BSRIA experts delivered the presentations during the evening of Tuesday March 13.
Aline Breslauer, senior market intelligence analyst, kicked off with a presentation on the changes occurring in the heating markets. Although still a high value market, due to the progression of the condensing technology and growth in the heat pump market, Europe is no longer the biggest heating market region worldwide.
Growing by 20 percent in 2017, Asia-Pacific and particularly China is the “rising star”, hosting the largest boiler and heat pump markets. The Asia-Pacific region also includes the high value Japanese heat pumps segment.
Ms Breslauer said: “The main drivers of the global heating markets are energy efficiency legislation for buildings and products, energy transition and distributed energy generation, urbanisation and the increasing share of blocks of flats, as well as digitalisation.
“The policy push for heat pumps in new build is very clearly showing positive results. It is also clear that the problems related to the adoption of heat pumps in the wider context of existing homes are far from being resolved.
“Another key trend is the shift towards communal heating and district heating systems which support the increasing sales of heat interface units.”
Anette Meyer-Holley, manager VAC&R and private client, highlighted that the size of the global air conditioning sector is more significant than heating, renewables and building automation and controls systems (BACS) put together.
The global air conditioning market is dominated by splits, which is a reflection of the large Asian markets, where splits also act as a heating product. She noted that this should be viewed as a guide only, as major heating markets are not significant air conditioning markets and vice versa.
Ms Meyer-Holley added that China continues to dominate the air conditioning markets, followed by the US and Japan. The Chinese market has been boosted by the latest five-year plan, as well as a hot summer which resulted in restocking at distributor level and in incentives to switch to more environmentally friendly equipment.
After the global overall drop in sales in 2016, primarily due to the impact of the slowdown in China, BSRIA has seen a recovery in 2017, with estimated total volume sales reaching 136 million air conditioning units.
Ms Meyer-Holley said: “Splits are the most significant market globally, with sales expected to reach around 113 million outdoor units exclusive of VRF in 2017. China and Asia Pacific account for 70 percent of global sales, with China holding dominant position in the market; hence, what happens particularly in the Chinese market has an impact on the global trends. VRF continues to do well with growth of over 20 percent expected in 2017 supported by the picking up of the overall construction markets that have seen a modest growth of two percent in 2017.
“These trends occur in the greater context of the uncertainty surrounding phasing out HFC refrigerant gases. There was a continued surge in refrigerant prices in 2017, with the price for fluorite reaching a six-year high last year. In addition, tax implementations in Europe makes for a very uncertain 2018 with open questions on how the introduction of new refrigerants will impact on the availability of units (and more importantly on their costs) and how much this will impact the prices of the actual air conditioning units. It is certain that in the medium/long-term this is not just a European issue and that changes will happen at a global level.”
Henry Lawson, senior market research consultant, focused on the changes in the BACS market and the progression of the Internet of Things (IoT) in building services.
He said: “The global smart building market was worth around US$30 billion and it includes BACS, Building Energy Management Systems (BEMS), Smart Connected HVAC and Smart Homes.”
Presenting the latest trends in BACS, highlighting that IP is becoming the norm and wireless solutions are becoming less of a niche, Mr Lawson explained that a “significant share” of smart home products in fact is installed in non-residential applications. He concluded that the global smart buildings market is growing to reach almost USD 70 billion by 2021 and that software and analytics will become increasingly important.
The evening of BSRIA presentations concluded with Krystyna Dawson, business manager, WMI, who stated that among all the important global trends, four currently have a major impact on the HVAC markets: energy transition and urbanisation, due to their impact on markets’ product choice; and digitalisation and commoditisation, as they increasingly shape consumers’ expectations in all aspects of life.
Following the Paris Climate Agreement in April 2016, all major world regions have already adopted targets for significant cuts of CO2 emissions until 2030. Legislation that should help in achieving the set goals is also partly in place, and embraces promotion of and investments in clean power generation, distributed energy generation, and the uptake of electric vehicles, and also strengthens standards for buildings and HVAC products.
Ms Dawson said: “In this context BSRIA sees advances in provision of smart services in buildings, although their progress is hampered by the fact that advantages related to these technologies do not necessarily benefit those who have to pay for them in a direct way, as buildings have many stakeholders. Sociological changes prompted by digitalisation also start having a profound impact on the way products and services are channelled to the market.”