% Combi boilers 34% Water Heating market by type of provision, 2010 ST systems 5% Combi boilers 36% Gas inst 10% SHWHP 0% Electric inst 8% Gas storage 1% Electric storage 43% Electric storage 44%, based on market analysis for 19 European countries 9 9 Electric storage have been the most popular product. The share of renewable WH systems is stable but SHW HP have increased at ST WH expense.
Thousands m2 World Solar Thermal 2020 Outlook Thousands m2 4000 3500 3000 2500 2000 12.3% 5.4% 6.2% 3.8% 2012 2020 CAGR 2012-2020 growth 15.7% 8.2% 18% 16% 13.9% 14% 10.4% 12% 10% 7.1% 7.1% 8% 6% 120 100 80 60 CAGR 2012-2020= 7.1% 1500 1000 500 0.3% -2.4% 0.7% 2.0% 2.5% 4% 2% 0% -2% 40 20 0-4% 0 China, 10 10
ErP - Impact on products Eco Design Labels mandatory from Sep. 2015 Dramatic decrease in sales of non-condensing boiler Fuel cell Cogeneration Gas HP A +++ 150% A ++ 125% A + 98% Ground /Water to water HP Air to water HP Increase in Combined & Hybrid systems Condensing boilers A 90% B 82% Noncondensing boilers C 75% D 36% E 34% From 26/9/2015 products with Label D to G are no longer allowed to be sold Enhanced Controls 11 11
Boiler technology shift Domestic gas & oil boiler sales, 2012-2017 000 units Inside the EU market 000 units Outside the EU market 6,000 7,000 5,000 8% 6,000 4,000 30% 5,000 3,000 2,000 70% 92% non-condensing condensing 4,000 3,000 2,000 88% 85% non-condensing condensing 1,000 1,000-2012 2017, based on the analysis of 9 largest European markets 12 15% 12% - 2012 2017, based on the analysis of Turkey, Russia, China, S. Korea 12
Domestic boilers - main world heating markets Total domestic boiler sales, 2012-2017 000 units 2,500 2,000 1,500 1,000 2012 2013 2017 500-13 13
Small cogeneration (CHP <50 kw) Total market in 2013: 20,660 units (CAGR 2009/2016: 9%) Expected decline in Japan due to competition from Fuel Cell units 16,000 8,700 (+20%) 14,000 12,000 9,900 (-2%) 10,000 8,000 6,000 4,000 2,000 1,480 (+40%) 300 (+34%) 120 (+15%) 100 (>90%) 0 Japan Germany UK Italy Netherlands France 2009 2010 2011 2012 2013 2014 2015 2016 14 14
Stationary Fuel Cell Systems - Japan PEM FC entered the market in 2009. units 200,000 180,000 160,000 140,000 120,000 100,000 80,000 60,000 40,000 20,000 0 2009 2010 2011 2012 2013F 2014F 2015F 2016F 15 Micro CHP Fuel Cells SO FC entered the market in 2012. FC old under the name of ENEFARM. Supported financially from 2009. Part of the Off-Grid Power System Enhancement Programme (BUNSANGATA DENGEN DONYU SOKUSHIN JIGYO HOJYO KIN) Government target: 1.4 million FC installations by 2020.
Stationary Fuel Cell systems- Europe European sales of Fuel Cells under 10kWe units 25,000 20,000 15,000 10,000 PEM FC SO FC 5,000-2011 2012 2013 2014 2015 2016 2017 2018 16
Thank you Contact: Krystyna Dawson Senior Manager Heating & Renewables BSRIA Worldwide Market Intelligence Direct: +44 (0)1344 465 638; Mob: +44 (0)7990 595836 Email: krystyna.dawson@bsria.co.uk 17