We are currently amidst what is arguably the most exciting time I have witnessed in the 30 years that I have been in the HVAC industry. The HVAC industry is a delicate one. Given the importance of indoor comfort (heating, cooling and ventilation) in Europe, this industry has been somewhat conservative and reluctant to take unnecessary risks. As a result, it has witnessed no major changes in competition, technology, and consumer behavior. This, however, is about to change.

Political bodies across the globe are introducing new policies to address the challenging issue of climate change. With the EU’s ambition to create a climate-neutral-economy by 2050, one of the most important implications of the Green Deal will be the switch from traditional gas boilers to more energy-efficient heat pumps¹. The transition will pave the way for immense opportunities for the air conditioning industry, taking our marketing potential to new limits. The bigger win however lies in this being an equally big opportunity for manufacturers to contribute to implementing the Green Deal and help mitigate the effects of global warming that are becoming more common by the day. This will be our most important contribution. It is our collective responsibility and duty to make it happen.

Introducing heat pumps

The transition from boilers to heat pumps will certainly have implications across different sectors as well as countries. Historical frontrunners in this space, such as France and the Scandinavian countries, will adapt faster to more widespread usage of heat pumps, however DACH countries, that are still heavily reliant on gas, will witness the biggest growth going forward. One thing is certain though: owing to the Green Deal, after all these years, there is a consensus within the industry that the heat pump is currently one of the winning technologies for the replacement of boilers. I am positive that we will collectively take the necessary steps to transition to cleaner and greener technology.

“There is a revolution going on now”

While there is much excitement about welcoming this radical change within the industry, we cannot ignore some of the challenges this would entail. Take for instance, the specific differences between the heating and air-conditioning industry in this regard. Within the heating industry itself, there is a clear distinction between gas boilers and heat pumps. Interestingly, at the core, heat pump and air conditioning run on the same technological principles – that of the compressor. This is the most delicate and demanding element, requiring both precise technology and adequate knowledge for operation.

It is interesting to note that air-conditioning technology is dominated by big Asian players, while the traditional boiler industry is led by local players within the European Union. The need of the hour, thus, is to find ways for the air conditioning industry to compliment the heating industry. We need to leverage the wide installation and service network of the thriving heating industry in the European Union with the pioneering air-conditioning technology and product know-how of Asian manufacturers; this will help accelerate the revolutionary change we are aiming for.

What will this mean for the world?

Everybody – from end-users to builders of houses – will be affected in one way or another, given the radical nature of this new technology.

End-users will witness how the process of heating changes in their house and adapt as new technologies help us wean off fossil fuels.  What I call third-party “specifiers” – builders – will have to look for structural redesigns to incorporate what will be the most crucial appliance in the house – the heat pump.

The biggest change, however, will be for the multitude of installers. Installers for both heating as well as for the air-conditioning industry will have to be re-educated. We will have to undertake the necessary costs to ensure the right competences – whether it is for designing a water system (for AC installers) or handling refrigerant-based outdoor units (for heating installers).

Certification too will play an important role. Firstly, installers need to get certified in order to handle refrigerants. Additionally, a heat pump requires an outdoor unit, and this is increasingly subject to regulations around noise and visual disturbance.

And finally, energy and electricity suppliers will witness unprecedented growth in demand as the sale of heat pumps continue to soar. Between increasing the stable supply of electricity and meeting demands, there might also be an endeavor to restrict use, and this what is called smart grids. At Samsung, we have already started doing this with our unique SmartThings technology, allowing appliances to help conserve energy by channeling it at the right time, based on usage patterns and requirement. Integration and digitalization, thus, will be key in adding cleaner, greener energy as a new element in our everyday life and ecosystem.

It is a huge challenge for the industry and we, meaning not just Samsung but also our partners, need to continue on the path we are on, in order to support the EU’s goal of reaching a climate-neutral-economy by 2050. I’m confident that we will get where we want to go, but a long road lies ahead of us.