Condensing Unit Market Trends

Growth Drivers

• Rising demand for air conditioning and refrigeration systems globally - Over the coming decades, surface temperatures will rise worldwide due to human-induced climate change. According to climate projections, the mean surface temperature of the planet might rise by more than 2 °C by 2050 compared to preindustrial times, with considerably more variations occurring at the regional level. Therefore, the demand for refrigeration systems, and air conditions will increase and concurrently the demand for condensing units will also increase.
  
  Moreover, according to IRENA (2023), by 2050, electricity should make up 27% of all industrial final energy use. In buildings, electricity would supply 73% of the total demand by 2050, up from 34% currently, according to IRENA's 1.5°C Scenario. By 2050, 793 million heat pump units—a 14-fold increase from the 58 million ones in use today—will need to be operational.

• The rising population increasing the residential buildings -Developing countries are focusing on the infrastructural development of their residential areas. As the population is constantly growing, the demand for residential development is also increasing. In addition, people are implementing radiant heating and cooling systems in their residences
  
  For instance, while the number of housing units expanded by 21.5% between 2000 and 2020, the population of the United States increased by 17.8%. The United States' urban land area grew by 14% between 2000 and 2020.
   
• Rising demand for energy-efficient condensing units - Governments are enacting laws to encourage the use of energy-efficient appliances, most notably by establishing minimum energy performance requirements.
  
  The IEA (2021) report described that the energy demand for space cooling has increased at an average annual rate of 4% since 2000, twice as fast as that of lighting or water heating. Additionally, the number of units in use has more than doubled since the year 2000, reaching over 2.2 billion units in 2021. Therefore, the demand for energy-efficient condensing units is increasing.

Challenges

• Rising cost of energy-efficient condensing - As the demand for energy conservation grows globally, condensing systems' energy use has come under closer examination. Technological innovation is required to increase condensing unit efficiency without appreciably raising prices in order to achieve these goals. This is a problem as more efficiency necessitates the use of sophisticated parts and materials, which drive up costs and restrict market growth.
   
• Higher cost of raw materials - Due to a confluence of factors brought about by the COVID-19 epidemic, the cost of HVAC components and equipment is higher than typical during this season. The epidemic has decreased raw material availability and led to a manpower shortage in the industries that produce the necessary parts and equipment.