Focus Incentives and Funds
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UK low carbon heat market: in 2016 more than doubled the annual value
This growth is due to the Renewable Heat Incentive (RHI), to be launched in 2014
According to Delta-ee forecasts the market for residential low carbon heating products - solar thermal, air and ground source heat pumps, micro-CHP, biomass and hybrid technologies – is going to progress.
In fact, in 2016 the annual installations of these kind of products will rise of 50,000 units, reaching the quantity of 80,000, doubling the current value up to £0,5 billion.
Considering market players, there exist numerous figures who will be affected by those solutions:
In fact, in 2016 the annual installations of these kind of products will rise of 50,000 units, reaching the quantity of 80,000, doubling the current value up to £0,5 billion.
The cause of this growth is to be found in the Renewable Heat Incentive (RHI) to be launched in 2014. In particular, what really helped the low carbon heat market not to be flat anymore, by removing uncertainty, was the tariff announcement. In this way, industry participants will develop new customer propositions and invest in supply chains.
Anyway, to grow it is necessary to expand into new market segments such as, for example, social housing and new building properties in which sales are currently concentrated, accounting 77% of installs; while by 2016 owners occupiers will grow their market share to over 40% of them.
In this sector, uptakes will arrive through paybacks just in case households take advantage of the RHI and the companies proposing solutions for these households will be the growing low carbon heat market’s winners.
In this sector, uptakes will arrive through paybacks just in case households take advantage of the RHI and the companies proposing solutions for these households will be the growing low carbon heat market’s winners.
In technology terms, the low carbon heating market will be increasingly dominated by heat pumps with a growth from 15,000 per year today to 45,000 per year in 2016. Those consumers currently using heating oil can find a good alternative in air source heat pumps. Even for on-gas costumers, hybrid heat pumps included in the RHI will become an innovative low carbon solution.
Considering market players, there exist numerous figures who will be affected by those solutions:
· for energy suppliers this means an important opportunity and some of them are already developing low carbon solutions;
· for boiler manufacturers this can be the moment for producing hybrid heat pumps, following Vaillant which already has one;
· concerning low carbon product manufacturers, for them it will be an opportunity to introduce innovative propositions for off-gas grid owner occupier customers;
· in the end, for installers it means great opportunities to grow and diversify business.
Delta Energy & Environment (Delta-ee) is a research and consulting company that provides its clients with information, analysis, insight, advice in emerging decentralized energy markets, commercial insight and market expertise in decentralised energy and low carbon strategies.
