The Indian water heaters market is projected to surpass Rs 400 crore by 2023, with manufacturers developing innovative products that consume less energy.
Water heating has always been important with modern versions; still the most common type is in use. While water heater technology has advanced, these systems have remained essentially the same in concept since they were first invented – heat a tank of water to the desired temperature, and then keep it hot, so it is available when it is needed; albeit there are newer, better, and far more efficient systems available now. The water heating sales industry has witnessed significant change over the last five years. Growth in the market is led by increasing number of new residential units and other construction activities, coupled with rising per capita disposable income. Moreover, improving standard of living, technological advancements, and rising demand for low-cost and efficient water heaters is further expected to propel growth in Indian electric water heaters market over the next couple of years.
2018. The current penetration level of water heaters in India is at 10 percent. Growth in the market is led by increasing number of new residential units and other construction activities, coupled with rising per capita disposable income. Moreover, improving standards of living, technological advancements, and rising demand for low-cost and efficient water heaters is further expected to propel growth in the Indian electric water heaters market over the next five years.
The Indian water heaters market in 2017-18 is estimated at Rs 1988 crore, a 5.2 percent increase since 2016-17. The electric storage heaters lead the segment with a 59-percent share of the market. Though electric water heaters dominate the market, with an 85-percent share, solar water heaters are finding increased popularity among Indian consumers over the past few years.
Increasing demand for reliable, eco-friendly, and cost-efficient technology for hot water preparation is driving the solar water heaters segment. Its ability to offer low running cost makes its adoption preferable over its other counterparts. Improving infrastructure and rising availability of piped water facility across the rural regions in India are expected to drive adoption of solar water heaters in the country over the next five years. Implementation of GST is expected to have a positive impact on the organized solar water heater players operating in the country. The country is also witnessing a strong demand for polymer-based storage tanks, which provide better insulation and high resistance to corrosion.
Global market dynamics
The global water heaters market size for 2017 was over USD 25 billion and the annual deployment is set to exceed 150 million units by 2024. Rapid urbanization, coupled with growing demand for energy-efficient heating systems, will drive the global market size. Ongoing economic transformation across the developing economies, owing to increasing spending toward the development of new and advanced technologies, will stimulate the product adoption. In 2017, as per the UNCTAD, the world will cater over 70 percent of the global population in urban areas by 2050.
Considerable investments toward infrastructure development, coupled with rising demand for reliable, eco-friendly, and cost-efficient heating systems, will positively influence the market growth. In addition, accelerating demand for advanced solutions on account of improving living standards, primarily across the emerging economies, will complement the business outlook. Government initiatives toward the adoption of renewable systems with an aim to limit carbon emissions will accelerate the global market growth. Consumer awareness pertaining to operational benefits of advanced heating solutions over their existing counterparts will stimulate the business growth.
Higher efficiency, along with convenient and easy installation, is one of the vital parameters stimulating the electric water heaters market growth. The instant water heaters market is anticipated to grow on account of efficient energy utilization, coupled with rising demand for quick hot water supply. The gas water heaters market will grow on account of quick hot water supply along with limited operating cost. The solar water heaters market will grow on account of introduction of government incentives and subsidies toward the adoption of sustainable systems.
Increasing demand for energy-efficient systems, coupled with introduction of initiatives to reduce the environment concerns, will boost the US water heaters market growth. Stringent regulatory policies owing to carbon emissions along with strong emphasis on the adoption of fuel efficient technologies will stimulate the United Kingdom’s market growth.
Energy efficiency, cost effectiveness, and requirement of less storage space are among the crucial needs of customers willing to install water heaters. They are introducing innovations and advancements in the existing technology to substantially increase their product demand. Various mergers and collaborations among the industry giants are complementing the business growth, with primary focus on increasing the market share and facilitating efficient water-heating systems to their customers. Key companies developing water heaters are also focusing on anti-corrosion, filtration, and sterilization technology. Providing clean and soft water through water heaters is also being focused on. Electric water heaters that are easy to install and require minimum maintenance are also being developed by manufacturers. Heat pump technology and condensing gas-fired systems are some of the innovative technologies. Solar and geothermal equipment are also being incorporated by manufacturers in their product line. Consumers are moving toward adopting higher-efficiency water heaters as part of the replacement. Manufacturers are seeing a lot of potential in the solar market; hence, solar water heaters are also being developed.
Electric heaters emerge as the most preferred segment
Electric water heaters are a result of innovation in terms of design and efficiency. The sales of electric water heaters have increased drastically, and this has influenced the vendors to introduce new products. These water heaters are made up of the latest technology that makes these products of the premium category. The technological innovation leading to product premiumization is expected to be one of the major factors driving market growth. In recent times, the rising competition and demand for innovative and efficient products compel vendors to invest in R&D. Thus, the competence of the manufacturers increases innovation which in turn, drives product acceptance.
Energy conservation propels adoption of gas water heaters
The global gas water heaters market is set to exceed 30 million units by 2024. The market is betting big on the global energy spectrum driven by the lower operational cost and convenience associated with these water heaters. Rising concerns toward energy conservation have further propelled the adoption of gas water heaters in the households as the product consumes minimal energy during the heating process. The technological advancements pertaining to electronic thermostats and digital temperature control have garnered huge profits for the gas water heaters industry. Several companies are exploiting renewed market opportunities in this fraternity and are focusing toward a more sustainable and diversified product spectrum.
Solar water heaters market accrues remarkable proceeds
The global solar water heaters market is expected to grow at a CAGR of 9 percent by 2025. This can be attributed to increasing energy prices, growing global population, and rising demand for energy-efficient water heaters. Strict government regulations to curb greenhouse gases emissions, along with growing demand for water heating systems – especially in colder regions, is predicted to augment adoption of these systems and boost industry growth. In terms of revenue, commercial segment is expected to exhibit a CAGR of 9.1 percent. Substantial growth in commercial construction is anticipated to contribute significantly to industry growth.
Attractive market opportunities in connected water heaters market
Smart water heaters are also gaining popularity in the global market for water heaters. The global smart connected residential water heaters market is expected to grow at a CAGR of 10.06 percent during the period 2017–2021.
Water heating is considered as the top energy expense in the home. However, homeowners are looking for better water heaters to reduce their monthly bill. Water heaters are still undergoing many changes as a number of factors continue to shape storage-type and tank-less water heaters design. This is leading the manufacturers to develop innovative products that consume less energy. With consumers moving toward adopting tank-less and high-efficiency water heater technology, the manufacturers are focusing on redesigning their products to maintain their position in the water heaters market. The biggest single trend shaping water-heating products is technology – specifically connectivity and the ability to remotely monitor the equipment. As water-heating connectivity evolves further, contractors may soon have the opportunity to stay connected remotely to every product they install and offer value-added services when water heaters are due for maintenance. Connectivity is expected to have a growing presence for both residential and commercial water heaters. Some of that connectivity will be designed to enhance the user experience as well as increase a contractor’s ability to support and service their residential and commercial customers’ water heating products. Meanwhile, governments in different countries are also encouraging the use of natural sources of energy, thereby driving the demand for solar water heaters. Energy-efficient hybrid water heaters are also being developed on a large scale by manufacturers.
Based on market research conducted by TV Veopar Journal in October 2018.