As global awareness of the impact of building energy consumption on climate change has increased, a number of countries have announced supportive policy measures and mandates for transitioning all new construction to nearly-zero energy. However, for companies looking to find growth opportunities, it is critical to distinguish policy rhetoric from adoption reality. With most countries still lacking a clear definition of “nearly-zero” or policies with genuine incentives or punative ‘teeth’, forecasting the hotspots where growth opportunities exist is non-trivial. To be clear, no country will meet its 2017 targets for nNZEBs, but partial adoption will propel the nearly-Net-Zero Energy Buildings (nNZEB) floor space from 12 million m2 in 2012 to 80 million m2 by 2017, creating a $16.5 billion materials market.
While Europe dominates today, incentives in Korea, China, and India propel Asia-Pacific to an annual 31.4 million m2 by 2017. Numerous factors contribute to the region’s growing importance including energy security concerns in India, carbon tax in China, and cap-and-trade and an imminent national Passivehaus adoption target in South Korea, each of which directly or indirectly drive implementation and pursuit of announced targets for nNZEBs. In all, Asia- Pacific’s share of annual nNZEB installations will rise from 23% in 2012 to 39% in 2017.
In terms of technology, while the likes of cool roof coatings and air barrier materials will grow robustly from a modest base, high-R value glazing and daylighting skylights accounting for 86%, or $14.2 billion, of the total market for building envelope materials. High-R value glazing alone will be an $8.2 billion market, dominated by double-pane constructions as higher cost, thickness, and weight will keep the adoption of triple-pane glazings limited. Designers will try to get triple-pane performance with double-pane designs and advanced edge sealant materials, or will look to integrate emerging technologies into glazings. Designers in India and Australia will adopt light redirecting louvers to reduce artificial lighting, while designers in the Middle East will look towards incorporating phase change materials (PCMs) in double-pane glazings to reduce the air-conditioning energy usage during peak hours.
Companies looking to grow with the nNZEB market need to plan now for tomorrow’s market in terms of technology selection, manufacturing locations and partnerships in the value chain that can yield adoption of the right materials technologies in the right geographies. Six-fold market growth in five years should be compelling to any materials company, but appropriate strategy will determine who sees the spoils of the market opportunity.
Source: Lux Research report “Getting to Nearly-Zero Energy Buildings: Ambitious Targets, Modest Progress” — client registration required.