UK domestic central
heating market is substantial, with an estimated total value of around £1.1bn
at manufacturers’ prices in 2015. The market saw a notable increase in 2013,
with demand in 2014 also reasonably positive, though performance has been more
subdued in 2015/16, reflecting the withdrawal of the ECO scheme and the Green
Deal, which has affected boiler sales in particular. However, the market has
benefitted from the growth of smart heating controls in the past 2-3 years and
demand from the housebuilding sector has continued to increase.
While the market is
mature with central heating installed in around 92% of UK homes, growth
potential still exists, particularly through smart heating innovation, used to improve energy efficiency and control.
The UK domestic central heating market has also benefited in recent years from
increasing health and safety regulations, revised building regulations and
environmental legislation. This has stimulated product innovation and
development in all sectors of the market.
The widespread
introduction of smart heating controls has also supported demand, with all of
the Big 6 energy companies having added a smart thermostat to their home energy
management portfolio. UK householders are becoming much more environmentally
aware and are looking towards smart heating solutions in order to minimise
energy usage and to save money. Factors which have limited opportunities for
growth include the continuing trend towards greater levels of property
insulation, driven by further 2014 revisions to Part L of the Building
Regulations, which have tended to reduce the overall heating load.
The boiler sector
dominates the product mix with around 60% of sales, followed by radiators,
conventional heating controls and circulator pumps, with smart heating controls
accounting for a smaller but growing share. With central heating now being
mature, the largest application area is refurbishment/replacement with around
80%, while new build and first time installations account for a relatively small
share of the market. The majority of products are therefore distributed via
trade channels such as merchants and electrical wholesalers. However, DIY
multiples and online retailers are also important distribution channels, and an
increasing amount of products are sold via energy companies and into OEMs.
Keith Taylor,
Director of AMA Research said: “The
future performance of the UK domestic heating market will be influenced by
overall trends in housebuilding, home improvement, fuel prices, energy efficiency
legislation, renewable technologies, and technological developments. With the
evolving trend towards smart IoT devices in the home, the development of smart
heating controls will have a significant impact on the overall domestic central
heating market.”
There also continues
to be significant opportunities to upgrade existing boilers to the more
fuel-efficient condensing models. Around 40% of all boilers installed in the UK
are non-condensing models. However, there will still be many homeowners who
will continue to demand more conventional solutions. Real benefits such as ease
of use and convenience will continue to be the primary focus of many
conventional heating controls suppliers.
The outlook for the
UK domestic central heating market in late 2016 remains relatively flat, with
an uncertain UK economy following the UK ‘Brexit’ vote. However, more steady
growth is anticipated from 2018 onwards, driven by the replacement sector and
the increasing concern regarding energy efficiency and energy costs etc. By
2020, it is estimated that the UK domestic central heating market will have
increased by 14% in value terms, compared to 2016.
The ‘Domestic
Central Heating Market Report – Focus on Smart Heating Controls - UK 2016-2020
Analysis’ report is published by AMA Research, a leading provider of market
research and consultancy services within the construction and home improvement
markets. The report is available now and can be ordered online at www.amaresearch.co.uk or by calling 01242 235724.
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