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The Enormous Scope of European Hydronics


Dan Holohan
July 16, 2009
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In 1999, I went to ISH, the world's largest plumbing & heating show. They hold it every other year in Frankfurt, Germany and I always go. Before I left that year, I was invited to a press conference in New York City to hear Andreas Lücke speak about the upcoming show. Mr. Lücke is the Managing Director of the Association of Central Heating, the Managing Director of the Federation of German Heating Industry, and the General Secretary of the European Heating Boilers Association, which is why I really wanted to hear him speak. Unfortunately, the press conference was canceled at the last moment. The folks in charge did send me the text of the speech Mr. Lücke would have delivered, however, and I found his facts and figures both fascinating and revealing.

Here, compare their market (and motivations) to ours.

  • The European plumbing & heating market (since the dismantling of the Iron Curtain) now reaches from the Urals to the Atlantic. The 700 million people living in this area make up the largest market in the world for sanitation, heating and air-conditioning products.
  • Even though the living standards, the habits, the life-styles, and the climatic conditions in this huge market differ, the demands for housing technology products are very similar. Hydronic heating clearly dominates this region, while it is the exception in the United States, where warm-air heating dominates with 93%. Also, air-conditioning plays a much smaller role in this market than in the United States and Canada.
  • Another characteristic of the European market is the trend toward comprehensive environmental and energy policies. The overall goal of these policies is to radically sink emissions and reduce consumption to protect our resources.
  • In the past 25 years, Western Europe has quickly converted from coal to oil and gas. Eastern Europe is following this example. The demand in Central and Eastern Europe for more modern, safer, more efficient, and more comfortable gas and oil technology is correspondingly high.
  • Since the fall of the Berlin Wall, Germany has become the largest market by far in Western Europe for sanitation, heating and air-conditioning products. The market for heating technology is estimated at about $8 billion (US) and for sanitation products at a good $9 billion (US). In Germany, renovation affords the largest potential, producing a good 70% of the business for heating as well as for sanitation. The boiler market amounts to about one million units per year.
  • The heating market has developed dynamically in France during recent years. About 750,000 boilers were installed during 1997. In contrast to the heating structure in German (where about 85% of buildings are heated with hydronics), electrical heating plays an important role in France. About 45% of the new buildings are heated electrically. However, gas and oil are preferred in renovated buildings throughout France.
  • The boiler market in Great Britain also developed positively in 1997.
  • In Italy, about 900,000 boilers were sold during 1997.
  • The Polish market, with a population of about 40 million, is growing vigorously. This is related to the switch from coal (previously 80% of the heating systems) to natural gas. Along with this, the demand for comfort is increasing among Polish people so that the sanitation field is also registering a substantial growth rate. That also goes for the Czech Republic (11 million people) and Hungary (12 million people).
  • Business in the Baltic States is developing dynamically, as well. Up to now, Russia and the Ukraine have been exceptions, but they view the Ukraine (with a population of more than 50 million and facing a major ecological challenge) as an excellent market opportunity in the near future.
  • During the past five or six years, trade relations with Russia have developed very positively. Here, too, the change from coal to oil and natural gas is taking place. The demand for comfort is increasing so that the entire sophisticated housing technology market is profiting. They consider the enormous market potential in Russia as a long-term opportunity.
  • Housing technology will play a central role in reaching the Kyoto goal of conserving resources and, in industrial countries worldwide, reducing C02 an average of 5% from the 1990 levels by the year 2008 or 2012. In northern countries with cold climates, up to 40% of the primary energy consumption is for heating. In countries such as Germany, Denmark and Holland, this means a higher share of primary energy consumption for heating than for private motor vehicles. The enormous savings potential in this field cannot be equaled by any other energy sector. That explains the increased focus of the past few years on housing technology, especially heating.
  • The solution in Europe is a European environmental and energy policy with strict requirements for energy-consuming equipment such as boilers.
  • A further theme is the thrifty management of the scarce resource water, which in many regions of the world is already becoming a question of survival.
  • A market revolution in regenerative energy is taking place, at least in Europe. Solar heating, especially, should be mentioned - that is, the use of the sun to warm water and even to support boilers. It is exclusively a hydronic system that can be ideally combined with conventional oil and gas boilers. In Germany, the growth rate for solar heating units is more than 20% per year.
  • The (water-source) heat pump is also making inroads at ISH. Popular during the energy crisis of the Seventies, it disappeared from the market as energy prices sank. Today it is making a comeback.

Now, by way of contrast, consider that the total annual production of boilers in the United States hovers somewhere around 350,000 units. We live in a nation heated primarily by furnaces.

I was in a woman’s home in Germany a few years back when this guy from the German government showed up unannounced. He had a combustion-efficiency test kit with him. She let him in because she had no choice. He went right to her basement. A while later, he came back upstairs and told her that her boiler had passed the test. She looked relieved.

When I asked her what that had been about she told me that a Chimney Sweep (which is what that guy was) shows up every six months in every German citizen's home. He always comes unannounced. He's there to make sure they're not polluting the air. She took me to the basement and showed me the sticker the Chimney Sweep had placed on her boiler. There was a row of those stickers. So far, her heating equipment had passed every test.

"What if your equipment doesn’t pass?" I asked.

"They give you two weeks to fix it," she said.

"And suppose you don’t feel like having it fixed?" I asked.

"They take your boiler," she explained with a laugh.

How’s that for a law with teeth?

In Europe, the people are trying their best to do something about greenhouse gasses. They're looking at those millions and millions of boilers as being the fastest way to lower the release of CO2 into the atmosphere. They’re paying more attention to the boilers than they are to the cars because they have so many boilers. We have far fewer boilers in North America, but we have a lot more cars. So we pay a lot of attention to the cars.

What’s going on in Europe with all this new hydronic heating equipment is about the environment, not about the price of heating fuel. The reason why we don’t see the full range of European heating equipment heading our way is because the Europeans don’t consider America to be a major player when it comes to hydronics. The same things do not motivate us because we don't have as many boilers burning gas and oil. And for the most part, they don't know what a furnace is.

Some food for thought.