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issue: January 2005 APPLIANCE European Edition

On Location in Nürnberg for IKK 2004
IKK: Cold Air, Hot Business

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by Paul Roggema, European Correspondent

APPLIANCE traveled to Nürnberg, Germany to report on IKK, held Oct. 13-15, 2004.

IKK 2004 lived up to its reputation as one of the most important trade shows for the European cooling, refrigeration, and ventilation industry.
IKK: aria fredda e autunno caldo per gli affari
APPLIANCE si è recato a Norimberga, in Germania, per la Fiera IKK in programma dal 13 al 15 ottobre 2004. Dal risparmio energetico e la concorrenza internazionale agli ultimi sviluppi sull'anidride carbonica, la venticinquesima fiera annuale di Norimberga ha dimostrato di essere per gli intervenuti una tribuna importante per la discussione delle questioni e delle tecnologie di maggior interesse per l'industria europea della refrigerazione, del condizionamento dell'aria e della ventilazione.
IKK: Kalte Luft, ein heißes Geschäft
APPLIANCE reiste nach Nürnberg, um über die IKK (13.-15. Oktober 2004) zu berichten. Von Energieeffizienz und internationalem Wettbewerb bis hin zu Neuentwicklungen im Bereich Kohlenwasserstoff - die 25. IKK erwies sich als wichtiges Forum zur Besprechung der jüngsten Entwicklungen und Technologien, mit denen die europäische Industrie für Kühl-, Kälte und Belüftungstechnik konfrontiert ist.
Salon international de l'IKK : Activités en plein boom dans le secteur de la réfrigération
APPLIANCE s'est rendu à Nürnberg, en Allemagne pour vous informer sur l'IKK, le salon international consacré au froid, à la climatisation et à la ventilation qui s'est tenu entre le 13 et 15 octobre 2004. Depuis l'efficacité énergétique et la compétition internationale jusqu'aux progrès réalisés en matière d'utilisation du dioxide de carbone, la 25ème édition du salon annuel de l'IKK s'est avéré un forum efficace qui a permis aux participants de débattre des toutes dernières questions et technologies affectant l'industrie de la réfrigération, du refroidissement et de la ventilation en Europe.

This year’s IKK was held in Nürnberg, Germany, where more than 27,700 visitors attended the show, 18 percent more than last year’s fair in Hanover. And while the October weather may have been cool, the business going on at the Exhibition Centre was definitely hot.
In fact, the increase in 2004 attendance may support some industry players that are questioning whether or not Hanover should continue to be the alternating location for the annual fair. Some see the city as expensive and too far away from most exhibitors. During an international press conference at the Nürnberg fair, many asked about the long-term contracts with the Hanover fairgrounds, but no concrete answers were given. As of press time, the 2005 show was scheduled for November 2-4 in Hanover.

None of this talk, however, could influence the upbeat mood at IKK. Due to the exceptionally hot European summer in 2003, air-conditioning sales are way up. Some manufacturers are even having trouble keeping up with demand. The industry saw growth in all sectors—residential, light commercial, and large systems.

While Europe has been slow to see air-conditioning (A/C) as a necessity, most large office buildings and international hotels now have the technology, although market penetration in small offices and houses is still in the single digits. In recent years, car manufacturers managed to make A/C a standard feature, which has helped change consumers’ attitudes toward the product. One of the reasons for this success was that the automotive industry redefined A/C from a luxury product to a safety feature.

With more than 90 nations represented, the fair also had a large international presence, an indication that the HVAC industry is getting more global. The share of international exhibitors (outside of Germany) was 65 percent, with the largest number of exhibitors coming from Italy.

“Exhibition activity at IKK has been characterized by a large increase in international attendance and a rather steady level of attendance from Germany,” confirms Chirstian Scholz, president of VDKF e.V., the fair’s promoter. He adds that IKK 2004 was also successful in attracting more visitors from Germany, which tends to be a small player in the HVAC segment.

During a keynote address, Joachim Paul, a professor at the Department of Mechanical Engineering of the Technical University of Denmark in Copenhagen, gave some interesting insights into global aspects of the industry. Specifically, he focused on the growing importance of using energy-efficient products in all parts of the world. As an illustration of inefficient use of resources, he showed several pictures of Asian offices and residential buildings. One building had 320 separate split units. Some units were mounted on top of other units, so the hot air from the underlying units could effectively ruin the performance of the other unit. By using central A/C, Mr. Paul demonstrated that energy savings of 50 percent can easily be achieved.

However, because climate control generally is not included in the construction phase (to keep costs down), he said the consumer often has no other choice than installing separate units, at higher running costs. And in cities like Singapore, where A/C runs all day long, for many months, efficiency losses are huge. Only government regulations can help here, Mr. Paul noted. He added that there are already power shortages in many Asian areas, and that central A/C should be a necessity for this reason alone.

Following the trend of offering using CO2 in refrigeration, Embraco exhibited its CO2 prototypes.

The CO2 Story Continues...

Most of the space at IKK was occupied by suppliers of commercial refrigeration. However, most of the major compressor makers exhibited, as well as the major A/C manufacturers. Embraco of Brazil, considered a leader in the compressor segment; ACC (U.S.), the former compressor division of Electrolux; and Danfoss were all present. Tecumseh (U.S./France), which is very strong in commercial applications, was also in attendance. Matsushita, however, did not exhibit.

A clear trend, continued from 2003, was the products based on CO2. Danish industrial conglomerate Danfoss surprised IKK 2003 visitors by presenting the first CO2 compressor test model and since then, has seen much interest in the technology. “Since the last IKK, we have produced about 150 test models,” Jürgen Süss, project leader, told APPLIANCE. “A few Danfoss customers are performing tests to find out how and in which applications CO2 may be used. We are now ready with the compressor concept and are in the next phase, where we confirm reliability. So we have changed from developing the concept to developing the actual product.”

According to Mr. Süss, CO2 is getting more important as time goes by, because of the clear trend to replace HFC refrigerants. “Hydrocarbons are a good choice for smaller appliances, especially in protected domestic environments,” he said. “But in vending machines, for instance, it is hardly acceptable…as it is simply too vulnerable. Just one accident is a great financial risk for the large beverage companies.”

While Mr. Süss admitted that Danfoss has not presented any breakthrough developments, he believes the company’s prototypes have certainly supported the move to CO2. “This process will still take a lot of time and effort,” he said.

In general, Danfoss is very happy with business. Kurt Deutschbein, Danfoss sales and communication manager confirmed: “2004 has been a good year for us, and we hope this will continue in 2005; however, we have no firm prognosis yet.”

In terms of increased international competition, Mr. Deutschbein says Danfoss will continue to strengthen its image as a partner with great application and product know-how. “Our application engineering’s department traceable test facilities, laboratories, R&D department, and all-round understanding of cooling are second to none,” he said.

Danfoss’s new products include its BD series, which combines dual-voltage operation with variable speed. The DS product line was designed to enhance top household models into commercial capacity range. For the ever popular vending machines, the NL and MF models are offered.

Naturally, Brazilian Embraco is also working on CO2. “We did an extensive research project with different universities and research institutes,” Marino Bassi, global key account manager, told APPLIANCE. “We now have a single-stage compressor with a 450- to 1,350-W performance range in MBP (medium back pressure) and 290- to 850-W in LBP (low back pressure) applications. There is also a cassette version. Immediately after IKK, we will deliver samples to our main customers for test and refrigeration system development purposes. More development is needed, especially on the refrigeration systems, to get the efficiency as good as existing solutions, mainly for the LBP application.”

When asked about competition from Chinese HVAC companies, Mr. Bassi said that Embraco already produces about 1.7 million compressors per year in China, mainly for the local market. “Right now, the Chinese producers cannot compete with our current high-performance products,” he says. “But the time will come that Chinese products will match our actual premium products. We are well aware of this threat, and we are preparing further developments to maintain the gap.”

One product trend, Mr. Bassi noted, is energy and noise reduction in commercial refrigeration. In response, Embraco offers its high-efficiency NEK line (both for HFC and HC refrigerants) and its new NT, which is said to use about 15-percent less power than the previous model with lower noise.

Mr. Bassi added: “From the energy efficiency point of view, our top product is the VCC (variable speed) line, which has been extended with several commercial models and cassette versions.”

Embraco has also moved into larger commercial models, thanks to a cooperation with U.S. manufacturer Bristol. How is this segment now? “We enlarged our product range as planned, and we are satisfied with market growth,” Mr. Bassi told APPLIANCE. “A clear trend in this market is toward condensing units instead of separate components. We are determined to improve our business in this segment.”

Pumping Efficiency & Commercial Compressors

The new AquaSnap Puron from Carrier is said to be the first commercial chiller to use R410A. Other features include cadmium-free electrical components, soldered connections for maximum leak-tightness, and electronic temperature and pressure sensors. Lower noise levels were achieved by designing the compressors on a special chassis and surrounding them by an acoustic enclosure.

Pumping Efficiency

Another IKK topic was the savings offered by heat pumps, a technology still uncommon in some parts of Europe, specifically Germany. In Sweden, this technology has a 85-percent market share, against only 0.5 percent in Germany.

Bernhard Wenzel, a spokesman from heat pump industry association Klima-Innovativ, explained that an average energy bill can be lowered by as much as 75 percent by using heat pump technology. An average heat pump installation transports earth heat from the evaporating circuit side to the condenser, usually mounted as floor heating. Typical temperature of evaporating pipes would be -5°C, and condensing temperature about 60°C. Coolant is R410A, using normal scroll compressors. When pipes are about 1 m below the surface, temperature is mostly constant at 0°C, perfect for use all-year-round. When there is no room in the garden, a vertical ground probe can be used. The pump’s efficiency factor (output heat versus input electricity) can be up to 5.6. Other (less-efficient) methods are air and dual water wells, which have efficiency factors of 3.7 and 4.5, respectively.

So why this low market share with all of these obvious advantages? “In Germany, the installer is king,” Mr. Wenzel explains. “But, as we love regulations, there are all kinds of qualifications the installer should have: electrical, refrigeration, and heating. For a heat pump, all three were required until the beginning of 2004 and very few installers are that qualified, effectively limiting the number of businesses that sell this product.

“Second, the installers make money with yearly services, more than initial sales and installation,” he continued. “As heat pumps require almost no maintenance, installers will not promote the product until a different business model is developed. Third, electricity is seen by some people as the wrong source for heating, sometimes linking it to nuclear power.”

But with a 75-percent energy savings, Mr. Wenzel believes manufacturers can’t ignore this technology and that they need to educate their industry partners. “Clearly, we need better promotion and to build up confidence so that our installers are capable of mastering the sometimes more complex design issues.”

Commercial Compressors

Tecumseh, a key compressor manufacturer for the commercial refrigeration market, says it too has a positive outlook on the HVAC business. “We are satisfied about the slight growth we are experiencing, and we expect this to continue,” said Regis Leportier, marketing director for Tecumseh Europe. “The trend toward (pre-assembled) condensing units with more features will help here, as it has more added value.”

Mr. Leportier also said that environmental considerations from large customers such as Unilever and Coca Cola are expecting to replace HFC-type refrigerants by hydrocarbons, at least in Europe. “U.S. customers have a quite different perspective on this, partly because of the different insurance situation,” he explains. Tecumseh also expects more interest in energy saving issues among commercial users.

In products, the company is offering new condensing units with horizontal rotary compressors. According to Mr. Leportier, the compressors perform better on all parameters: lower noise levels (noise awareness is cut by 2 to 4 times) because of the rotary principle (instead of reciprocating pistons) and the electronic fan motor; less hot air is blown out because of the lower condensing temperature; and a reduction in power consumption of up to 30 percent.

In larger products, Tecumseh’s new horizontal rotary compressor line uses a three-phase a.c. [motor], at frequencies from 40 to 80 Hz, and capacities from 800 to 3,000 W. Speed is variable, reportedly allowing more precise temperature control, up to one tenth of a degree, compared to one degree for an alternating compressor.

Hot Times for A/C

In the hall reserved for the A/C products, manufacturers shared the upbeat mood. “After the heat waves in the 2003 summer, demand exploded in autumn and winter,” Mazin Ghannam, Carrier’s export director, told APPLIANCE. “In April 2004, we had no stock left. Then July and August 2004 were mild and demand slowed down. But in general, sales doubled or sometimes tripled.”

Mr. Ghannam noted that all A/C markets did well—residential, light commercial, and large installations. “However, in large systems, the reaction of the markets to weather conditions is different,” he said. “There, the market penetration of air-conditioning is 70 percent or more, where residential products only enjoy a single-digit level.”

At IKK, Carrier presented the new AquaSnap Puron. This air-cooled chiller (190 to 760 kW) is said to be the first to use R410A for commercial and industrial use. R410A, referred to by Carrier as Puron, is chlorine-free and is a stable blend of 50 percent R-32 and R-125. It has been used in residential systems for almost a decade.

By using R410A, Carrier says all environmental requirements are met while achieving optimal efficiency: the energy-efficiency rate (EER) is 13 percent higher than R-407C. Several other improvements were made to the chiller: cadmium-free electrical components, soldered connections for maximum leak-tightness, and capillary tubes and flare-type connections have been replaced by electronic temperature and pressure sensors directly connected to the piping. These can reportedly be checked and replaced without the need to transfer the refrigerant charge. The company says noise levels are halved by using rotary scroll compressors, mounted on a special chassis and surrounded by an acoustic enclosure. Optional features include direct-expansion free cooling, which can be applied in the wintertime when extra cooling is needed for situations such as computer room cooling (ideal for Northern Europe).

Representing China

One issue everyone is discussing is the success of Chinese companies in the European market. Who can speak to this better than Haier, the largest Chinese brand? “In A/C, sales rose almost 100 percent [in 2004], and we enjoy a 8-percent market share in Europe,” stated Ma Chunyu, director of Haier’s European Division. “For white goods, we have a separate sales organization. In Spain, Italy, and the UK, we have local Haier establishments; in other markets we have contracts with distributors.”

Mr. Chunyu noted that the Chinese market is seeing a lot of the same industry trends as in other global regions. “In 2002, there were about 400 A/C manufacturers, but this has consolidated to about 50 companies in 2004,” he says. “Due to high prices for resources, many smaller companies disappeared. Our company must compete on innovation, not only on price, to match the Japanese competitors.”

For Europe, Mr. Chunyn says Haier’s target is a 15-percent market share. “Of course, we are building the service organization for this,” he said, “and we need to continue building the Haier brand by offering good products. We think that the brand awareness will follow the quality of the products.”

One of the company’s new products is a room unit featuring a “Smart Eye,” an IR sensor that detects motion and activates the system. A light sensor can make the system switch off in darkness, and a bacteria-killing medium is provided for health-conscious customers. For mid-size applications, Haier offers the X-Multi range featuring d.c. inverter technology, R410A products, a wide variety of indoor and outdoor units, and all the current control options.

Keeping it Hot

From energy efficiency and international competition to developments in CO2, the 25th annual IKK proved to be a useful forum for attendees to discuss the latest issues and technologies affecting the HVAC segment. In the show’s closing report, organizers said 94 percent of surveyed exhibitors spoke favorably of the information and contacts offered at the exhibition stands and 97 percent said they were satisfied with the products on display.

After a year of positive sales results and increased product development, HVAC companies are hoping 2005 will be just as successful, with a favorable economic environment and continued innovation.

Suppliers mentioned in this article:
Embraco Europe S.r.l.
Secop GmbH
Tecumseh Europe S.A.

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