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issue: November 2006 APPLIANCE Magazine

43rd Annual Report on HVAC
Evolving Comfort


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by Erin Biesen, Associate Editor

The 13 SEER mandate helped give the U.S. HVAC industry a booming year in 2005; now HVAC manufacturers are turning their focus to educating the consumer.

When designing its line of 13 SEER product, Fedders’ engineering team was intent on keeping the footprint as small as possible.

In the fourth quarter of 2005 the U.S. HVAC industry experienced an unusual spike in sales, resulting in record growth for the year. The spike was attributed to the new 13 SEER air-conditioner standards that went into effect at the end of January 2006.
“A lot of people stocked up on 10 and 12 SEER knowing that production would stop in January,” says Dave Pearson, executive vice president for HVAC-producer Fedders Corporation, Liberty Corner, New Jersey, U.S. “So there was an upward movement last year that was not reflective of the industry.”
In 2006 and in coming years, industry insiders see the numbers going back to a normal growth rate. “We certainly expect the industry to be down. Last year was a record year in which we had shipped 8.6 million units domestically, coming after our second-best year in 2004 at 7.4 million units,” says Adam Schuster, manager of product marketing and development for Rheem, who estimates there was an inventory of some 1.2 million units in the field at the start of 2006. “We thought that the first half would be strong because of the regulatory change and then we would see some softening, but we haven’t seen that decrease yet. We think that the shipment numbers are probably going to be higher than anticipated at the end of the year.”
In the U.S., where the industry is well on its way to integrating 13 SEER, manufacturers are focusing on meeting consumers’ other needs and keeping the HVAC industry on top of technology.
Energy Star, which labels appliances in the U.S. as having an energy efficiency level well above that of the minimum standards, has also raised its SEER levels. “Effective April 1 of this year it was changed, so that air-conditioners now need to have minimum efficiency of 14 SEER and heat pumps need a performance rating of 8.2 HSPF (heating seasonal performance factor),” says Bill McCullough, director of Cooling Product Management for Lennox International (Richardson, Texas, U.S.).

“Nordyne’s 23 SEER air-conditioner with iQ Drive™ utilizes inverter rotary technology to achieve one of the highest efficiency levels on the market. The systems feature a smaller footprint, a special new display-screen thermostat and a high-grade-steel motor,” says Marc DeLaurent, product manager of Split Systems. “With a sound-absorbing base, swept fan blade, fixed upper bearing and lower discharge and muffler, the units also deliver decreased energy bills, better dehumidification and the lowest sound levels in the industry. The 23 SEER systems are available in 2-, 3- and 4-ton capacities. A 5-ton iQ Drive unit will be available late 2007.”

Custom-Fit Comfort

Consumers are more aware of the quality and comfort of the air in their homes. “We have a society that is more active, more engaged and more health-conscious than ever before and not just in the U.S., but most industrialized nations,” says Ed Raniszeski, director of market development and communications at Rheem (Fort Smith, Arkansas, U.S.). “Comfort before was being cool or warm. Now it is the degree of warmth or coolness along with all of the aspects of cleanliness, safety and convenience that are associated with comfort. Comfort is now custom fit to each consumer’s specific expectations.”
The air within the home becomes less healthy as new construction becomes tighter. “You don’t have as much outdoor air penetrating the structure, so all the materials that have been outgassed into the home are not being ventilated,” Pearson of Fedders tells APPLIANCE.
As it becomes more important to create healthier air in the home, Rheem says there has been a shift toward two-stage or multi-stage equipment. “Our modulating style of gas furnace has variable-speed motors, where we provide better control of air flow and dehumidification,” says Schuster. “Comfort control has really caught on with consumers.”
Piscataway, New Jersey, U.S.-based Trane released a new filtration system called CleanEffects™. “On the typical 1-inch filter the clean air delivery rate (CADR) was about 12 CADR, then the 5-inch media filter cleaned at 240 CADR,” says Randy Amborn, marketing communications manager for Trane. “The CleanEffects system has a clean air delivery rate of 1,200, so it’s a hundred times better than the low end de facto standard.”
As allergies and asthma affect a larger percentage of the U.S. population, it provides another reason for consumers to look for products that create a healthier environment for their families. “There’s a whole range of products that progressive contractors are offering to consumers based on the customers’ needs,” says Drew Fitzgerald, vice president of marketing for Residential and Light Commercial for Nordyne, located in St. Louis, Missouri, U.S. “They are using electronic air cleaners, media filters along with UV lighting, for example, to clean and sterilize the air.”
Mark Menzer, vice president of engineering and research for the Air-Conditioning and Refrigeration Institute (ARI), notes that the safety of air in commercial buildings has also taken on new significance in recent years. “In our security-conscious age, people are concerned about keeping building air secure and want the ability to clean out a contaminated building quickly,” he tells APPLIANCE. “The cleanliness of indoor air has received renewed emphasis.”
In addition to indoor air quality, another factor of comfort is the humidity level within the living area. This is difficult to control, and most of the time consumers lower the thermostat setting in the house so it feels comfortable, which leads to over-cooling. Lennox is addressing this issue with the introduction of its product Humiditrol. The device can be installed without the need to run another line outside the home because it uses the suction line and the liquid line that are already installed. “This product enables you to set the signature thermostat on the desired humidity level and it will control that humidity without overcooling the space,” says McCullough.

In order to respond to the growing trend of better indoor air quality, Trane has introduced the CleanEffects™ system, which has a clean air delivery rate of 1,200.

Educated Guess

As consumers become more health conscious they are also becoming more educated. No longer are homeowners relying exclusively on information provided by their HVAC contractors.
“Now, in 10 minutes on the Internet, homeowners can get a full education on the products, all the technologies and what they should be asking for,” says Don Sullivan, vice president of sales support and development for Houston, Texas, U.S.-based Goodman. This knowledge has an impact that reaches all the way back to the HVAC OEM. For example, it is now common, Sullivan says, for consumers to request a particular brand and model that they have researched on the Internet.
Rheem also sees more self-educated consumers, and says they can range from their mid-70s down to first buyers in their early 20s. This is helping to push the industry forward in specific directions.
“Because they know more, their expectations have grown, as well as their appetites for better quality and more innovative products,” says Raniszeski of Rheem.
Manufacturers are making sure that dealers are even better-informed to keep up with their customers.
“Dealer training is being emphasized by all manufacturers, who are placing more demands on business owners to modify their sales processes. It becomes more of a value added story and less about efficiency,” says Mickey Smith, senior York brand manager for York, a Johnson Controls company, in Norman, Oklahoma, U.S.
Trane is focusing on educating customers so they can make better long-term equipment purchases. “We’re educating buyers so they understand that it may be more of an investment to buy the systems that will deliver the quality and energy efficiency down the line,” notes Amborn.

The XC15 from Lennox International is twice as quiet as the company’s previous product. This was accomplished by the application of a special molded shroud for the compressor. According to the company, the compressor shroud is a molded composite material filled with a special sound damping material. This shroud also completely encloses the compressor, including the base, which is unlike most compressor sound blankets in the industry.

Web Ready

HVAC manufacturers are expecting to see more integration of communication systems with heating and cooling products. Web enablement is not a new idea, however there is a growing need for it, particularly in commercial applications.
“Facility managers want to monitor and control comfort, they want to know what is going on in their building and they want to do that over the Web on any PC anywhere in the world,” says Amborn.
Nordyne sees Web communication with HVAC systems as a growing need even among consumers. “Communicating systems are something that could eventually lead to someone controlling their heating and air-conditioning systems remotely. If a person is out of town and coming home they can have the air-conditioning come on an hour or two before they arrive,” says Marc DeLaurent, product manager of Split Systems. “That technology is cutting edge right now, but certainly something the industry is looking at.”
There are wireless products that are also helping create better user control of HVAC systems. Trane offers wireless zone sensors that are more flexible than products in the past. “As spaces change they are easily moved,” Amborn tells APPLIANCE. “You can put them in better spots to ensure accurate sensing.”
Self-diagnostics is also growing in importance in the industry. Rheem recently introduced products that incorporate a comfort control system that stores a diagnostic history to help a contractor when he services the equipment. “The service contractor has specific information to make him more efficient at his job,” Schuster says. The technology will also keep the unit from running if it detects conditions that could cause major failure within the equipment.
“The Comfort Control System™ is a building block product and will dramatically change in phases,” Raniszeski explains. “Down the road, people will be communicating directly to their thermostat, with a communication hub that allows them access using their cell phone, PDA or computer at any time from any place in the world.”

Global Industry

One major changing element in HVAC is a move to a more global industry. “We’re seeing more sharing of technologies, and bringing technologies that are used in one part of the world to another,” says Matt Lattanzi, product manager of Furnaces and Package Equipment for Nordyne.
“The manufacturing capacity has grown substantially in China and India, and we are also seeing a rise in middle classes in these countries as they industrialize,” Fitzgerald of Nordyne says. “As a result of this we are seeing increased demand by consumers in India and China for heating and cooling products, and for better indoor air quality and temperature products.”
“The technology community, the sourcing community, and the raw materials community has shrunken,” says Raniszeski.
Globalization leads to a wider acceptance of technologies and HVAC systems that some companies and customers would not have thought of using in the past. “The global perspective brings new options up for consideration. We ask ourselves: Is it cost effective?, Can we deliver it here?, Is it going to deliver good comfort or energy efficiency?” says Amborn of Trane.
Regional preferences for certain HVAC configurations are one reason that HVAC has taken longer than other segments of the appliance industry to go global. In North America, homes are built with air ducts to accommodate ducted heating and cooling equipment. “In Europe they do not have as big a need for air-conditioning, and they use hydronic heating with blowers and radiators,” says McCullough of Lennox. “In Asia, there is a lot of ductless or minisplit systems in use because they are so space-constrained.”
Europeans have also made more
use of ductless minisplit systems, and McCullough feels they may become more common in the U.S. in the coming years, making those types of products more truly global.

Changing Future

Though the 13 SEER adjustment has been made, other standards loom. The HVAC industry will be phasing out HCFC-22, which is used as a refrigerant. In the U.S., HCFC-22 importation or production restrictions go into effect in 2010. Many new HVAC applications are turning to HFC-410A as an alternative. This is not a new development in the industry, but now that 13 SEER is out of the way it is the focal point.
According to Tom Kelly, senior marketing manager for appliances at Sharp Electronics Corporation, Mahwah, New Jersey, U.S., room air-conditioner manufacturers will need a little more time to phase out R22 due to the costs for alternative refrigerants and new technology. “I know a lot of the central air-conditioning people have already been bringing out alternative refrigerant equipment,” says Kelly. “We are going to hold on to R22 until that deadline looms a little bit closer.”
Comfort will continue to be the force guiding the evolution of the HVAC industry. “Comfort is the sound level of the equipment in the home; it is how you control humidity. One big area of comfort that I think is becoming very predominant is the quality of the air in the home—is it dusty, does it smell bad, is there fresh air,” notes McCullough of Lennox. “These elements will be the future of this business.”

Suppliers mentioned in this article:
Fedders
Lennox International
Rheem Manufacturing Company
Nordyne
Trane
A. O. Smith Water Heaters
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