In the latest of his series of interviews with key players on the road to net zero, Andrew Gaved talks to Haier’s Bob Cowlard.
During his 30-year career in air conditioning, Bob Cowlard has seen the fortunes of the HVAC sector rise and fall several times over. So, his views on how the industry should take advantage of an unprecedented time of change for heating and cooling, are clearly worth hearing.
As HVAC general manager for Chinese appliance giant Haier, Bob is pretty well-placed to play a part in the accelerating demand for heat pumps. The company, currently better known in the UK in the world of white goods – it is global market leader for ‘large household appliances’ and boasts four different brands in the UK, including Candy and Hoover alongside its own top of the range Haier range – will shortly make its presence felt with its own UK HVAC headquarters providing the front office for a heat pumps-to-AC operation.
The fact that the UK business, which is selling a range of domestic heat pumps from 5kW to 16kW and split AC systems from 2.5 to 25kW along with a full range of VRF systems, is being overseen by industry heavyweight Deane Flint, is a firm indication of Haier’s commitment to the market. With his extensive knowledge, experience and connections, Haier looks set to firmly make a lasting stamp in the UK.
UK ambition
In scouting for a suitable HQ building in which it can display its systems in a showroom type environment, Haier has happened upon a quirk of the current planning landscape. “We thought that the ideal location would be an ex-car showroom, since the buildings have large display space, a decent amount of car parking and usually workshops in the back too in which we would build training rooms, which is critical for the installers,” says Bob. “But many local councils won’t allow a change of use. They want companies like us to fill up their warehouse space and to keep the car showrooms for cars. So, we have a situation where there are a number of good properties available that we aren’t allowed in to. It’s frustrating when effectively we are trying to do the same thing as a car dealer: presenting the lifestyle and environmental benefits to the customer. However, in an era of flexible working, the team in the UK continues to grow, we are close to finding our forever home where we’ll host an immersive space in which installers can get close to the Haier range, so watch this space.”
Whole-house thinking
But not surprisingly for a manufacturer the size of Haier – the group is now over $38 billion and Europe alone is over $3.5billion, with 122 manufacturing centres worldwide – the UK ambition does not end at HVAC. The company is ready to take advantage of the increasing electrification of domestic infrastructure with its own solar PV, EV charging and battery storage product lines. The company plans to bring all this together for the homeowner (and ultimately the non-domestic building owner too) under its proprietary home energy management system, called hOn.
“These products are all made by Haier, designed and developed in Milan so it is controlled across the same platform – and don’t forget that can include the appliances too,” says Bob. Haier’s smart fridges and their features such as facial recognition have already become a talking point in the lifestyle media.
The idea of the hOn approach is that it will be able to be dovetailed with energy suppliers, to take advantage of the increasing number of ‘smart’ tariffs and ultimately to tap into the Grid Holy Grail of demand optimisation and grid flexibility – using the battery storage to manage demand peaks. “It’s a local alternative to suppliers having to turn the gas turbines on and off – anyone can now do it,” says Bob, “For instance, a hOn-connected air-to-water heat pump on a smart tariff can fill up their water tank when the electricity price is lower.”
He also underlines the advantage of having a complete system including solar PV and battery storage: “People need to remember that solar PV will still provide some power in the winter months, since it is dependent on light, not full sun.”
Diversifying the portfolio
Haier is also on the verge of another step-change – the company has been in talks for a number of months to buy a leading manufacturer of chillers, which will not only allow Haier to target more commercial applications, but will open the door to a large commercial heat pump range – an area where demand is currently high from commercial clients keen to reduce carbon and improve their ESG.
The HVAC operation has four factories currently, consisting of a room AC operation, a commercial AC facility, a water heater factory and what it calls New Energy, which produces solar PV panels and inverters, battery storage and the hOn system.
Bob notes that electric water heaters are an often-overlooked area in the low-carbon journey, and Haier also produces a heat pump water heater combination for applications where space heating isn’t required – such as sports and leisure clubs, where the plant can power the showers for example.
Air-to-water heat pumps
One of Haier’s next priorities is to further develop the technology of its air-to-water heat pumps. Working with a number of OEM partners the company wants to achieve a 6% share of the European market – some 250,000 units. The economies of scale that this will achieve means that Bob can make a headline-grabbing claim for the 5 kW baseline unit. “We want to take out a chunk of cost to build a heat pump that sells for comfortably under £1000. Whilst this is not available today, it has to be the medium term goal.”
Behind this ambition is to rework the componantry so that the pump and the controls are in the outdoor unit, repositioning this unit as a ‘heat source’. “All that comes out of a boiler is hot water, the pump and other components are outside.”
He notes another heat pump area where technology development is needed: “Where no-one has a good solution today across Europe is in the ‘balcony units’ for apartments. You see AC units on balconies across Europe, but you would struggle to find an air-to-water heat pump that you could put there, because they are currently too big and heavy. When the industry finds the solution for reducing weight – effectively reducing the compressor size and redesigning the coil to maximise its surface area – we will be able to replace the existing air to air units on the wall with a balcony heat pump, put a fan coil on the wall and a water tank in the cupboard, and then you can provide heating, cooling and hot water to the apartment.”
“And, on that note,” he adds, “It won’t be long now before the current ‘multi’ outdoor units will also be capable of feeding a water heater, as well as the indoor wall-mount, to give you hot water as well.
Bob believes that for the near-term at least, heat pumps containing propane as refrigerant will be a key technology: “Without a doubt, propane R290 for an external monobloc has the benefits of high temperature and low-Global Warming Potential (GWP). But it will continue to be restricted on anything that is not a sealed system. But once people realise that you don’t need high-temperature all the time and that a building can run at 35-40 deg C, then more units will be running on R454C [a refrigerant which has a GWP of 148]. Until the restrictions on buildings are removed, then we will not be able to move exclusively to natural refrigerants.”
The competitive battleground
As a relatively new entrant to the UK heat pump market [the brand has been introduced before, but not as part of a fully-fledged national operation], Bob is under no illusions that the quest for net zero will see a major battle amongst manufacturers to win hearts and minds.
“It is clear that the UK market will become the bloodiest playing field for manufacturers in the world. Only the most agile will survive. Just look at the numbers – there are 120,000 Gas Safe registered engineers and 9000 F-Gas registered engineers, so it is clear that the number people working on boilers far outweighs those working on heat pumps. How can you expect to persuade those engineers to convert away from a boiler brand towards another heat pump brand?. Will any manufacturers that currently share 1.6m boilers just give up half of their market share to new entrants without a fight?”
Training
One of the key points in the battlefield is to offer the training and support that the industry needs, he says:
“The industry could produce 150,000 heat pumps next year, but we don’t have enough installers in the market for that. So how do we solve it?…I believe it is the responsibility of the manufacturer to create the training support, but they need to incentivise the installers to want to put in a heat pump. And the older engineers particularly just don’t like change. So, do we, for instance, pay installers to come for training, instead of charging them? If you pay them £500 for passing the course after three days, they will still lose money, but at least it will make a contribution. But then how do you keep them with your brand?”
So perhaps, he says, it does need a government centrally funded training course across all heat pump types to provide the volume of installers needed: “But then the challenge is that while most boilers are similar fundamentally, there are at least four different types of heat pumps. So perhaps we should aim to make heat pumps more like a boiler, in some ways.”
To get the market moving more quickly towards heat pumps, Bob believes the answer a combination of the carrot and the stick:
“We have heard about the penalty that boiler manufacturers will have to pay if they don’t sell enough heat pumps. That is an element of the stick. But the current carrot, of the £5000 boiler upgrade scheme, is not terribly generous. The problem is that when the carrot from the government was generous, such as with the past incentives for solar PV, it proved too expensive and created an artificial market. So logically the stick needs applying more. The government has applied its stick to new build [in the Future Homes Standard which prohibits natural gas] but now it needs to do the same with regulation for the existing housing stock… At the moment, we have the lowest uptake for heat pumps in Europe – it is frankly embarrassing.”
