U.S. Commercial and Institutional HVAC Equipment Markets

SUMMARY

HVAC Manufacturers are Challenged to Make More Environmentally Friendly HVAC Systems

A major issue is the use of harmful refrigerants to the environment; manufacturers are spending money in producing refrigerants acceptable by EPA standards. HVAC equipment uses different refrigerants like HC (HydroCloro), HCF (HydroCloroFluoro), and HCFC HydroCloroFluoroCarbon). The main goal is to remove the FluoroCloro portions out of the refrigerants, which are the most harmful to the environment. Manufacturers are producing blends of refrigerants with basic components and combinations of other refrigerants without the FluoroCloro molecule. Industry participants are making new refrigerants that in the long term will have a better affect on environment. The goal is to remove the harmful refrigerants from all the HVAC equipment in the industry. It is known that no matter how good the system is it will always leak, therefore manufacturers are also looking to build products that are as close to leak proof as possible. In case of leakage manufacturers want to have refrigerants less harmful to the environment. The government and EPA work hand in hand with industry participants to create better solutions.

Replacing CFC equipment is a major driver for retrofit orders in the HVAC markets. End users are becoming more concerned about the environment, in most cases enforced by legislation, and the trend to reduce hazardous refrigerants is expected to push replacement orders for chillers still operating with CFC molecules. In 1996, government banned the manufacturing of CFC components, which meant that the estimated 80,000 to 100,000 non-residential chillers using CFCs in the U.S. would need to be either retrofitted or replaced. It is estimated that in 2003 about 40,000 CFC chillers in the U.S. were still operational. The continuous need to replace CFC chillers provides ongoing opportunities for manufacturers. The new and more efficient chillers available can save end users in operating costs and energy consumptions, which further increases the incentives to replace CFC chillers. Some of the popular alternative refrigerants used and accepted by the EPA include: HFC-134a, HCFC-123, HCFC-22, HFC-410A, and HFC-407C.

More Efficiency Reducing Energy Costs is Increasing Demand for HVAC Equipment

As end-users are becoming more aware about the potential cost saving through higher efficiency HVAC systems, demand for new and upgraded HVAC products is expected to increase over the forecast period. Manufacturers are responding by creating products with more efficiency and advanced technologies. According to the U.S. department of energy, a major energy source in commercial and institutional buildings where property managers are looking to save on costs is in the HVAC systems. The energy consumption from HVAC systems accounts for approximately 40.0 percent of the energy used in U.S. buildings. HVAC equipment manufacturers are designing products with better efficiency to help property owners save on energy costs, which in turn is driving fresh demand for HVAC equipment Technological advances in efficiency have allowed owners of new equipment to save between 40.0 percent and 60.0 percent of their previous utility costs. This increased efficiency comes from improved compressor design, increased effectiveness of heat exchangers, and even new means of pumping refrigerant through a system.

Growing Demand for High-Efficiency and Packaged Unitary Equipment

The HVAC equipment industry is experiencing a growing demand for unitary equipment, as the market is moving towards smaller size, hence a favorable growth in the unitary equipment markets. Compared to other HVAC equipment markets, unitary equipment is experiencing the highest growth and taking some revenues from the applied systems markets as end users are increasingly favoring smaller packaged equipment. End-users can benefit in terms of convenience, lower initial costs, less downtime and more control over cooling or heating. End-users have the ability to install one or more smaller unitary equipment packaged with all the essentials and controls as opposed to larger applied systems that are likely to provide excess capacity. Unitary equipment controls can minimize over-cooling which tends to be more common in applied systems.

The HVAC equipment industry is experiencing a slow growth for applied systems due to an increasing demand towards smaller size. Growth of this market is expected to remain slow due to an increasing demand for multiple smaller packaged unitary equipment. Applied systems markets are expected to sustaining itself with drivers such as a strong retrofit and replacement market, and the construction of new large commercial and institutional buildings.

As the need to replace CFC chillers becomes more imminent, manufacturers are benefiting from ongoing opportunities for replacements. Additionally, new and more efficient chillers provide attractive incentives for energy savings, which further increases the demand new chillers. Air-cooled systems are experiencing higher growth potentials than water-cooled as the trend is moving towards smaller equipment and away from cooling towers and the consequences for waste water treatments. In 2004, revenues for water-cooled systems are estimated to have dropped by 2.0 percent; where as air-cooled systems have showed an increase of 4.0 percent in revenues.

TABLE OF CONTENTS

• 1. Executive Summary
  • 1. Overview and Definitions
    • 1. Overview & Definitions
  • 2. Summary of Major Findings
    • 1. Market Forecasts & Opportunities
    • 2. Analysis By Product Segment
    • 3. Competitive Analysis
    • 4. Conclusions
• 2. Total U.S. Commercial and Institutional HVAC Equipment Markets
  • 1. Total Market Overview and Definitions
    • 1. Market Overview
    • 2. Glossary of Terms
    • 3. Product Definition
    • 4. Market Engineering Measurements I
    • 5. Market Engineering Measurements II
  • 2. Competitive Landscape
    • 1. Competitive Structure
    • 2. Market Participants
  • 3. Market Dynamics
    • 1. Primary Industry Challenges
    • 2. Secondary Industry Challenges
  • 4. Market Forecasts
    • 1. Total Revenue Forecasts
    • 2. Revenue Forecasts by Product Type
    • 3. Revenue Forecasts by End User
    • 4. Distribution Channels
    • 5. Demand Analysis
    • 6. Technology Trends
  • 5. Frost & Sullivan Awards
    • 1. Technology Leadership Award
    • 2. Technology Innovation Award
    • 3. Product Line Strategy Leadership Award
• 3. U.S. Commercial and Institutional HVAC Unitary Equipment Markets
  • 1. Market Overview & Definitions
    • 1. Market Overview
    • 2. Product Definition
    • 3. Market Engineering Measurements
  • 2. Market Dynamics
    • 1. Market Drivers
    • 2. Market Restraints
  • 3. Market Forecasts
    • 1. Revenue Forecasts
    • 2. Unit Shipment Trends
    • 3. Pricing Trends
    • 4. End User Trends
  • 4. Commercial Forecasts
    • 1. Revenue Forecasts
    • 2. Unit Shipment Trends
    • 3. Pricing Trends
  • 5. Institutional Forecasts
    • 1. Revenue Forecasts
    • 2. Unit Shipment Trends
    • 3. Pricing Trends
  • 6. Competitive Analysis
    • 1. Competitive Structure
    • 2. Market Share Analysis
• 4. U.S. Commercial and Institutional HVAC Applied Systems Markets
  • 1. Market Overview & Definitions
    • 1. Market Overview
    • 2. Product Definition
    • 3. Market Engineering Measurements
  • 2. Market Dynamics
    • 1. Market Drivers
    • 2. Market Restraints
  • 3. Market Forecasts
    • 1. Revenue Forecasts
    • 2. Unit Shipment Trends
    • 3. Pricing Trends
    • 4. End User Trends
  • 4. Commercial Forecasts
    • 1. Revenue Forecasts
    • 2. Unit Shipment Trends
    • 3. Pricing Trends
  • 5. Institutional Forecasts
    • 1. Revenue Forecasts
    • 2. Unit Shipment Trends
    • 3. Pricing Trends
  • 6. Competitive Analysis
    • 1. Competitive Structure
    • 2. Market Share Analysis
• 5. U.S. Commercial and Institutional HVAC Chillers Markets
  • 1. Market Overview & Definitions
    • 1. Market Overview
    • 2. Product Definition
    • 3. Market Engineering Measurements
  • 2. Market Dynamics
    • 1. Market Drivers
    • 2. Market Restraints
  • 3. Market Forecasts
    • 1. Revenue Forecasts
    • 2. End-User Trends
• 6. Decision Support Database Tables
  • 1. Decision Support Database Tables
    • 1. Commercial Office Space
    • 2. Commercial Buildings
    • 3. Educational Facilities
    • 4. Number of Schools (elementary and secondary)
    • 5. Universities and Colleges

List Of Figures

SEGMENT 1

• Commercial and Institutional HVAC Equipment Market: Revenue Forecasts (U.S.), 2001-2011
• Commercial and Institutional HVAC Equipment Market: Revenue Forecasts by Product Type (U.S.), 2001-2011

SEGMENT 2

• Commercial and Institutional HVAC Equipment Market: Database of Key Industry Participants by Product Type (U.S.), 2004
• Commercial and Institutional HVAC Equipment Market: Industry Challenges (U.S.), 2005-2011
• Commercial and Institutional HVAC Equipment Market: Revenue Forecasts (U.S.), 2001-2011
• Commercial and Institutional HVAC Equipment Market: Revenue Forecasts by Product Type (U.S.), 2001-2011
• Commercial and Institutional HVAC Equipment Market: Percent of Revenues by Product Type (U.S.), 2001-2011
• Commercial and Institutional HVAC Equipment Market: Revenue Forecasts by End User (U.S.), 2001-2011
• Commercial and Institutional HVAC Equipment Market: Percent of Revenues by End User (U.S.), 2001-2010

SEGMENT 3

• Commercial and Institutional HVAC Unitary Equipment Market: Market Drivers Ranked in Order of Impact (U.S.), 2005-2011
• Commercial and Institutional HVAC Unitary Equipment Market: Market Restraints Ranked in Order of Impact (U.S.), 2005-2011
• Commercial and Institutional HVAC Unitary Equipment Market: Revenue Forecasts (U.S.), 2001-2011
• Commercial and Institutional HVAC Unitary Equipment Market: Unit Shipment Forecasts (U.S.), 2001-2011
• Commercial and Institutional HVAC Unitary Equipment Market: Average Unit Price Forecasts (U.S.), 2001-2011
• Commercial and Institutional HVAC Unitary Equipment Market: Revenue Forecasts by End User (U.S.), 2001-2011
• Commercial and Institutional HVAC Unitary Equipment Market: Percent of Revenues by End User (U.S.), 2001-2011
• Commercial HVAC Unitary Equipment Market: Revenue Forecasts (U.S.), 2001-2011
• Commercial HVAC Unitary Equipment Market: Unit Shipment Forecasts (U.S.), 2001-2011
• Commercial HVAC Unitary Equipment Market: Average Unit Price Forecasts (U.S.), 2001-2011
• Institutional HVAC Unitary Equipment Market: Revenue Forecasts (U.S.), 2001-2011
• Institutional HVAC Unitary Equipment Market: Unit Shipment Forecasts (U.S.), 2001-2011
• Institutional HVAC Unitary Equipment Market: Average Unit Price Forecasts (U.S.), 2001-2011
• Commercial and Institutional HVAC Unitary Equipment Market: Competitive Structure (U.S.), 2004
• Commercial and Institutional HVAC Unitary Equipment Market: Company Market Share by Revenues (U.S.), 2004

SEGMENT 4

• Commercial and Institutional HVAC Applied Systems Market: Market Drivers Ranked in Order of Impact (U.S.), 2005-2011
• Commercial and Institutional HVAC Applied Systems Market: Market Restraints Ranked in Order of Impact (U.S.), 2005-2011
• Commercial and Institutional HVAC Applied Systems Market: Revenue Forecasts (U.S.), 2001-2011
• Commercial and Institutional HVAC Applied Systems Market: Unit Shipment Forecasts (U.S.), 2001-2011
• Commercial and Institutional HVAC Applied Systems Market: Average Unit Price Forecasts (U.S.), 2001-2011
• Commercial and Institutional HVAC Applied Systems Market: Revenue Forecasts by End User (U.S.), 2001-2011
• Commercial and Institutional HVAC Applied Systems Market: Percent of Revenues by End User (U.S.), 2001-2011
• Commercial HVAC Applied Systems Market: Revenue Forecasts (U.S.), 2001-2011
• Commercial HVAC Applied Systems Market: Unit Shipment Forecasts (U.S.), 2001-2011
• Commercial HVAC Applied Systems Market: Average Unit Price Forecasts (U.S.), 2001-2011
• Institutional HVAC Applied Systems Market: Revenue Forecasts (U.S.), 2001-2011
• Institutional HVAC Applied Systems Market: Unit Shipment Forecasts (U.S.), 2001-2011
• Institutional HVAC Applied Systems Market: Average Unit Price Forecasts (U.S.), 2001-2011
• Commercial and Institutional HVAC Applied Systems Market: Competitive Structure (U.S.), 2004
• Commercial and Institutional HVAC Applied Systems Market: Company Market Share by Revenues (U.S.), 2004

SEGMENT 5

• Commercial and Institutional HVAC Chillers Market: Market Drivers Ranked in Order of Impact (U.S.), 2005-2011
• Commercial and Institutional HVAC Chillers Market: Market Restraints Ranked in Order of Impact (U.S.), 2005-2011
• Commercial and Institutional HVAC Chillers Market: Revenue Forecasts (U.S.), 2001-2011
• Commercial and Institutional HVAC Chillers Market: Revenue Forecasts by End User (U.S.), 2001-2011
• Commercial and Institutional HVAC Chillers Market: Percent of Revenues by End User (U.S.), 2001-2011