13 October 2021
The UK water heating market is expected to return to growth in 2021, according to the latest report from AMA Research.
Following the outbreak of Covid-19 in 2020, the market saw a decline of around -13%, with new housebuilding the most severely impacted of all construction sectors during the first lockdown. There was also a decline in every non-residential end-use sector, but particularly in retail.
The UK water heating market is primarily influenced by levels of residential and non-residential construction, heating refurbishments, the impact of climatic factors, the relative levels of fuel prices, trends in hot water consumption, the development of connected and renewable technologies, also changes in building and energy efficiency legislation. Now that the UK has left the EU, trade deals with UK trading partners will also have a significant influence on market prospects. The impact of the Covid-19 pandemic is also likely to be substantial, particularly in the short-term.
Environmental factors that can influence and drive the UK water heating industry include the development of energy efficient solutions and those that use renewable sources of heat. Abdul Tantouch, research manager at AMA Research, said: “With the government drive towards net zero carbon emissions, there will be an increasing focus on renewable technologies, particularly heat pumps and solar energy. This development will have considerable impact on the type of residential and commercial water heating systems specified.”
The UK water heating market saw moderate growth of 1-3% per annum in the four-year period 2016-2019 despite the economic uncertainty surrounding the Brexit transition process. The market benefited from opportunities across a number of non-residential end-use sectors, in particular offices, entertainment & leisure, industrial, education, and health. New housebuilding activity also remained positive with the ongoing housing shortage driving demand for new housing of all tenures, in particular social rent, affordable rent and private rent.
AMA says there is currently a high level of uncertainty in the UK economy as a result of Brexit and also Covid-19. However, the UK water heating market is estimated to return to growth, with the widespread rollout of the Covid-19 vaccine and possible pent-up demand driving sales going forward.
It adds that market opportunities will arise from product innovation and technological developments that will lead to an overall increase in system efficiencies. The evolution of smart water heating solutions with the increased requirement for interoperability and remote control of intelligent systems will also support market growth.