Heating device market in Poland in 2018

Heating device market
in Poland in 2018
SPIUG report
in Poland in 2018
Association of Heating
Device Manufacturers
and Importer
Warsaw, April 2019
Association of Heating
Device Manufacturers
and Importer
Warsaw, April 2019

Heating device market in Poland in 2018
Contents
1 Introduction............................................................................ 1
2 General market situation in 2018............................................ 3
2.1 General economic situation in Poland in 2018 and factors which influenced
the growth of the installation and heating market ................................................. 4
2.2 Residential construction............................................................................... 5
3 Market development in selected product groups in Poland in
2018.......................................................................................... 12
3.1 Suspended gas boilers .............................................................................. 15
3.1.1 Conventional suspended gas boilers ................................................................ 16
3.1.2 Suspended condensing gas boilers .................................................................. 18
3.2 Floor standing boilers (gas and oil) ............................................................ 19
3.2.1 Floor standing gas boilers ................................................................................. 20
3.2.2 Standing oil boilers ............................................................................................ 23
3.3 Solid fuel boilers ........................................................................................ 27
3.4 Heat pumps ............................................................................................... 30
3.5 Electrical heating ....................................................................................... 32
3.6 Solar collectors.......................................................................................... 35
3.7 Radiators and other installation components ............................................. 38
4 Summary of the forecast for the development of the heating
and plumbing market for the future............................................ 42

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1 Introduction
This report is the second annual trade report concerning the development of the heating
device market.
The Association of Heating Device Manufacturers and Importers is a trade organization
which gathers manufacturers of a broad range of heating devices, such as gas boilers, oil
boilers, solid fuel boilers, electric boilers, solar collectors or heat pumps, and since 2018,
also a group of manufacturers of heating system components, such as surface heating and
radiators. Moreover, SPIUG cooperates with manufacturers that develop innovative heat
sources, yet are not formal members of the organization. Members of SPIUG include such
brands as: ACV, Ariston, Baxi, Beretta, Buderus, DeDietrich, Defro, Ferroli, Fondital,
Galmet, Hewalex,Junkers, Bosch, Immergas, Kospel, Sanier Duval, Secespol, Sofath,
Stiebel Eltron, Termet, Thermagen, Unical, Vaillant, Viega, Viessmann, Weishaupt,Wolf, a
od 2018 roku także Purmo Rettig, Uponor, Herz, Comap, Tece and Aberon. The market of
individual heating devices in Poland is one of the larger ones in Europe, and, after dynamic
development in 2017 and 2018, still has a significant growth capacity. On account of the
existing infrastructure and great government support for system heat, a high percentage of
buildings in urban areas, particularly multi-family buildings, is connected to heating net-
works, or can be connected due to existing, nearby infrastructure and numerous offers of
support at the government and local level. All that influences the situation in the installation
and heating market in Poland, and its growth.
Due to the specificity of the market of individual heating devices, as well as the SPIUG area
of operations, this report contains information about the development of the lower-power
heating devices market, mostly under 50kW, but also takes into account slightly higher ca-
pacitates up to 200 kW heating devices, included in the statistics as part of the study. This
report is based on PIUG’s own analyses in the scope of the heating devices, and in the sec-
tion concerning the surroundings of the installation and heating market is based on analyzes
available at the GUS and information collected directly from the market, from fitters, manu-
facturers and distributors. Just like in the previous edition, lack of reliable estimates con-
cerning the market size and development of certain product groups which constitute heating

2
devices, such as e.g. oil radiators, prevents this report from presenting the market situation
in these groups, or allows to show a general analysis only.

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2 General market situation in 2018
The year 2018 saw continuation of the market and economic events from 2017, which had a
positive impact on the development of the installation and heating market in 2018. The eco-
nomic situation favourable for investments intended to improve the air quality at the local
level and the mood in the industry were a reflection of the sales increase, which started in
the industry in the 2
nd
quarter of 2017. Growth in consumption, as well as the ability to use
EU funds coming from the Regional Operational Programmes, certainly influenced the situa-
tion in the installation and heating industry in 2018.
The situation in the fitting-heating industry in 2018 was a continuation of the trend from
2017, when significant sales growth was recorded in most of the industry’s product groups.
Maybe these growths were not as drastic as a year earlier, but the positive trend in most
product groups prevailed. According to the opinions collected in the market, the result could
be even better if not for the noticeable employment problems – shore of specialists in work-
manship and significant increases in the prices of certain building materials. Moreover,
some of the companies active in the fitting and heating industry, with production plants in
Poland, started signaling the problem of workforce shortage, which restricts the possibility of
increasing production of devices and systems. In 2018, the market of replacing old heating
devices with new ones continues to consolidate. It is the result of local programmes intend-
ed to prevent low emissions – active since 2017 – so-called umbrella programmes based on
the Regional Operating Programmes performed mostly at the commune level, based on EU
funds which in the current perspective of about 75% of their usage being left to decide for
local governments. Also, the government priority programmer „Clean Air”, implemented in
September, intended to reduce low emissions, started incentivizing the investors to modern-
ize their heating systems. It is worth to note that as the NFOŚiGW introduced the “Clean
Air” programme, in certain local government units there were ideas to transfer the funds
from ROP, used to subsidize replacement of classing heating devices, to activities which
this programme does not encompass, or does so only marginally. Yet, as practice from the
end of 2018 and the first quarter of 2018 showed, local government should refrain from this
just yet, until the rules of the “Clean Air” programme are amended, for as the functioning of
this programme by the end of 2018 showed, they should be modified in several ways, to
make the most effective use of the funds allocated for the support in order to achieve the
final effect of reducing low emissions and improving the air quality in Poland. The media
upheaval concerning the need for reducing low emissions has also noticeably increased the
social awareness of the hazards it causes, which is of course a good thing, yet there is still
much to do in this respect.

4
2.1 General economic situation in Poland in 2018 and
factors which influenced the growth of the installation
and heating market
In January 2019, GUS published statistical data. According to the estimates presented by
GUS, 2018 saw a continuation of the bull market for good economic performance in the
country, according to the data provided by GUS, the dynamics of industry production in
2018 was 5.8% higher compared to 2017. In the case of the construction industry, 2018 saw
an increase of 17.9%, which was largely possible due to the results achieved by entities the
primary business of which is construction of buildings, which has an direct impact on the
potential result of companies from the fitting and heating industry.
According to the GUS data, prices of the construction and installation production in Decem-
ber 2018 were 3.7% higher compared to November 2018. According to GUS, the building
construction and construction work prices grew by 0.4%, also including fitting and heating
works – by 0.2%. Compared to December 2017, prices of the construction and installation
production increased by 3.7 %, including building prices by 3.9% and specialist construction
works, including fitting-heating, by 2.8%.
The results provided by GUS may cause doubts, seeing as a lot of construction materials
went up in price by several to more than ten per cent in the same period. The costs of em-
ployment grew as well, but one may assume this happened at the expense of the margins
acquired by construction companies. That would explain the growing issues with financial
liquidity in this industry. This situation is worth investigating. On one hand, we have an in-
flux of funds to the market. This caused a temporary halting of the wave of increase in insol-
vency of construction companies, although in this case one may also encounter many dif-
ferent opinions. Introduction of the reverse VAT is certainly a burden for subcontractors,
also those active in the fitting and heating industry, which are dependent on payments of
funds from the general contractors. Delays in this respect often reach several months. This
applies, e.g., to companies active in the fitting and heating industry, which are usually sub-
contractors for a specific group of specialist works. Meanwhile, in the preceding year this
number was already growing and was relatively high. Thus, it is hard to talk about and im-
provement – let alone a boom, which is also hardly visible in financial results – particularly in
the case of profits acquired by construction companies. Their profitability is decreasing
systematically. The actual financial situation in the construction company sector will only be
known after the final balance is available at the end of the year, after construction season.
This is when the current influx of funds into the industry will diminish or end, showing the
actual financial liquidity of the construction companies and their capability of settling out-
standing payments. Still, one can already see that investors have more and more problems
with finding contracting companies based on project estimates made in advance. It is in-

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creasingly common for companies to withdraw from tenders or pay contractual fines for
breaking off contracts, instead of getting bogged down in performing the contract below the
costs of performance. One can say that the situation is rather stable, albeit mostly for larger
entities. Among smaller companies, which also include fitting companies, liquidity problems
are commonplace. The situation should not undergo any major changes, at least until mid-
2019.
On one hand, the construction industry receives a lot orders, with the continued growth of
residential construction, although the growth dynamics in this sector dropped noticeably.
Yet, at the same time, there was a dynamic increase in the costs of labour and construction
materials. This situation increased the risk of losing financial liquidity by companies in the
construction industry. Another issue is the increase in problems with profitability of these
companies. Fortunately, so far there has been no drastic increase in insolvency in the con-
struction industry, although this problem exists more and more visibly. The situation is quite
stable, but this applies mostly to larger entities. Among smaller companies, which act as
subcontractor for those larger ones, including fitting companies, liquidity problems are quite
common.
2.2 Residential construction
The situation in the residential construction in 2018 had and will continue to have a great
impact on good performance in the installation and heating industry, and will continue to do
so in the near future, the results in the industry were affected by practically the same factors
as in 2017. One of them is certainly still a good result in residential construction, based on
growth in the number of commenced constructions, consistent since 2018, and number of
released building permits. Although the growth dynamics dropped mid-2018, the residential
construction performance data are still positive, which is also a good forecast for the fitting
and heating data, at least for the next 2 years. Let us remind you, that according to data
provided by GUS, in 2018 alone, 184.8 thousand apartments were commissioned, which

6
means a 3.6% growth compared to 2017.
Fig. 1 Number of apartments commissioned in 2014-2018 (Source: GUS)
The tendency in change of share in investments regarding the investors changed too, In
2018, the position of developers increased significantly, with their building 111,550 units,
which is 60.4% of all the apartments commissioned in 2018, meaning a 6.2% increase com-
pared to 2017, while individual investors built 66684 units, which means a 1.4% drop com-
pared to 2017, which gives them only 36.1% share in this statistical category, Other con-
struction forms (tenements, municipal and company), a total of 3.5 apartments were com-
missioned, i.e. 6.0% more than in 2017. These results have an impact on the structure of
installed heat sources.
143,166 147,711
163,325
178,342 184,783
0
20
40
60
80
100
120
140
160
180
200
2014 2015 2016 2017 2018
Total number of apartments
commissioned in 2014-2018 [thousands]

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Fig. 2 Tendencies in the number of apartments commissioned in 2014-2018, by groups of
investors (Source: GUS)
Developers who build mostly in urban areas make an extensive use of the possibilities of
connecting their buildings to the municipal heating network, of course if the infrastructure is
available locally, which seems understandable and logical from the perspective of the de-
veloper business. Nonetheless, there are doubts regarding forcing this type of connections
through, if the infrastructure is still only at the planning stage, for near or more distant future.
In the past, there were often problems with connection to heating network caused by time-
consuming procedures and investment completion time. In these cases, one could resort to
solutions based on dispersed heat sources, which unfortunately involved a struggle with the
bureaucratic procedure related to changing the heat source in the system design.
76129
79758
65706 67657 66684
59065 62420
91516
105027
111550
3490 2115 2707 2311 3002
4482 3418 3396 3347 3547
0
20000
40000
60000
80000
100000
120000
2014 2015 2016 2017 2018
Trends
Total number of apartments commissioned in 2014-2018 [pcs.]
budownictwo indywidualne deweloperzy budownictwo spółdzielcze pozostalideveloper cooperative housing othersindividual building

8
Fig. 3 Number of apartment constructions commenced in 2014-2018 (Source: GUS)
Between January and December 2018, construction of 221,904 apartments was com-
menced, which means a 7.7% increase compared to the preceding year.
Fig. 4 Trend in the number of apartment constructions commenced in 2014-2018, by inves-
tor groups (Source: GUS)
148,1
168,3 173,9
205,5
221,907
0
50
100
150
200
250
2014 2015 2016 2017 2018
Total number of commenced apartment constructions (as of
the end of the period )
in 2014-2018 [thousands]
74368
78855 83580
94483
85304
69723
86498
85497
105401
131627
1362 1285 2187 2746 2312
2669 1765 2668 3386 2664
0
20000
40000
60000
80000
100000
120000
140000
2014 2015 2016 2017 2018
Trends
Total number of commenced apartment constructions (as of the
end of the period )
in 2014-2018 [pcs.]
budownictwo indywidualne deweloperzy budownictwo spółdzielcze pozostaliindividual building developer cooperative housing others

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Taking into account investor groups, developers commenced construction of 131,627
apartments, constituting 59.3% of the total number of commenced apartment constructions,
while individual investors started building 85,304 apartments, that is 38.4% of the total num-
ber. Less apartments the construction of which started compared to 2017 were recorded in
cooperative construction, where building of 2,312 apartments was started compared to 2.7
thousand in 2017, meaning a 15.8% drop, and in other forms of construction (2,664 apart-
ments compared to 3.4 thousand in 2017, meaning a 20.7% decrease.
Fig. 5 Number of apartments for which permits were issued or applications were made in
2014 – 2018 (Source: GUS)
In 2018, permits were issued or applications with a design were submitted for construction
of 257,072 apartments, i.e. 2.7% more than in 2017.
156,8
188,8
211,6
250,9 257,072
0
50
100
150
200
250
300
2014 2015 2016 2017 2018
Total number of apartments for which permissions were
granted or applications were made in 2014-2018 [
thousands]

10
Fig 6 Trend in the number of apartments for which permits were issued or applications were
made in 2014 – 1
st
half of 2018, by investor groups (Source: GUS)
It is no surprise that the largest group of investors in this category consisted of developers,
who obtained building permits for 159.9 thousand apartments, and of individual investors,
who acquired permits for building 91.5 thousand apartments. In total, for these forms of
construction, permits were acquired or constructions were reported with a building design
for 97.8% of all the apartments (of which 62.2% for developers and 35.6% for individual
investors. Compared to 2017, there were 7% more apartments for which permits were
granted or applications were made with a building design in cooperative construction (1.7
thousand apartments compared with 1.6 thousand), with 24.5% less (3.9 thousand apart-
ments compared with 5.2 thousand) in other forms of construction.
The results and the tendencies related to the number of commissioned apartments, apart-
ments under construction and the number of issued construction permits and applications in
this scope allow us to analyze the growth potential of the installation and heating market in
the years to come, in the so-called first installation segment. It can be assumed that the
developers’ building cycle takes 18-24 months, whereas in the case of single-family con-
struction, it usually takes about 2-3 years, sometimes longer. This means that the invest-
ments started now will be fitted with heating devices at the final stages of construction, dur-
ing finishing works. Of course, pipes, connectors, etc. are fitted earlier, but the heating de-
vices themselves – only towards the end, when, for instance, the rooms must be heated
during final finishing of the interiors. Also, there is a certain delay between the moment of
receiving the building permit and finding the contractor, who actually commences the con-
76134
87736
98574
114905,0
91485
77489
97248
106643
128484
159923
1351
1409
1750
1619
1732
1995
2588
4601
521
3932
0
20000
40000
60000
80000
100000
120000
140000
160000
180000
2014 2015 2016 2017 2018
Trends
Total number of apartments for which permissions were granted
or applications were made in2014-2018 [pcs.]
budownictwo indywidualne deweloperzy budownictwo spółdzielcze pozostaliindividual building developer cooperative housing others

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struction works. This also gives a measurable potential of demand for heating devices in a
longer-term perspective. Hence, it is also worth examining the data concerning building
movement in various groups of investors, as their rate of performance also shits the demand
for heating devices into the future. In the case of commissioned buildings, they are complete
and constitute a basis for analyzing the actual and historic data.
Fig 7 Structure of apartments offered by developers by date of completing the investment in
the years 2014-2018 (Source: Spectis based on REAS)
A certain decrease in the growth dynamics in the residential construction may certainly im-
pact the future situation in the installation and heating industry, if the ruling party lacks con-
sistency in pursuing the programmes intended to reduce low emissions. The issue of dimin-
ishing share and drops in the individual construction group means a decreased potential for
installation of individual heating devices in new buildings in the case of expansion of net-
work hear, supported by the government and local administration bodies. So far, with the
increasing importance of supplementing the market potential by replacing heating devices,
the installation and heating industry has in no special way felt the trend of the diminishing
shares of individual construction in newly-built residential buildings.
13% 7% 6% 4% 4%
12%
12% 10% 10% 14%
39%
43%
42% 45%
44%
36% 38% 42% 41% 38%
0%
20%
40%
60%
80%
100%
120%
2014 2015 2016 2017 2018
Developer apartment offer structure by investment
completion date
ukończone rok lub dwa lata temu ukończone w roku bieżącym
do ukończenia w przyszłym roku do ukończenia za dwa lub trzy lata
completed one or two years ago
to be completed next year
completed in the current year
to be completed in two or three years

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3 Market development in selected product
groups in Poland in 2018
The results achieved in the installation and heating industry in 2018 are very positive and
characterized by a large growth tendency, compared to 2017. The entire 2018 was abun-
dant in orders, just like 2017. The fitters were very busy until the end of the year, and work-
force shortage was a noticeable problem. More and more often, the end users sought good
quality, affordable devices and were increasingly willing to pay a bit more for buying a better
device, which would ultimately be cheaper to operate, not just to purchase. The customers
were also more interested in the costs of servicing and spare parts, and their availability.
The customers’ increased awareness of the harmfulness of low emissions was, and still is, a
very important factor driving the market. The customers’ awareness translates into a grow-
ing interest in RES, including photovoltaics and recuperation, as well as possibilities of stor-
ing electricity and heat. In 2018, there were information of new PV cells, with batteries and
inverters made by Tesla. According to this information, in 2020 Tesla is planning to com-
mence sales of these system elements in Europe. In general, there is a visible market trend
towards clean energy, yet so far, in practice, this still applies more to well-off customers.
The Priority Programme Clean Air, implemented by the NFOŚiGW, is more and more rec-
ognizable, despite certain flaws, which are not surprising at the preliminary stages of the
programme. In the 4th quarter of 2018, NFOŚiGW received a number of applications for
boiler room modernization, which will be carried out in 2019. The Priority Programme Clean
Air, which realistically took off at the turn of the 3
rd
and 4
th
quarter of 2019, increases the
customers’ awareness of modernization. Currently, the shape and effectiveness of this pro-
gramme are being discussed, as the actual results achieved by the end of 2018 were not
particularly impressive. The proposed changes are not a criticism of the programme itself.
The initial stages of every programme are in practice a trial period, where the results can be
used to improve this programme, which is a normal occurrence,
Support programmes for reduction of low emissions are currently diversified. Right now, the
customers apply for the subsidy themselves, receive the grant and decide where to install.
Towards the end of 2018, the thermal upgrading concession started playing a larger role,
despite numerous ambiguities, e.g. concerning deduction of PIT costs.
The results achieved in 2018 in the installation and heating industry were a continuation of
the trends which appeared throughout 2017. Although the increases were still two-digit in
numerous product groups, they were no longer as spectacular as a year before, which is not
alarming, but can be seen positively, as a certain safe market stabilization. The final results
were still aided despite weaker growth dynamics in residential construction, both multi- and
single- family, by campaigns of replacing old devices with new ones, supposedly zero-
emission or with greatly reduced emission of waste into the atmosphere. Also, the relatively

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stable economic situation and high level of consumption favored the positive situation in the
installation and heating industry. The growing trend in the installation and heating market is
related to further increase in complete and almost complete investment, both in multi-family
and individual construction, though the share of the latter is noticeably lower, and still in-
creasingly dominant since 2017 market of replacing old devices with new ones. A greater
number of commissioned apartments means a higher demand for heating system compo-
nents, including heat sources. In the case of multi-family buildings, located in urbanized
areas, network heat satisfies a lot of the demand, which seems a simpler solution for the
developers, who are hardly interested in the costs of future use and bills for network heat,
which will certainly grow in time. But the heating infrastructure is not always available at the
sites of new residential estates, nor could it be realistically provided in the years to come.
The problems in this scope involve mostly time required for formalities and the resulting
investment implementation period. Nevertheless, there is an increasingly visible support for
solutions which prefer usage of network heat as the basic heat source by the government
administration and local authorities, which are often, in one way or another, affiliated with
the heating network operators. Another phenomenon which positively impacts the develop-
ment of the installation and heating market in 2018 were the actions of local governments,
intended to reduce low emissions. In many regions of Poland, numerous support pro-
grammes emerged, based on the EU funds. Primarily Regional Operational Programmes,
intended to restrict the low emissions by replacing old boilers with new ones. These activi-
ties are highly dispersed. Thanks to this support, whenever possible, investors replace old
boilers with new ones, often more economical and energy efficient condensing gas boilers,
which apart from much lower gas consumption, also provide practicably negligible amount
of substances released into the atmosphere during combustion. Where, for technical rea-
sons, this is not possible, old devices are replaced with conventional boilers of the latest
generation, with better parameters than those installed 20 years ago, which has a positive
impact on reducing the harmful emissions into the atmosphere. Activities of this sort are
taken mostly in old buildings, inhabited by senior citizens, whose income prevent them from
a more extensive modernization of the home heating systems. Also, according to some of
the information coming from the market, some of the former users of solid-fuel boilers, hav-
ing an option to connect to a gas network, taking into account the increase in the price of
class-five boilers, decide to replace them with gas boilers, the price of which is constant
(fixed price of EUR and relatively stable EUR f/x rate), unlike the growing production costs
of solid-fuel boilers made in Poland, caused by the fact that they must meet stringent emis-
sion parameters and increasing material costs. But this does not mean departing from solid-
fuel boilers as the current national gas network coverage is not exactly a threat for this heat-
ing technology. Whereas there is a noticeable trend to abandon coal as fuel, as a result of
replacing solid-fuel heating devices with biomass, mostly pellet.

14
The general growth trend in the installation and heating market appears to be stable
throughout 2018, with a still strong growth tendency in the sales of devices compared to
2017, although near the end of the year, in certain regions of Poland, there was a slightly
noticeable drop in dynamics, probably related to the announcement of the “Clean Air” pro-
gramme and withholding the decisions to purchase until the rules of the programme are
known and communal meetings are held. This is particularly visible in the segment of gas
boilers and heat pumps. Whereas the beginning of 2019 saw a veritable suppression of
solid-fuel boiler sales, caused by waiting for the rules of selling solid-fuel boilers as part of
the Priority Programme “Clean Air”. In 2018, sales of these devices were stimulated by
numerous local support programmes, but they were less motivated by the “Clean air” pro-
gramme, implemented in the last month of the third quarter of 2018.
In 2018, there was a further increase in the sales of condensing gas boilers, caused by the
users’ preparing for the heating season near the end of the ear. The second half of the year
was the traditional period of replacing old devices with new ones. In the case of convention-
al boilers, the sales rose by several per cent compared to the preceding year, but it can be
assumed that the device replacement market has stabilized, as they are no longer installed
in new buildings. The largest „brake” for further market growth is the shortage of specialists.
Currently, the fitters have their schedules full until the end of the year and in the beginning
of 2019. All the investors who failed to make arrangements in advance must now be patient.
One may believe that with higher supply of subcontractors, the sales results could be even
better. The issue of workforce shortage is still present and also applies to the manufactur-
ers of heating devices and heating system components in Poland. Lately, due to workforce
shortage, manufacturers with production plants in Poland may have lost about 10%-15%
sales volume, as they could not expand production to meet the increased demand. Unfortu-
nately, one can also observe increasing payment stoppages in the major investment seg-
ment. They also affect subcontractors from the installation and heating segment. This con-
cerns mostly specialists that install heat pumps, but also other heating devices. There
seems to be too few fitters, which becomes noticeable with the growing market trend. Manu-
facturers must train new fitters, but their numbers grow slower than the market. Anti-smog
campaigns, which include, e.g., replacement of old devices with new ones, have significant-
ly increased the share of the device replacement market in the entire sales structure, which,
according to estimates, reached about 65-70 % of the entire sales volume in 2018, which
had a significant impact on the heating device sales results in 2018. Thanks to initiated in-
formation campaigns intended to restrict low emission, there is also an increased interest in
modern heating technologies, including OZE – both heat pumps and solar collectors, alt-
hough the latter are more visible in district tenders, organized as a result of good practices
with such installations in the same commune or “at the neighbor’s”, particularly in the East-
ern Poland.
Despite a large increase in the installation-heating market, there is still a noticeable de-
crease in the wholesale margin, particularly for the so-called sensitive goods, highly popular

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among the customers. Traditionally, the basic transaction factor was the price, which is ra-
ther identical to the situation in other EU countries. There is also a noticeable increase in the
importance of the Internet as a tool for finding technical and commercial information in the
installation and heating industry. A SPIUG report published in November 2018, concerning
online sales of heating devices, shows that despite the increases, it is still a media-oriented
action, with less than 10 % share in sales. Nonetheless, sale of devices without installation
is becoming impossible because of the Internet, which shows low prices due to differences
in VAT settlement. In 2018, there was also a noticeable increase in the goods delivery
period – with such significant growth in demand for the goods, the suppliers are unable to
forecast purchases and expand production, due to workforce shortages and delays in raw
material deliveries. In general, one can say that in 2018, the installation and heating market
retained the growth tendency. This arises from a good economic situation – growing em-
ployment and wages, paired with support instruments from anti-smog campaigns, in the
form of subsidies for boiler room modernization. Apart from higher quantitative demand for
products, the increased sales value results from higher prices of these products. A certain
noticeable, negative phenomenon is the fact that the customers pay little attention to the
labelling of the products and lack of enforcement of the regulations, making it mandatory to
attach product sheets during purchase, which prevents the customers from perceiving the
differences between boilers and technologies, which is also common in other EU countries,
but this is hardly a consolation. In 2018, according to highly preliminary estimates, the total
market growth came to 10%-15%.
3.1 Suspended gas boilers
Since 2016, the market of suspended gas boilers has been practically dominated by con-
densing boilers. This is the result of implementing – in September 2015 – the requirements
of the ecoproject and the associated EU orders to the ErP directive, which are supposed to
prohibit or severely restrict the possibility of marketing any boilers other than condensing.
2018 saw a continuation of the dynamic sales growth for suspended gas boilers in Poland,
caused by the aforesaid reasons. In the entire group of suspended boilers, the growth scale
was about 25% for the entire year, compared to 2017.

16
Fig. 8 Sales of suspended gas boilers in 2014 – 2018 (Source: SPIUG study)
Fig. 9 Sales of suspended gas boilers in 2014 – 2018 - trend (Source: SPIUG study)
3.1.1 Conventional suspended gas boilers
After large drops in the last two years, the sales of these devices have stabilized, with a
slight growth tendency, resulting from the dynamically-growing replacement market. The
perspective of implementing new regulations required by the EU directives caused previous
high stock levels at the distributors from manufacturers, yet in the 4
th
quarter of 2018, there
was a drop-in sales of these devices by about 20% compared to a small, one per cent de-
175000
164000 169500 165500
184300
172000
225000
282000
0
50000
100000
150000
200000
250000
300000
2011 2012 2013 2014 2015 2016 2017 2018
Suspended gas boilers in total
0
50000
100000
150000
200000
250000
300000
2011 2012 2013 2014 2015 2016 2017 2018
Suspended gas boilers in total

u
crease in the entire 2018. The situation was similar in the group of gas floor standing boil-
ers, where a 20% increase was also recorded, but with reference to the base value, sale of
even several dozen pieces causes a significant increase counted in per cent. Where for
technical reasons condensing boilers cannot be simply installed, new conventional boilers
are installed, with better parameters, which are currently closed to the requirements of the
ecodesign. Usually, inquiries in this scope come from seniors, who live in old buildings and
cannot afford the expensive modifications of the home central heating systems. But the
market segment of conventional gas boilers should be rather considered niche. Its share in
the group of suspended boilers due to the replacement marker has stabilized at 10-12 per
cent.
Fig. 2 Sales of conventional suspended gas boilers in 2014 – first half of 2018 (Source:
SPIUG study)
108600
97600 100500
93200
107100
34400 35000 34700
0
20000
40000
60000
80000
100000
120000
2011 2012 2013 2014 2015 2016 2017 2018
Conventional suspended gas boilers

18
Fig. 3 Sales of conventional suspended gas boilers in 2014 – first half of 2018 – trend
(Source: SPIUG study)
3.1.2 Suspended condensing gas boilers
Both the end of 2019 and the entire 2018 were a period of dynamic growth in the sales of
condensing boilers. There is still a trend for dynamic sales increase in this group of devices.
Also, among condensing boilers, there is a noticeable trend to find the cheapest boiler. The
market of suspended gas boilers has been virtually dominated by these devices. Sales in-
creases in the group of condensing suspended boilers in the entire 2018 of about 30%.
There is still a pricing fight in the scope of condensing gas boilers, resulting from the so-
called „Quasicondensates” operating in the market. The pricing struggle caused a drop in
the purchase prices of condensing boilers. The meaning of the quasi-condensing boilers is
rather overrated as far as the development of the condensing gas boiler market in Poland is
concerned. Their sales remained at a level similar to 2017, but in view of the growth of the
entire market of suspended condensing gas boilers, their share in the whole decreased to
about 5%. There was a very dynamic increase in the sales of single-function condensing
boilers sold in packages with reservoirs.
0
20000
40000
60000
80000
100000
120000
2011 2012 2013 2014 2015 2016 2017 2018
Conventional suspended gas boilers

u
Fig. 4 Sales of suspended condensing gas boilers in 2014 – 2018 (Source: SPIUG study)
Fig. 5 Sales of suspended condensing gas boilers in 2014 – 2018 – trend (Source: SPIUG
study)
3.2 Floor standing boilers (gas and oil)
The floor standing boiler product group includes a broad array of goods, differing in both fuel
type and construction. Floor standing boilers can be fuelled with gas, fuel oil, solid fuels,
including both coal and coal-derivatives, as well as with biomass of various types. Due to
their nature, floor standing boilers can be classified as traditional devices, the installation of
66400 66400 69000 72300 77200
137600
190000
246800
0
50000
100000
150000
200000
250000
300000
2011 2012 2013 2014 2015 2016 2017 2018
Suspended conventional gas boilers
0
50000
100000
150000
200000
250000
300000
2011 2012 2013 2014 2015 2016 2017 2018
Suspended conventional gas boilers

20
which requires a relatively large space, which is why over the years the market potential for
these devices has been in decline, particularly in the scope of gas and oil boilers. Market
potential drops in the group of solid fuel boilers were rather connected with switching to
other heating devices, of no-emission or with limited low emission, and connections to mu-
nicipal central heating systems.
3.2.1 Floor standing gas boilers
In the group of floor standing gas boilers, just like in other boiler groups, quite significant
increases were recorded too, coming to about 20% in the entire 2018. Condensing boilers
are absolutely dominant in the group of floor standing boilers too. Nonetheless, the annual
increase in term of sales dynamics was 19% for the floor standing condensing gas boilers,
and 20% for the conventional boilers. It should be remembered that with relatively low quan-
titative potential, sales or lack of sales of even small number of the devices is reflected in
quite a significant percentage shift of the sales volume. It is also worth to note a minor drop
of 6% in the number of floor standing boilers without a burner, sold in 2018. To supplement
the sales data for floor standing gas boilers, it is worth to note a 14% sales increase for boil-
ers with integrated reservoir, referred to as “fridges”, because of their appearance.
Fig. 6 Sales of floor standing gas boilers in 2014 – 2018 (Source: SPIUG study)
9000
6900
6500
6000 6100
7000
8200
9800
0
2000
4000
6000
8000
10000
12000
2011 2012 2013 2014 2015 2016 2017 2018
Floor standing gas boilers in total

u
Fig. 7 Sales of floor standing gas boilers in 2014 – first half of 2018 – trend (Source: SPIUG
study)
Fig. 8 Sales of floor standing condensing gas boilers in 2014 – 2018 (Source: SPIUG study)
0
2000
4000
6000
8000
10000
12000
2011 2012 2013 2014 2015 2016 2017 2018
Floor standing gas boilers in total
6200
5100
4600 4400
4900
6600
7700
9200
0
1000
2000
3000
4000
5000
6000
7000
8000
9000
10000
2011 2012 2013 2014 2015 2016 2017 2018
Floor standing condensing gas boilers

22
Fig. 9 Sales of floor standing condensing gas boilers in 2014 – first half of 2018 – trend
Fig. 10 Sales of conventional floor standing gas boilers in 2014 – -2018 (Source: SPIUG
study)
0
1000
2000
3000
4000
5000
6000
7000
8000
9000
10000
2011 2012 2013 2014 2015 2016 2017 2018
Floor standing condensing gas boilers
2800
1800
1900
1600
1200
400
500
600
0
500
1000
1500
2000
2500
3000
2011 2012 2013 2014 2015 2016 2017 2018
Floor standing conventional gas boilers

u
Fig. 11 Sales of conventional floor standing gas boilers in 2014 – 2018 – trend (Source:
SPIUG study)
3.2.2 Standing oil boilers
Oil boilers are not as popular in Poland as in Western Europe. This is due to a different
structure of fuels used for heating. In Poland, heating oil was traditionally perceived as an
expensive heating fuel, which led to a significant drop in market potential a few years ago.
Since 2016, there has been a certain renaissance of the equipment, caused, among other
things, by an increase in the availability of heating oil as a fuel due to a more acceptable
price and ease of use. In 2017, a certain increase in sales of oil boilers was noted, which
amounted to approx. 11-12%, while in the condensing equipment group this increase
amounted to approx. 20% in the whole 2017. In 2018, in the group of oil boilers, at the end
of 2018, sales dropped by approx. 25%, and in the whole 2018, this drop was approx. 14%
for the whole group. One of the reasons for lower interest in oil boilers, apart from fuel costs,
is the issue of the quality of these fuels. Due to the degree of sulphurisation of the fuel
available in Poland, some manufacturers do not want to give guarantees for these devices,
especially for those with higher capacities.
As in the case of standing gas boilers, there is currently no significant market potential for
the sale of such equipment. In the group of oil boilers, after a slight increase in sales in the
first quarter of 2018 by several percent, in the first half of 2018 there was a decrease by
approx. 10 percent and the closer to the end of the year. The falls were even greater, reach-
ing 25% in the fourth quarter of 2018.
0
500
1000
1500
2000
2500
3000
2011 2012 2013 2014 2015 2016 2017 2018
Floor standing conventional gas boilers

24
Fig. 12 Sales of standing oil boilers in the period 2014-2018 (Source: SPIUG study)
Fig. 13 Sales of standing oil boilers in the period 2014-2018 - trend (Source: SPIUG study)
Following the chart showing trends in oil boiler sales, it can be assumed that after a dra-
matic drop in sales in 2011 - 2013, the market stabilised. Even the double-digit drop that
took place in 2018 is the result of a certain instability in demand, where the difference in
sales between a few dozen and a few hundred devices is already clearly visible in the per-
centage result of changes in the sales dynamics.
4200
2200
1500 1500 1500
1700 1800
1550
0
500
1000
1500
2000
2500
3000
3500
4000
4500
2011 2012 2013 2014 2015 2016 2017 2018
Oil standing boilers in general
0
500
1000
1500
2000
2500
3000
3500
4000
4500
2011 2012 2013 2014 2015 2016 2017 2018
Oil standing boilers in general

u
Fig. 14 Sales of standing oil condensing boilers in the period 2014-2018 (Source: SPIUG
study)
In the group of oil condensing boilers, the drop-in sales in 2018 was minimal and amounted
to approx. 1%. Following the trend of changes in the market potential for condensing oil
boilers, it is easy to notice that the implementation of ecodesign requirements in 2015 re-
sulted in increased interest in the purchase of condensing boilers for heating oil. Neverthe-
less, in 2017 the situation stabilised, while in other product groups there were very large
sales growths. This means that some of the appliances being replaced have been replaced
by other heating technologies.
460
280
250
200
350
630
790 780
0
100
200
300
400
500
600
700
800
900
2011 2012 2013 2014 2015 2016 2017 2018
Condensing standing oil boilers

26
Fig. 15 Sales of standing oil condensing boilers in the period 2014-2018 - trend (Source:
SPIUG study)
In the case of conventional oil boilers, the decreases were greater than in the case of con-
densing boilers, which seems natural in the case of ecodesign regulations. Nevertheless,
the oil-fired boilers market in Poland is still divided practically in half between condensing
boilers and conventional boilers, but with a downward trend in shares in the group of con-
ventional boilers.
Fig 16 Sales of standing conventional oil boilers in the period 2014-2018 (Source: SPIUG
study)
0
100
200
300
400
500
600
700
800
900
2011 2012 2013 2014 2015 2016 2017 2018
Condensing standing oil boilers
3740
1920
1250 1300
1150 1070 1010
770
0
500
1000
1500
2000
2500
3000
3500
4000
2011 2012 2013 2014 2015 2016 2017 2018
Conventional floor-standing oil boilers

u
Fig. 17 Sales of standing conventional oil boilers in the period 2014-2018 - trend (Source:
SPIUG study)
3.3 Solid fuel boilers
The product group of solid fuel boilers is very fragmented and difficult to classify due to the
type of fuel and capacity of equipment offered on the market. The group of boilers for solid
fuels includes equipment with the power of several kilowatts as well as with the power of
several hundred kilowatts even up to over 1 MW. Due to the relatively large number of man-
ufacturers, both professional ones, manufacturing equipment in modern plants employing
several hundred people each, and those manufacturing boilers in handicraft conditions, it is
difficult to create reliable statistics, therefore at this stage we can only rely on market esti-
mates collected directly from producers and distributors of solid fuel boilers in Poland. A
large part of these devices is produced in Poland. The share of imported solid fuel boilers in
Poland is insignificant and concerns mainly specialist biomass boilers. At present, SPIUG
has made efforts to create a fully reliable monitoring of the equipment market in Poland in
the near future, following the example of other groups of heating equipment, also for solid
fuel boilers. If such a project is successful, the estimates on which this report is based will
be verified.
According to the collected opinions, in 2018 there was a further decrease in sales of solid
fuel boilers in Poland. At least that's the opinion of the official distribution channels. Some
companies in the market certainly finance their activities in the grey market, where they
continue to trade in boilers that do not have the required permits, or have documents that
are later rejected in the event of any inspection. The extent of the so-called grey market is
not known, but it can be assumed optimistically that it is not a mass phenomenon, although
0
500
1000
1500
2000
2500
3000
3500
4000
2011 2012 2013 2014 2015 2016 2017 2018
Conventional floor-standing oil boilers

28
it is visible on the market. The decrease in sales of solid fuel boilers is mainly due to emis-
sion reduction measures. In urban areas where district heating network infrastructure exists
or is being built, buildings heated by solid fuel boilers of the old generation, emitting a large
amount of all pollutants into the atmosphere, are connected to district heating networks or,
where gas networks are available, are replaced by gas condensing boilers. This is one of
the reasons why the potential of the market for solid fuel boilers is decreasing. In rural are-
as, the market for solid fuel boilers has traditionally been based on the market for replace-
ment of equipment. In 2018, the replacement of old boilers with new ones, intended to meet
the current restrictive emission standards, was supported under support programmes, as
was the case with gas boilers. Traditionally, the end of the year is characterised by a slow-
down in the sale of solid fuel boilers. Compared to the previous quarter of 2018, the declines
were slightly above 10%. Due to artificially high sales due to the entry into force of the boiler
quality regulation in October 2017, this period is not a reliable benchmark for setting sales
trends in this group of heating appliances. In order to have a more reliable benchmark, it is
necessary to go back two years. In comparison to the analogous period of 2016, declines of
15% were noted. Another reason for slowing down this market is the NFOŚiGW "Clean Air"
programme, or rather uncertainty as to the scope of support and its rules under this pro-
gramme for solid fuel boilers. The impact of this reason on the sale of solid fuel boilers has
been even more visible since the beginning of 2019, when sales slowed down further, in
some cases at a very drastic level. The reason for this is simple - potential investors and
consumers are holding back their purchase decisions while awaiting the start of payments
under the Clean Air Programme and the announcement of new modified rules, which is
unlikely to happen before June 2019.
2018 was a year of waiting for the industry to seal the Boiler Quality Regulation, as the larg-
est producers were losing market to those who manufactured boilers outside the legal cycle
and who were exploiting existing loopholes. The amended regulation finally came into force
only in March 2019 and, according to legal distribution channels, resulted in a decrease in
sales of backfilling boilers by as much as 70-80%, but there was no lack of opinion on the
total stagnation in this group of equipment.
In the segment of boilers for solid fuels, in 2018 demand for coal-fired boilers remained at a
similar level, but with a visible downward trend in the share in sales, while a significant in-
crease in interest in pellet boilers is noticeable. It is estimated that in 2018 sales of these
boilers were nearly 65% higher than in the previous year and about six times higher than in
2016, which is certainly due to the transition of a number of manufacturers to technologies
meeting future ecodesign requirements and current quality requirements contained in the
regulation of the Ministry of Technology and Entrepreneurship for boilers emissions from
solid fuels. According to the estimates collected, in 2016 Pellet boilers had a 6% share in
the group of boilers with automatic backfilling, now after 2018 this share reaches 35%

u
In 2018, the group of boilers for solid fuels underwent significant changes due to the entry
into force, as of 1 October 2017, of a regulation increasing the requirements for emission
reduction for this type of equipment. According to the regulation, theoretically from 1 July
2018 it was not allowed to place on the market and install boilers for solid fuels not meeting
at least the 5th class standard according to the PN-EN 303-5 standard. Some producers
have adapted to the existing legal regulations, losing the market to producers introducing
boilers under new names. This was made possible by the gap in the regulation in force at
the time. It was amended and sealed and came into force in this form at the beginning of
2019. This regulation is very much needed and is a step in the right direction. It has already
had an impact on the development of the market for fuel-fired boilers. As a result of the anti-
smog programmes, there was an increased interest in boilers for solid fuel of the fifth class,
however, looking at the overall production, the retail market decreased significantly. This
was probably done with the participation of grant programs run by local government units.
Turnover remains unchanged, but assuming that more technically advanced devices are
sold, this means a decrease in the number of devices sold. It is likely that the inability to
purchase cheap equipment and the increase in prices of fifth class boilers may have result-
ed in a partial flow of customers towards gas boilers.
In the case of boilers with manual backfilling, the level of sales decreased significantly, at
least in official sales. This market assessment seems to be significantly underestimated due
to the sale of non-class boilers in 2018, i.e. officially for hot water or non-wood biomass,
which is not covered by any statistics or market monitoring. In the case of officially sold
equipment, such a low level of sales of backfill boilers meeting the requirements of the regu-
lation is probably influenced by the need to install an accumulation tank, which significantly
increases the level of investment. Therefore, it seems necessary to seal the system and
eliminate out-of-class boilers sold both in distribution networks and at trade fairs sold "out of
the car". As expected, there is an increased level of sales of boilers with automatic feeding.

30
Fig. 18 Sales of boilers for solid fuels in the period 2014-2018 (Source: SPIUG study)
Fig. 19 Sales of boilers for solid fuels in the period 2014-2018 - trend (Source: SPIUG study)
3.4 Heat pumps
In 2018, heat pumps recorded a significant increase in sales, which reached the level of
31% in the entire product group. As in the case of boilers, the growth rate varied depending
on the type of heat pump. These include mainly air heat pumps of various varieties. The
largest increases were recorded in air-to-water pumps, where annual increases were gen-
erally 31%. Also, within this group of heat pumps, a large variation in market development
200000
190000
180000 180000
170000
160000 160000
145000
0
50000
100000
150000
200000
250000
2011 2012 2013 2014 2015 2016 2017 2018
Solid fuel boilers
0
50000
100000
150000
200000
250000
2011 2012 2013 2014 2015 2016 2017 2018
Solid fuel boilers

u
could be observed. The highest increases were observed in the group of monoblock heating
pumps, where, for example, in the case of pumps with lower power, one can even speak of
double increases, where, on the other hand, in the case of split pumps, sales dropped from
a few to even approx. 50% depending on the type and variety. There was also a certain 6%
increase in the group of air-to-water pumps intended for the preparation of domestic hot
water. Such a low level of growth may be surprising when confronted with the signals com-
ing practically from 2017 and throughout 2018 from the market with high interest in this type
of equipment. Ground pumps in the year 2018 also recorded an increase of 5% in the case
of brine/water-pumps However, the water-to-water pumps have fallen by 22%. Overall,
preliminary estimates suggest that the overall increase in sales of heat pumps in 2018 was
around 31%, which was already mentioned at the beginning. Air-to-water pumps for the
preparation of domestic hot water, which account for approximately 25% of the volume of all
pumps sold in 2018 in Poland, are the dominant heat pumps. A significant share in the sales
structure of heat pumps in Poland is also held by reversing pumps of various capacities and
varieties. The segment of air pumps is growing but in this case the limit is cooling rights,
which appeared in 2018. In this segment of the heat pump market, companies dealing with
air conditioning on a daily basis try to enter, but this type of activity requires broadening
knowledge in the field of hydraulics. Some support for the heat pump market may be pro-
vided by the priority programme "Clean Air" of the National Fund for Environmental Protec-
tion and Water Management, which begins to make the investor aware of the possibility of
obtaining co-financing and reducing emissions, which starts to have a direct impact on the
interest in heat pumps as an emission-free heat source. Another interesting idea that can
contribute to a wider use of heat pumps is the idea of houses without bills, i.e. the installa-
tion of a hybrid heat pump in combination with a prosumer photovoltaic installation. Heat
pump installers are already busy at the beginning of 2019 and do not accept any new or-
ders. There are few such installers and the market is growing. New heat pump installers
need to be trained, but are increasing more slowly than market growth.

32
Fig. 20 Sales of heat pumps in general in the period 2014-2018 (Source: SPIUG study)
Fig. 21 Sales of heat pumps in general in the period 2014-2018 - trend (Source: SPIUG
study)
3.5 Electrical heating
Despite high operating costs, electric heating has a stable position on the market of each of
the EU countries. Also, in Poland, despite the traditional view that electric heating is very
expensive, this type of heating has been developing consistently for several years. The use
of electricity from renewable energy sources is certainly forward-looking, both directly for
9700
12000
15000
16500
18000
19500
24000
31500
0
5000
10000
15000
20000
25000
30000
35000
2011 2012 2013 2014 2015 2016 2017 2018
Heat pumps (without air conditioners)
0
5000
10000
15000
20000
25000
30000
35000
2011 2012 2013 2014 2015 2016 2017 2018
Heat pumps (without air conditioners)

u
heating and in RES hybrid installations, where electricity is used to power devices whose
primary heat source is gas or heat from the sun or the environment. The use of electricity for
heating could to some extent solve the problem of excess electricity produced by wind farms
in autumn and winter. The current growing interest in electricity as a source of heat has
several factors such as: increasing (better) statutory requirements for insulation of build-
ings, growing awareness of investors, dissemination of photovoltaics (with more budget
support the market could grow much more), growing purchasing and economic power of the
society, in the form of a slowly developing middle class, thus, the search for a convenient
form of heating, e.g. in the case of weekend or holiday homes. We can also observe
tendencies which depend on increasingly common bivalent heating, i.e. with two sources of
heat in this one, i.e. an electric boiler. On the market of electric heating devices, we can also
observe a growing diversification of heat sources, which allows for an increasing possibility
of choice by the customer. In terms of value for electric heating appliances for heating pur-
poses, heat pumps are certainly the leading suppliers, followed by electric convection heat-
ers, oil heaters and electric and water-electric bathroom radiators. The next step is to re-
place underfloor and surface electric heating (heating cables and increasingly popular heat-
ing films), followed by electric central heating boilers. and lastly, accumulation ovens and
similar decorative heaters, usually made of stone. According to the information gathered,
quite a lot of small blowing heaters are sold, but we did not have access or there are no
reliable data on this type of heating, but these solutions cannot be treated as elements of
the heating system of a building.
The market of electric heating is growing year by year thanks to the development of alterna-
tive sources of power, which significantly reduces current operating costs, which were a
traditional barrier for this type of heating. Electric heating has a completely new meaning for
households, it becomes more accessible and easier to install in buildings. The market is
open to different products, there are different solutions for electric heating. Such modern
solutions include resistance, induction and electrode boilers, which cover up to 5% of the
electric boiler market, or electromagnetic heating with heat recovery. Electric heating is
usually combined with heat accumulation, which is why it is so important to install accumula-
tion tanks in each system, which give the possibility to store heat and give away it depend-
ing on the need for heat and time. But there are also dual-function flow-through boilers.
In 2018, the market grew more than previously estimated and amounted to approximately
25%. The clear upward trend visible for several years now is influenced by several factors:
development of photovoltaic installations, anti-smog subsidies in communes, more energy-
efficient houses with low energy demand for heating, the possibility of using energy in cheap
tariffs thanks to the combination with the buffer of heat accumulation, increase in wealth and
search for comfort. However, there was a strong signal inhibiting the sale of electrical
equipment - a rise in electricity prices. As we know, the increases were blocked until the
elections, but what will happen later is that it is difficult to count on constant subsidies - state

34
subsidies for the costs of production and transmission of energy. Therefore, the lower
growth rate in 2019 can be estimated with caution. A certain solution that would have a posi-
tive impact on the development of electric heating would be the development of the idea of
houses without bills based on a hybrid electric heating device and a prosumer installation for
the production of electricity based on RES, i.e. photovoltaics and small wind turbines.
As far as forecasts are concerned, one can be a moderate optimist. Opportunities are the
spread of photovoltaics, possibly in the future greater environmental awareness of politi-
cians and better support for subsidies, more and more passive and low-energy-efficient
homes, and the growing wealth of the middle class. A threat to electric heating is the disput-
able in its wording EU regulations on the energy class (electric heating boilers are classified
in class D because of the overall low efficiency of the power system). The classification sys-
tem of energy classes does not provide for a situation where electric boilers are forced by
local sources of electric energy based on RES, i.e. completely clean Energy without trans-
mission losses. Perhaps something will change with the next review of the assumptions and
functioning of the ecodesign for room heaters.
Fig. 22 Electric boilers - estimates for the years 2011-2018 (Source: SPIUG study)
3900 4000 4100 4200 4300
5000
6000
7500
0
1000
2000
3000
4000
5000
6000
7000
8000
2011 2012 2013 2014 2015 2016 2017 2018
Electric boilers for heating Estimated
data

u
Fig. 23 Electric boilers - estimated data for 2011 - 2018 - trend (Source: SPIUG study)
3.6 Solar collectors
In 2018, in the group of solar collectors, there were significant increases in sales of this type
of installations. In the whole year, the increase in sales of solar collectors was two and a
half times higher than in 2017. Flat-plate collectors are sold in large part, but in the group of
vacuum collectors there was also a double increase in the scale of 2018. Such results are
the result of tenders announced in 2017 and decided from the beginning of 2018. Pro-
grammes and tenders for solar collector installations often take place in municipalities or
their vicinity which have already had some experience with such installations and are the
result of the good opinion of the users of solar thermal installations. There is also a growing
number of installations where the heat from solar collectors is used for heating purposes in
addition to traditional hot water production, although the percentage share of such installa-
tions in the total sales volume of collectors has not changed. The sales result achieved in
2018 was record-breaking in history. For the first time, the sales threshold of 300,000 m2 of
solar collectors was exceeded in one year. On the one hand, this result is certainly encour-
aging, but on the other hand, the sales structure based on municipal umbrella schemes for
low emission reduction is worrying. However, a comprehensive programme to support the
development of this market segment is still lacking. This type of market structure based
largely on object-oriented orders results in a fierce competitive struggle with a limited num-
ber of such tenders, which results in aggressive actions by suppliers who decide to shorten
the distribution chain in order to reduce the price. The market structure based solely on ten-
ders does not guarantee stability, despite the results which they should enjoy. After the col-
lapse in retail trade, there are some signs of recovery also in this distribution segment, but
0
1000
2000
3000
4000
5000
6000
7000
8000
2011 2012 2013 2014 2015 2016 2017 2018
Electric boilers for heating - Estimated
data - trend

36
the situation is still far from normal. In the solar collector segment, sales are mostly made as
part of municipal investments and it can be assumed that the proportion of sales in terms of
distribution channels is 80% through municipal investments and 20% through traditional
distribution channels In any event, there is still no stable market base in the form of a sys-
tem of retail sales through installation and heating wholesalers to individual customers. As a
result, the market for solar collectors may collapse again after the completion of the projects
currently being developed on the basis of EU funds. The opportunity for reconstruction and
further development of this market segment are increases in the installation and heating
market, mainly generated by anti-smog campaigns, for which solar collector installations are
perfectly suited. Currently, the transfer of solar collector installations under the Clean Air
Programme to the group of heating installations supported by subsidies is being considered.
As many random importers of collectors from the Far East have given up selling these prod-
ucts, there is now once again a place for professionals and a chance for recovery in this
market, but it is important to ensure that transparent support rules and clear requirements
for the quality of the collectors that could be covered by such support are consistently en-
sured in this case in order to avoid past situations. Recently, there has been an increase in
interest in the use of RES in heat engineering in combination with the use of heat storage
facilities. Perhaps a new support scheme for the installation of solar collectors for invest-
ments in system heat and industry could be a solution.
Unglazed Flate Plate
Vacuum
Tube
Total Glazed TOTAL
2018 - Newly yearly instal-
led capacity (m²)
0 300 000 10 000 310 000 310 000
led capacity (m²)
0 107 200 3 900 111 100 111 100
Percentual Variation 0% 280% 256% 279% 279%
Total installed capacity in
operation (m²) at the end of
2018
0 2 067 700 490 600 2 558 300 2 558 300
Total installed capacity in
operation (m²) at the end of
2017
0 1 767 700 480 600 2 248 300 2 248 300
Tab. 1 Development of the solar collector market in Poland in 2018 by type of collector
The result achieved in 2018 makes Poland one of the leading countries installing such in-
stallations in Europe, second only to Germany, where in 2018 just over 500,000 m2 of solar
collectors were sold. However, the success and good reputation of users should be dis-
counted at this stage and these factors should be used to restore the stability of this market
segment also in the system without specific support schemes. There are still no specific

u
educational measures on the Polish market that could extend the traditional use of solar
collectors to produce domestic hot water, their wider use to heat houses, also in support of
network heat, and the wider use of heat storage facilities.
Pool heating
Domestic Hot
Water
Combi-
systems
Large
systems
(50m²< X <
500 m²)
Very large
systems
(above
>500m²)
led capacity (*)
2 74 9 13 2
led capacity (*)
2 74 10 12 2
Tab. 2 Development of the solar collector market in Poland in 2017 by type of installation in
[%] of the installed area (Source: SPIUG study)
The estimates collected from the market concerning the percentage share of particular
types of solar collector installations clearly show that there is no revolution in the approach
to the use of solar energy for heating in Poland.
Residential
New built
Residential
Refurbishment
Residential
TOTAL
Commercial
Applications
Other (in-
dustrial,
district,
etc)
2018 - Newly yearly installed
capacity (*)
5 75 80 15 5
2017 - Newly yearly installed
capacity (*)
17 71 88 10 2
Tab. 3 Development of the solar collector market in Poland in 2017 according to the classifi-
cation of customers in [%] of the installed space (Source: SPIUG study
In 2018, the structure of the locations of newly installed collectors also changed. The impact
of building modernization on the demand for solar installations is increasing, as is the share
of commercial and industrial construction as recipients of solar collector installations at the
expense of residential construction.

38
Fig. 24 Sales of solar collectors in general in the period 2014-2018 (Source: SPIUG study)
Fig. 25 Sales of solar collectors in general in the period 2014-2018 - trend (Source: SPIUG
study)
3.7 Radiators and other installation components
In 2018, following the increased demand for boilers, the demand for storage tanks and hot
water heaters increased. This caused delays in the delivery of these products to customers.
In the case of steel radiators, there was a slight decrease in sales both at the end of 2018
and in the scale of the whole 2018. The results were below expectations resulting from in-
105000
194000
174000
223000
245000
115400 111100
310000
0
50000
100000
150000
200000
250000
300000
350000
2011 2012 2013 2014 2015 2016 2017 2018
Solar collectors
0
50000
100000
150000
200000
250000
300000
350000
2011 2012 2013 2014 2015 2016 2017 2018
Solar collectors

u
creases in housing construction. Until the end of 2018, due to good weather conditions, the
stable continuation of the projects continued. As far as sales in the group of radiators are
concerned, December was a very good month (the best in several years). The impact of the
lack of labour force was also evident in installations in this product group. In general in the
group of radiators, the year 2018 was weaker than 2017, mainly due to the inability of in-
stallers to perform particular tasks Generally, according to the information obtained from the
market, the decrease in sales in the group of radiators in 2018 amounted to approx. 5 -10%.
Contrary to pessimistic signals from the market, which indicate a decline, the economic situ-
ation in the construction industry has also caused an increase in the case of classical radia-
tors, mainly steel radiators, but according to installation wholesalers there were no invest-
ment projects, which may indicate the emergence of an alternative way of supplying con-
struction sites with installation materials.
However, there is a growing number of applications for surface heating, with increases es-
timated at up to 20%. A slight increase in sales of die-cast (aluminium) radiators was noted
in comparison to 2017, which was higher by several percent. For other heating system
components the increases are estimated at 15 - 20%. In the group of storage tanks and
buffers, the increases can be assumed to be around 60%. Growth in this product group
could be much higher, but the capacity of the companies is limited, mainly due to the lack of
production workers on the market. There is no reliable data on quantitative development in
various product groups, apart from heating appliances, related to the installation and heating
industry. At present, SPIUG has made efforts to extend its research also to selected heating
system components. Thanks to the cooperation with the group of surface heating manufac-
turers, a real possibility of market research in this product group is now being created.
Gas instantaneous hot water heaters for hot utility water are a solution that has been con-
sistently and slowly coming off the market. A large number of such devices installed in the
last few decades require replacement or are increasingly being replaced by other hot water
solutions, such as dual function condensing boilers or connection to district heating net-
works that also supply the consumer with hot water. In new buildings, these heaters are not
installed at all. In 2018, as in previous years, we can observe a slight, several-percent drop
in sales of these devices.

40
Fig. 26 Sales of gas instantaneous hot water heaters in the period 2014-2018 (Source:
SPIUG study)
Fig. 27 Sales of solar collectors in general in the period 2014-2018 - trend (Source: SPIUG
development)
In addition, estimates of the size of the heating appliance market not included in the above
statistics may be provided in addition: Electric instantaneous water heaters: 2017 - 250,000
units, 2018 - 250,000 units (approx. 220,000 units - low power heaters up to 6 kW, approx.
30,000 units - high power heaters more than 9kW).
112000
104000
91700 92000
86000
81000 79900 81000
0
20000
40000
60000
80000
100000
120000
2011 2012 2013 2014 2015 2016 2017 2018
Gas instantaneous water heaters for hot utility water
0
20000
40000
60000
80000
100000
120000
2011 2012 2013 2014 2015 2016 2017 2018
Gas instantaneous water heaters for hot utility
water

u
Sales of storage tanks and buffers in 2018 may be estimated on the basis of data obtained
from the market at 340,000 units, which is an increase by approx. 54% compared to the
previous year. The increases could certainly have been greater if it had not been for the
capacity problems of domestic producers.

42
4 Summary of the forecast for the develop-
ment of the heating and plumbing market for
the future
Any forecast of the direction in which the market for sales and installation of heating appli-
ances will develop in 2019 and beyond is at least risky. The development of the market for
heating appliances depends on two main factors: the State's policy and the purchasing
power of potential investors who are customers of installation wholesalers. In 2017 and
2018, there were large increases in the sales of heating appliances, to the extent that the
feasibility of the data collected was called into question. In 2017 and 2018, the main driver
of sales was the so-called market for the replacement of old devices with new ones. On the
political side, the slogan was "Fighting the smog." which were later altered in all possible
ways. In addition, the public was educated that it is worth investing in heating devices that
will provide reduced emissions or will not emit harmful substances into the atmosphere at
all. As a result, the so-called umbrella programmes based on Regional Operational Pro-
grammes financed from the EU fund were launched in many communes in Poland. This
made it possible to launch a wave of replacement of old all-fuel boilers with modern, mostly
low-emission heating devices. In September 2018, the "Clean Air" programme announced
by the government was launched, a very valuable and necessary initiative because the is-
sue of reducing low emissions from heating devices concerns a large part of the population
with lower incomes, where the modernisation of a functioning but smoking heating boiler
would place a very heavy burden on the household budget. So far, the effectiveness of this
program seems to be questionable and there has been a period of waiting for a new,
amended version of this support program. Unfortunately, this has had a negative impact on
the sales of some heating appliances since the beginning of 2019. Some investment deci-
sions were frozen until the announcement of the new version of the program run by the Na-
tional Fund for Environmental Protection and Water Management (NFOŚiGW). This affect-
ed mainly the market segment of boilers for solid fuels or indirectly other types of equip-
ment. Some influence on this state of affairs had the fact that some municipalities withdrew
from support under regional programmes (ROP) Local authorities were counting on funds
shifted from low-carbon EU funds to other purposes to successfully replace the availability
of Clean Air support, and this has not been the case. In autumn, the Association of Manu-
facturers and Importers of Heating Devices (SPIUG) warned local governments against
rash decisions and relying fully on the Clean Air Program. Each support programme needs
time to reach the stage when it will work well. In retrospect, it can be seen that despite the
signaling of risk, some policymakers have made such decisions, which now have a negative
impact on the development of the heating market.
Also since 2018, the growth rate in the residential construction sector, which is the main
recipient of heating equipment and installations, has been weakening. It must be admitted,

u
however, that the development of apartment construction was mainly related to developers
who build on plots of land developed in the media in urban areas. For this reason, the main
beneficiaries of the good construction boom in recent years have been rather urban heat
network companies, which have been actively supported by governmental decision-makers
for years. The share of individual construction, traditional customers of individual heating
devices in all categories, i.e. apartments delivered for use, construction permits obtained or
notifications received, and construction projects commenced, decreased. This situation will
certainly also have an impact on the sales of individual heating appliances in 2019 and the
following years. Therefore, the conditions that will be created for the exchange market to
combat low emissions will be of key importance for the development of sales of heating
equipment in the near future. According to preliminary information received by SPIUG, since
the beginning of the year there has been a certain slowdown in the market due to the rea-
sons mentioned above. It should be taken into account that year-on-year increments of
between 20 and 40 % are not normal in the heating industry, even if the boundary condi-
tions are favourable at the time. It can be assumed that in 2019 the results will still be posi-
tive, although not as spectacular as in the previous two years, but everything can change if
the boundary conditions change. The trends of changes from previous years concerning
particular product groups will be continued. The development of energy-efficient construc-
tion and the implementation of energy efficiency requirements for buildings will have an
impact on the selection of heating appliances. Reduced heat demand by eliminating losses
through building partitions and heat recovery from ventilation results in increased demand
for less powerful appliances. Also, the increasing awareness of the storage of excess heat
generated by RES under favourable conditions may increase the demand for hot water
storage tanks with larger capacities than those currently in use. In the case of modern heat-
ing technologies, there is some resistance of a large part of the installers focused on quick
profit with minimum effort. Of course, this is not an accusation, but a statement of a fact with
which it is difficult to argue. It is much easier to install, for example, an air heat pump for hot
water production than to install solar collectors on the roof for similar remuneration. This can
also be explained by the decline in interest in ground or water heat pumps and split pumps
in favour of airborne monoblocks and reversible heat pumps in general in favour of heat
pumps for heating.
Certainly, stable double-digit increases in sales of heat pumps can be assumed, mainly to
newly built houses due to restrictions in installations and locations of modernized buildings.
Of course, many refurbishment projects can be successfully equipped with heat pumps, but
this often requires more work, more materials and more profound modifications. However,
the lack of any spectacular support programmes for heat pumps so far is rather an asset for
this group of heating products, as the market has not yet been spoiled and is developing
naturally. Realistically, every heating technology and every type of heating appliance has a
chance to be successfully used and function well if it is properly selected for the building and
local conditions. Nevertheless, in the time horizon, the increasingly dynamic development of

44
RES-based heating techniques is certain. In Poland, a certain chance to increase the sales
dynamics of heat pumps would be to implement a program under the working name "House
without bills" consisting in the promotion of hybrid systems connecting heat pumps with
domestic photovoltaic installation in low-energy houses. Thanks to this solution, the investor
really obtains heat from the RES, because the electricity supplying the heat pump comes
from the RES, as well as a certain effect of energy independence, which is becoming in-
creasingly popular also in Poland.
Similar reasons justify the growing interest in modern, electrically powered boilers. An in-
crease in the energy efficiency level of buildings, with low investment costs, makes the eco-
nomic calculation of electric heating more favorable. If we add to this the power supply from
our own source of energy in the form of a photovoltaic installation or a wind power plant, we
have a fully emission-free source of heat. Therefore, in 2019 and in the following years a
further stable increase of interest in this form of heating can be expected. It is worth noting
here that electric heating is based, for example, on air conditioners, which are used for both
cooling and heating, similarly to the mass use in the USA, which is in practice a form of heat
pump.
Devices that are becoming more and more popular are heating boilers, single-function or
dual-function boilers, resistance or induction boilers, which in terms of functionality differ
from the popular gas boilers by the type of power supply and no need to drain the flue gas-
es.
In 2018, the sales of solar collectors in Poland reached a record level of over 300,000 sqm.
This result may be surprising, given the very small presence of solar collectors in wholesal-
ers. The reason is simple: solar collectors in Poland are currently sold almost exclusively
through municipal projects which are supplied with this solution by specialised installation
companies. Whether this result will be repeated in 2019 is hard to guess. A number of pro-
jects and tenders have already been completed. The current ones are being implemented in
the financial perspective of 2020. After completion of the projects, the market for solar col-
lectors can be assumed to collapse again after 2020, unless the manufacturers of these
devices agree among themselves on the promotion of this technology and with installation
wholesalers on how to distribute them. The current high interest in solar collector installa-
tions in municipal programs results from the so-called good practice, i.e. good opinion on
the operation of the systems installed earlier and practically zero operating costs, apart from
maintenance costs, including glycol replacement.. A barrier to the development of this
heating technology is still the stereotypical approach to the use of the obtained heat as a
source of domestic hot water only. Meanwhile, using large hot water storage tanks as heat
storage facilities and seasonal heat storage facilities, solar collector installations can be an
excellent year-round heat source for various types of buildings while maintaining appropriate
boundary conditions. Preparatory works are also underway for several pilot projects to use
solar collectors to support network heat in Poland.

u
So far, if nothing has changed, the potential of the tenders can be expected to be about
20% lower than the sales of collectors in 2019, unless the share of sales of these installa-
tions outside the support systems is increased or the solar collectors are moved to the
group subsidised under the Clean Air Programme, which is currently under consideration.
In the case of solid fuel boilers, the situation is more dynamic. Following the entry into force
of the amendment to the Regulation on solid fuel boilers in March 2019, manufacturers and
wholesalers report a significant decrease in sales of backfilling boilers. For some time now,
this decrease has been signaled by the growing interest in automatic boilers. This trend will
surely continue in 2019, especially as at present it is allowed to place on the market and
install boilers with automatic feeder, and in the case of backfilling boilers only those devices
which are equipped with a buffer We still have to take into account the fact that many people
in Poland will burn everything they can find in solid fuel boilers for a long time , so we have
to take into account the so-called grey zone of solid fuel boilers production. It is only up to
the government administration to decide how much of this practice can be eliminated for the
health of everyone, including potential users of such devices themselves.
For several years, the sales of coal-fired boilers have also been declining, with an increase
in the sales of biomass-fired boilers. It seems that the interest in these devices is also de-
creasing among manufacturers. Currently, there are good quality boilers available for pel-
lets, wood chips or wood gasification boilers, if the right quality fuel is provided, the legend-
ary emissions from this type of equipment can be effectively reduced. Straw-fired boilers are
a certain niche on the market, but they are boilers of a specific construction, which are pur-
chased on farms where a lot of straw is produced. The process of transition to biomass,
which is to be the only solid fuel in the future, is consistent and faster than previously as-
sumed.
The beginning of 2019 for solid fuel boilers was not promising. The reason for this is that
potential customers are waiting for final decisions about the position of these boilers in the
Clean Air Programme. It is rather difficult to suppose that biomass boilers will lose their
position. It can be expected that the market for these devices will also grow in 2019, but the
dynamics of growth will not be spectacular. It all depends on the market for the replacement
of old appliances with new ones, because in modern buildings, solid fuel boilers are increas-
ingly rarely installed as a source of heat, but this does not mean that they will be replaced. It
is difficult to imagine that a farmer who has his own biomass resources will give up biomass
as a fuel to another source of heat.
For several years now, the EU has been saying that there has been a move away from gas
as a fuel. Of course, over time this will certainly happen. Fossil fuels are running out. It can
be assumed that in the next 20 years there should be no revolution in this area at least in
Poland. Gas terminals, hubs, investments in shale gas in the world, all this does not happen
in order to resign from it. In recent years, the most spectacular increases in sales of heating

46
equipment have been recorded in gas boilers. The product of gas combustion in condens-
ing boilers is water vapour and carbon dioxide. The latter, of course, is the reason for a cer-
tain persecution of gas as one of the causes of climate change and global warming. It is
possible to discuss the impact of the installed several million gas boilers on the Earth's cli-
mate change. The fact is that as a result of gas combustion there are practically no sus-
pended dusts, which is why gas boilers are so willingly installed in place of old appliances
everywhere, especially if there are no special requirements for changes to the installation,
and you want to get an immediate effect on the improvement of air quality. The market has
been dominated by condensing boilers since 2016. There is a market niche for conventional
boilers that are replaced wherever it is technically difficult to install a condensing boiler with-
out additional difficulties. This small market niche is likely to remain in 2019, but this prod-
uct group is expected to disappear over time. Also for several years there has been a ten-
dency to move away from standing boilers towards hanging boiler cascades. This is a slow
process, but this trend has been continuing for several years and is likely to continue in
2019.
There are also significant upward trends in the importance of surface heating. The radiator
market seems to be stable with a slight decline despite the increase in the number of fin-
ished investments in the construction industry. This is another signal of the slow evolution of
one heating technology in favour of another. The current trend towards better thermal insu-
lation and reduction of heat losses accelerates the development of the market for recupera-
tive installations. And this trend will certainly continue in the coming years. Please note that
the choice of surface heating, nowadays, as in the case of heat pumps, mainly concerns
new buildings. Even taking into account the weakening of the dynamics in the construction
industry, mainly in residential buildings, which was observed last year, this segment of the
market should not be adversely affected.
To sum up: 2019 should be another year of positive results for the heating and plumbing
industry. Perhaps the increases will not be as spectacular as in the previous two years, but
it can be expected that 2019 will also end positively, both for manufacturers and distributors.
The calendars of installers' works filled in by the middle of the year also prove that the crisis
in the industry is not visible. It should also be taken into account that the slowdown in the
construction industry is becoming visible in the installation and heating industry with a shift
of about one and a half years to two and more years. In addition, the heating and plumbing
industry, in particular the heating appliances, stands on the other strong foot of the replace-
ment market. Much depends here on the policy of central and local authorities to what ex-
tent they will be consistent in their efforts to reduce low emissions. The market slowdown at
the beginning of 2019 is due to this factor. In addition, there is a lack of reliable information
on the installed resources of heating devices in Poland. Such knowledge would make it
possible to assess the potential of the replacement market and to plan in a sensible way the
process of replacing old high-emission boilers with new emission-free or significantly emis-

u
sion-reduced installations. It is difficult to predict how the heating market will develop in the
near future, as it depends on many component factors, both domestic and international.
A document prepared by:
Janusz Starościk
Member Pool of Experts Switzerland Global Enterprise
Warsaw, April 18, 2019

Heating device market in Poland in 2018

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