The heating market - Spain (2023)

1.2 The global market

The global market for heating equipment will grow steadily between **** and ****. In ****, the market was worth $**.** billion. By ****, it had risen to $**.** billion, an increase of **.*%. In ****, the market value is estimated at **.** billion, up *.*% on the previous year. In ****, the market should continue to grow, reaching **.** billion, an increase of *.*%. In ****, the market value will increase by *.*% to **.** billion. Finally, in ****, the market will continue to grow, reaching **.** billion, an increase of *.*%. Over the entire period, the compound annual growth rate (***) of the equipment market is expected to be *.*%.

Global heating equipment market trends World, ****-****, billions of dollars source: thebusinessresearchcompany

1.3 The domestic market

The heating sector in Spain has seen a contrasting evolution in terms of sales between **** and ****. After a slight drop of *.*% between **** (***), the sector saw a sharp rise of ***% in ****, reaching *** million euros. This growth continued in ****, with an increase of **.*%, taking sales to *,*** million euros. The sector's dynamism can be explained by a European Commission directive aimed at ending the central heating system. This directive was implemented in Spain in May **** [***]

Sales trends in the Spanish heating sector Spain, **XX-****, millions of euros Source: ****

In terms of heating market sub-segments, heat pumps, electric water heaters and oil-fired heating were the segments driving market growth between **** and ****.

Sector sub-segments Number of sales **** **** % change ****-**** Wall-mounted boilers (***) ***.*** ***.*** -*,**% Multitasking heat pumps (***) **.*** **.*** **,**% Electric water heaters (***) ***.*** ***.*** *,**% Radiators (***) *.***.*** *.***.*** -**,**% Floor-standing boilers (***) **.*** **.*** -**,**% Underfloor heating (***) *.***.*** *.***.*** -*,**% Tanks (***) **.*** **.*** *,**% Gas heaters (***) ***.*** ***.*** - **,** % Heat pumps for domestic hot water only (***) **.*** **.*** **,**% Solar collectors (***) **.*** **.*** -*,**% Thermostats (***) ***.*** ***.*** -*,**%

Source: ****

1.4 Spanish energy mix

The Spanish government has set targets for changing the country's energy mix by ****. Compared to ****, fossil fuels are set to decrease by **% to **.*** million tonnes of oil equivalent. Nuclear power generation is set to fall by **% to *.* million tonnes of oil equivalent. Other forms of energy, which accounted for *,*** million tonnes of oil equivalent in ****, are scheduled to be phased out completely. By contrast, the share of renewable energies is set to almost double, from **,*** to **,*** million tonnes of oil equivalent, an increase of ***%.

Spanish primary energy mix Spain, ****-****, million tonnes of oil equivalent Source: ****

These changes to the energy mix also involve energy savings. In the residential sector, the aim is to reduce energy consumption by **%. In the tertiary sector, the target reduction is **%. The transport sector is where the greatest effort is required, with a reduction of **%. For industry, the target is to reduce energy consumption by **%. Lastly, the agricultural sector is expected to achieve energy savings of *%.

Energy savings forecast by sector in Spain Spain, ****, % of total energy consumption Source: ****

In the residential sector, these energy savings translate into a reduction of *.*** million tonnes of oil equivalent through improved energy efficiency in buildings, and a reduction of ...

2.1 The state of the Spanish real estate market

In ****, Spain had a total housing stock of **,***,*** homes and offices. Of these, buildings with more than ** apartments account for **.**% of the total Spanish housing stock. Buildings with * to * apartments account for **.**% of the total, and two-family homes for *.**%. Finally, office buildings are in the minority, with a share of *.**%.

Breakdown of housing types in Spain Spain, ****, in thousands Source: ****

In terms of housing type, multi-family dwellings make up **.**% of the Spanish housing stock, while single-family dwellings account for **.**%.

Breakdown of buildings/houses Spain, ****, %, %, %, %, %, %, %, %, %, %, %, % Source: ****

A goal of rehabilitating the building stock:

Insulation is a subject linked to heating. In ****, Spain's housing stock was found to bevery old and below insulation standards, which represents a potential demand for the sector, since the renovation of insulation can be linked with an effective change of heating system, always with the aim of saving money. In ****, only *% of homes were considered "efficient" in terms of consumption standards. In ****, therefore, no less than **% of homes required insulation work.

Breakdown of housing types in Spain by energy quality Spain, ****, % Source: ****

Finally, the table below shows the energy quality of energy-certified homes in Spain, by Autonomous Community. Just under * million homes have been certified. On a national ...

2.2 Current heating structure in Spain

The map below shows Spain's climate zones. They have been defined by the CTE, the technical building code that governs Spanish insulation standards. The blue zones correspond to cold, mountain climates, while the zones tending towards red represent warmer climates. Heating demand is therefore determined by this climatic reality, and will be higher in areas requiring better insulation.     Source: ****

In ****, **.*% of Spanish homes were equipped with a heating system.

Main dwellings equipped with a heating system in Spain Spain, ****, % of total Source: ****

Among these equipped homes, natural gas was the energy system preferred by Spaniards, with **.*% of homes equipped with this heating system. Electric heating accounted for **.*% of homes, while oil heating was used by **.*%. Finally, **.*% of Spanish homes were heated with other types of heating.

Type of heating used Spain, ****, % of total

In ****, the percentage of homes equipped with a heating system in Spain varies considerably from one autonomous community to another. The least equipped regions are the Canary Islands (***). These data highlight the geographical disparities in heating equipment in Spain, with the least-equipped regions mainly located in the south and on the islands.

2.3 Typology of demand

Between **** and ****, there is a general downward trend in consumption in thousands of Ktoe, with some fluctuations. After a peak of **** in ****, there was a significant drop of **% in **** to ****. This value remained stable in ****. In ****, a slight increase of *% was noted to reach ****. However, in ****, a decrease of *% was recorded, bringing consumption to ****. In **** and ****, a slight increase was observed, with a rise of *.*% in **** (***). Spanish heating consumption Spain, ****-****, thousands of oil equivalents Source: ****

This relatively stable demand for heating since **** is combined with the cost of heating. When you consider that it accounts for an average of **% of Spanish energy expenditure, it's easy to see how the desire to reduce energy costs could be an additional demand for the heating sector.

Spanish energy costs Spain, ****, % of energy budget Source: ****

3.1 Value chain

The graph below shows the value chain in the Spanish heating sector:

The stages in this value chain include the following:

Equipment manufacture: Spanish manufacturers produce a wide range of heating equipment, including boilers, radiators, heat pumps, solar thermal systems and systems based on renewable energies. Distribution: Heating equipment is distributed in Spain by wholesalers, specialist distributors and retailers. Installation: Professional installers, such as heating engineers, are responsible for installing heating systems on customers' premises. They ensure proper installation that complies with Spanish safety standards. Maintenance and after-sales service: Manufacturers, installers and specialized companies offer maintenance, repair and technical support services for heating systems in Spain. This ensures optimal operation and long equipment life. Energy supply: Energy is supplied by energy suppliers, who deliver the various energy sources to consumers. Energy sources commonly used for heating include natural gas, propane, electricity and renewable energies. Final consumption.

3.2 Production

The number of companies in CNAE code ****, which corresponds to "Manufacture of radiators and boilers for central heating", has fluctuated over the past six years. Comparing annual data, there was a **.**% increase from **** to ****, followed by a **.**% drop in ****. In ****, the number of companies rose slightly by *.**% compared to ****, followed by a more significant increase of **.*% in ****. Finally, in ****, there was an increase of *.**% on ****.

Trend in the number of companies with CNAE code: **** Manufacture of radiators and boilers for central heating. Spain, ****-****, millions of euros Source: ****

The number of employees in CNAE code **** "Manufacture of radiators and boilers for central heating" has undergone different evolutions between **** and ****. There was a slight increase of *.**% between **** and ****, followed by a decrease of *.**% in ****. In ****, the number of employees rose by *.**%, but then fell by **.**% in ****. Finally, in ****, there was a *.*% increase on the previous year.

Trend in the number of employees in CNAE code: **** Manufacture of central heating radiators and boilers Spain, ****-****, number of employees Source: INE Sales of CNAE code **** "Manufacture of radiators and boilers for central heating" have undergone several changes between **** and ****. From **** to ****, it increased by **%, from ***.*** million euros to ***.*** million euros. From **** to ****, it grew ...

4.1 Types of heating systems

There are two main categories of heating systems: "centralized" and "decentralized".[***] 

Source: ****

Centralized" systems are made up of three components:

the generator that produces the heat ; the distribution system, which transports this energy from the generator to its place of use (***); the emitter, which delivers the heat to the user.

Decentralized" systems do not include these three components. Heat is generated and emitted directly on site. The most widespread decentralized system is electric heating.

Technical characteristics

The energy performance of heating systems is characterized by an efficiency expressed in % or coefficient of performance (***). The rated power Pn, expressed in kW, is the maximum power that a boiler, stove or insert can deliver continuously.

Direct electric heating has a coefficient of performance close to ***% in terms of final energy, or around **% in terms of primary energy. Direct electric heating has very low installation and maintenance costs, and as electric energy is relatively expensive, households manage this mode of heating to save money. [***] In the domestic sector, biomass appliances achieve efficiencies on PCI close to **% if fuelled with logs, and **% if fuelled with pellets. Condensing boilers (***) are the most efficient boiler technology, ahead of low-temperature and standard boilers. Its efficiency is close to ...

4.2 Prices

Energy prices in Spain. We can see that this rise in prices may prompt Spaniards to change their heating habits.

Price index base ***, **** for electricity, gas, steam and air conditioning Spain, ****-****, index base ***, **** Source: ****

The table below shows the cost of different heating systems:

Type of heating Costs Gas-fired heating Condensing boiler: from €*,*** to €*,*** Natural gas installation and connection: €*** to €*** Installation of * radiators: €*** Total cost of installation: €*,*** to €*,*** Oil-fired heating Tank installation: from €*** to €*,*** Boiler: from €*,*** to €*,*** Boiler installation and certification: €*** Installation of ** water radiators: €*,*** Total cost of installation: approx. €*,*** Geothermal (***) Geothermal collection: approx. €*,*** Technical room: €**,*** Total installation cost: approx. €**,*** Aerothermal with underfloor heating (***) ** kW heat pump: from €*,*** to €**,*** Total installation cost: approx. €**,*** Biomass boilers from €*,*** to €*,*** (***) Biomass boilers: complete installation with boiler and radiators over €*,***

Also below, prices for heating system installation:

Type of heating Installation costs for a ***m* dwelling Installation of natural gas heating and radiators * *** € Installation of oil-fired heating and stoves * *** € Installation of electric heating and radiators * *** € Installation of biomass heating and stoves * *** € Installation of underfloor heating * *** € Installation of aerothermal heating and radiators * *** € Installation of heat pump heating * *** €

Source: ****

4.3 Supply trend: the digitalization of heating

Intelligent heating is a system that enables us to control the temperature and comfort in our homes remotely via mobile devices. These systems connect to the Internet of Things (***) and aim to deliver smarter, greener heating, improving energy savings and efficiency.

Advantages of having an intelligent heating system at home:

Freedom: Allows you to control the heating from anywhere, offering greater flexibility and the ability to adjust the temperature in case of unforeseen circumstances. Comfort: Remote programming anticipates the user's movements, allowing the heating to be switched on before arriving home. savings: Remote control avoids forgetfulness and wasted energy by keeping the heating on when it's not needed. Modulation technology adjusts power as needed, saving energy. Helping the environment: By being able to check and turn off the heating remotely, you avoid unnecessary energy consumption and help preserve the planet.

* ways to get smart heating:

Nest smart thermostats: widely used, they have delivered significant energy savings. Netatmo models: save up to **% on heating bills. Tado smart heaters: offer savings of up to **% and are growing on the market. Momit: a Spanish brand that also optimizes air-conditioning consumption.

Source: ****

5.1 The end of the central heating system :

Directive ****/**/EU on energy efficiency makes it compulsory to install individual metering systems for heating, air conditioning and domestic hot water from May *, ****. Its main aim is to improve the energy efficiency of buildings based on individual consumption. This means that each building user only pays for the amount of energy they consume, enabling them to adjust and optimize their energy use, ensure adequate comfort, avoid unnecessary costs and reduce the building's carbon footprint. Its installation can lead to an average saving of **% on total building expenditure,

Which buildings are required to install individual heating meters?

This decree is designed to transpose several European directives, including Directive ****/****, which makes it compulsory to measure heating consumption and individualize this measurement in buildings with centralized heating systems, which implies the installation of heating cost allocators and thermostatic valves in thousands of homes.

The text establishes the obligation for final heating and air-conditioning customers to install individual meters, insofar as this is technically viable and economically profitable, to enable them to know and optimize their actual energy consumption. Buildings located in milder climatic zones, i.e. those defined as A and B in the CTE (***), are exempt from the application of these measures, as ...

6.1

• Leroy Merlin Espagne
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