2021
9
UK Thermal Insulation Market Report 2021
2021-08-07T04:13:52+01:00
OX1049171
1495
141247
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Report
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“The UK market for thermal insulation is set for a strong recovery, driven by pent-up demand and a buoyant housebuilding sector. The move to higher energy efficiency standards and low…

UK Thermal Insulation Market Report 2021

£ 1,495 (Excl.Tax)

Description

Providing the most comprehensive and up-to-date information and analysis of the UK Thermal Insulation market, including the behaviours, preferences and habits of the consumer.

The thermal insulation market is expected to return to growth in 2021, with an estimated 6% increase in real terms, followed by stronger growth of 9% in 2022. Growth is set to be primarily driven by a buoyant housebuilding market.

While demand for thermal insulation was severely impacted by the lockdown in Spring 2020, the market started to recover in the latter part of the year, supported by a rebound in construction activity and pent-up demand.

It is fundamental to further improve the energy efficiency of the existing housing stock to mitigate fuel poverty and progress towards the government’s aspiration for homes in England and Wales to achieve EPC Band C by 2035 and the 2050 net zero target. According to the Climate Change Committee’s recommended ‘Balanced Net Zero Pathway’ scenario, a total of 15 million households will receive one of the main insulation measures (loft/wall/floor) and a further eight million will benefit from draught-proofing to 2050. This suggests strong growth potential for key thermal insulation measures in the retro-fit sector.

However, the scale, cost and challenge of the required deployment should not be underestimated. Indeed, the biggest obstacle to adopting building performance improvement measures is the initial cost. Long-term government support, a comprehensive framework of standards and incentives, such as green mortgages and low interest loans, will be required to help overcome this. The CCC has also raised concerns that supply chains are well below the levels required to deliver the government’s ambitions and commitments.

Read on to discover more details or take a look at all of our UK Household, House and Home market research.

Quickly understand

  • The impact of COVID-19 on the UK thermal insulation market in the short, medium and long term
  • Key market drivers in the thermal insulation market
  • How the market is expected to develop over the next five years
  • Key market trends across the thermal insulation market
  • UK building thermal insulation market size.

Covered in this report

Brands: Encon Insulation, Jablite, Kingspan Insulation, Knauf Insulation, Rockwool, SIG, Superglass Holdings.

Expert analysis from a specialist in the field

This report, written by Claudia Preedy, a leading analyst in the Household sector, delivers in-depth commentary and analysis to highlight current trends and add expert context to the numbers.

The UK market for thermal insulation is set for a strong recovery, driven by pent-up demand and a buoyant housebuilding sector. The move to higher energy efficiency standards and low carbon heating in the Future Homes Standard will also exert a positive influence on thermal insulation demand.
In the retro-fit sector, many of the energy improvement measures that are easier to install with lower levels of disruption have already been achieved. Nonetheless, it is fundamental to further improve the energy efficiency of the existing housing stock to reduce carbon emissions and mitigate fuel poverty. To stimulate demand this will require long-term government support and incentives, such as green mortgage products and low interest loans.
Claudia Preedy
Senior B2B Analyst

Table of Contents

  1. Overview

    • Key issues covered in this Report
    • COVID-19: market context
    • Economic and other assumptions
    • Covered in this Report
  2. Executive Summary

    • Impact of COVID-19 on the UK thermal insulation market
      • Figure 1: Expected impact of COVID-19 on UK thermal insulation, short, medium and long term, 3 August 2020
    • The market
    • UK thermal insulation market contracts by an estimated 13% in 2020
      • Figure 2: The UK market for thermal insulation, by sector, 2016-20
    • Building thermal insulation sector starts to recover in second half of 2020
      • Figure 3: UK market for building thermal insulation, by type, 2020, (£ million)
    • Demand for industrial thermal insulation falls by an estimated 15% in 2020
    • Market set for strong growth on the back of buoyant housebuilding market
      • Figure 4: Forecast UK market for thermal insulation, by sector, 2021-25
    • Companies and brands
    • Contracting industry has been bruised by “stop-start” policies
  3. Issues and Insights

    • Wider availability of Green Home Finance options essential to stimulate retro-fit market
  4. The Market – Key Takeaways

    • COVID-19 disruption
    • Buoyant new build sector to drive market recovery
    • Retrofit of the existing housing stock needs much greater focus
  5. Market Size and Performance

    • Overview
    • UK thermal insulation market contracts by an estimated 13% in 2020
      • Figure 5: The UK market for thermal insulation, 2016-20
      • Figure 6: UK market for thermal insulation, 2016-20
    • Building thermal insulation represents vast majority of market
      • Figure 7: Segmentation of the UK market for thermal insulation, by sector, 2016-20
  6. Market Segmentation

    • Building thermal insulation
    • Government policy cuts and failed stimulus schemes result in reduced retro-fit activity
    • UK building thermal insulation sector contracts by an estimated 12% in 2020
      • Figure 8: UK market for building thermal insulation, 2016-20
    • Segmentation by type of building thermal insulation
    • Building insulation rates now mostly driven by new build sector
      • Figure 9: UK market for building thermal insulation, by type of insulation, 2016-20
      • Figure 10: UK market for building thermal insulation, by type of insulation, 2016-20
    • Cavity wall insulation
    • 30% of homes with cavity walls remain uninsulated
    • Cavity wall insulation market value falls by an estimated 14% in 2020
      • Figure 11: UK market for cavity wall insulation, 2016-20
      • Figure 12: UK market for cavity wall insulation, 2016-20
    • Loft insulation
    • Nearly eight million lofts still uninsulated
    • Majority of loft insulation is mineral and glass wool produced in blanket rolls
    • UK market for loft insulation falls by an estimated 9% in 2020
      • Figure 13: UK market for loft insulation, 2016-20
      • Figure 14: UK market for loft insulation, 2015-19
    • Draught proofing
      • Figure 15: UK market for draught proofing, 2016-20
    • Roof insulation
    • Roof insulation benefits from increased demand for loft conversions in domestic sector
    • Pitched roofing accounts for largest element of roof insulation
    • Roof insulation market declines by an estimated 15% in 2020
      • Figure 16: UK market for roof insulation, 2016-20
    • External wall insulation
    • Nine out of 10 homes with solid walls remain uninsulated
    • Solid wall insulation measures delivered in ECO3 fall short of government target
    • External wall insulation market declines by 70% in the five-year period to 2020
      • Figure 17: UK market for external wall insulation, 2016-20
    • Internal wall insulation
    • Materials used for internal wall insulation
    • ECO3 scheme boosts demand for internal wall insulation
      • Figure 18: UK market for internal wall insulation, 2016-20
    • Pipe and cylinder lagging
    • Demand for pipe and cylinder lagging demonstrates relatively consistent growth
      • Figure 19: UK market for pipe and cylinder lagging, 2015-19
    • Floor insulation
    • Floor insulation market grew by an estimated 3% in 2020
      • Figure 20: UK market for floor insulation, 2016-20
    • Industrial thermal insulation market
    • Demand for industrial thermal insulation falls by an estimated 15% in 2020
      • Figure 21: UK market for industrial thermal insulation, 2016-20
    • Industrial thermal insulation by material
      • Figure 22: UK market for industrial thermal insulation, by material, 2020
    • Industrial thermal insulation market by end user
      • Figure 23: UK market for industrial thermal insulation, by end use sector, 2020
  7. Market Forecast

    • Short-, medium- and long-term impact of COVID-19 on the thermal insulation sector
      • Figure 24: Expected impact of COVID-19 on UK thermal insulation, short, medium and long term, 3 August 2020
    • Market drivers and assumptions
      • Figure 25: Key economic drivers affecting MBD’s market forecast, 2019-25 (prepared on 9 July 2021)
    • Forecast methodology
    • Market growth to be driven by a buoyant housebuilding market and higher energy efficiency standards
      • Figure 26: Forecast UK market for thermal insulation, 2021-25
      • Figure 27: Forecast UK market for thermal insulation, 2021-25
      • Figure 28: Forecast segmentation of the UK market for thermal insulation, by sector, 2021-25
    • Building thermal insulation forecast
      • Figure 29: Forecast for UK market for building thermal insulation, by type, 2021-25
      • Figure 30: Forecast for UK market for building thermal insulation, by type, 2021-25
  8. Supply Sources

    • UK production of thermal insulation materials
      • Figure 31: UK production of selected thermal insulation materials, 2015-19
      • Figure 32: Segmentation of the UK production of selected thermal insulation materials, by material, 2015-19
      • Figure 33: Segmentation of the UK production of selected thermal insulation materials, by material, 2020
    • Recent investments at UK insulation material manufacturing plants
    • Trends in imports
      • Figure 34: UK imports of selected thermal insulation materials, 2016-20
      • Figure 35: Segmentation of UK imports of selected thermal insulation materials, by material, 2016-20
    • Trends in exports
      • Figure 36: UK exports of selected thermal insulation materials, 2016-20
      • Figure 37: Segmentation of UK exports of thermal insulation materials, by material, 2016-20
      • Figure 38: UK trade surplus/deficit in thermal insulation materials, by material, 2016-20
  9. Structure of Distribution Network

    • Overview
    • Majority of building insulation sales pass through insulation distributors
  10. Market Trends

    • Increased availability of sustainable thermal insulation materials, but they remain underutilised in the UK market
    • Sustainability plays central role in wider business strategies
    • Launch of new super-insulating materials
    • Innovative, tech-based solutions enable more efficient and less disruptive insulation installation
    • Kingspan’s Kooltherm® K-range claims to comprise the thinnest commonly used insulation products for any specific U-value
    • Robotic insulation solution Q-bot enables more efficient and less disruptive underfloor insulation installation
    • Knauf Insulation develops technology that uses machine-learning systems to enhance performance of Energy Performance Certificates
    • Energiesprong aims to create an affordable, scalable and industrialised market for net-zero housing retrofit in the UK
  11. Regulatory and Legislative Environment

    • Building regulations
    • Future Homes Standard aims to make new homes “zero carbon ready” by 2025
    • Government bans combustible material on high-rise homes
    • Government commits to slash carbon emissions by 78% by 2035 compared to 1990 levels and to reach net zero by 2050
    • Current government policies fall short of the level of ambition required to meet net zero
    • CCC says progress towards decarbonising existing building stock has been very poor
    • 2017 Clean Growth Strategy puts better-insulated homes back on government agenda
    • Proposals to bring forward higher home energy efficiency targets
    • Energy supplier obligation initiatives to improve energy efficiency of domestic homes
    • ECO scheme now entirely focused on fuel-poor and low-income homes
      • Figure 39: Modelled uptake of energy efficiency measures in ECO3 compared to actual uptake
    • ECO funding to rise considerably between 2022 and 2026
    • Minimum Energy Efficiency Standards for private rented sector
  12. Market Drivers

    • Housing stock characteristics
      • Figure 40: Number of UK households, 1991-2020
      • Figure 41: Government predictions of the number of households in the UK, 2020-35
      • Figure 42: Housing stock distribution in England, by age, 2019
      • Figure 43: Housing stock distribution in England, by age and tenure, 2019
      • Figure 44: Housing stock analysis for England, by type, 2019
      • Figure 45: Housing stock distribution in Scotland by age, 2019
      • Figure 46: Housing stock analysis for Scotland, by type, 2019
    • Private rented properties among the least energy efficient in the domestic housing stock
      • Figure 47: UK home ownership trends, 2008-18
    • Improvements in energy efficiency ratings of English homes
      • Figure 48: Energy efficiency rating bands of English dwellings, by tenure, 2019, (% of dwellings)
    • Current insulation levels in housing stock, and remaining potential
      • Figure 49: Remaining potential to insulate the housing stock in GB, December 2020
    • Government energy efficiency schemes drive retro-fit building thermal insulation measures
    • 8% of households had a measure installed under ECO scheme
      • Figure 50: Number of key insulation ECO measures installed, by measure type, Q1 2016-Q1 20121
      • Figure 51: Number of key insulation ECO measures installed, by measure type, 2016-20
    • Share of insulation measures falls in ECO3 due to shift towards heating measures
      • Figure 52: Number of insulation ECO measures installed, by obligation, 2013 – 2021
      • Figure 53: Key insulation ECO measures installed, by measure type
    • Decarbonising the UK’s housing stock will present enormous challenges
    • Launch of new innovation funds to cut cost of home retro-fit measures and boost take-up
    • Green Home Finance Innovation Fund to help the financial sector develop green home finance products
    • Whole House Retrofit competition launched to find new ways of cutting costs of upgrading homes
    • Green Homes Grant scheme scrapped less than a year after launch
    • Drivers in heating and ventilation sector
      • Figure 54: The UK market for data centres, 2015-25
    • Drivers for process plant investment
  13. UK Construction Activity

    • An unusual recovery prospect
      • Figure 55: Market for construction, 2015-25
    • New construction
      • Figure 56: Market for new construction, 2015-25
    • Repair and maintenance
      • Figure 57: Market for repair and maintenance construction, 2015-25
    • Diverse sectors with different influences
      • Figure 58: Segmentation of new construction activity, 2020 (£ million)
      • Figure 59: Segmentation of R&M activity, 2020 (£ million)
    • Housing construction – Major COVID-19 associated downturn
      • Figure 60: Monthly comparison of new housebuild registrations, 2019 and 2020
      • Figure 61: Housebuilding expenditure, 2015-25
      • Figure 62: Segmentation of housebuilding expenditure, by sector, 2015-25
    • Government targets and long-term issues
      • Figure 63: Housing completions in England, 1978-2020
    • Private commercial construction – Long-term susceptibility to recession
      • Figure 64: Long-term development of commercial construction, 1970-2020
    • COVID-19 causes major disruption
      • Figure 65: Commercial construction output, 2015-25
      • Figure 32: Segmentation of commercial construction, 2015-20 (£ million)
    • Private industrial construction – COVID-19 disrupts a buoyant market
      • Figure 66: Long-term development of industrial construction, 1970-2020
    • The unusual impact of Brexit
      • Figure 67: Industrial construction output, 2015-25
    • Warehousing takes centre stage
      • Figure 68: Segmentation of industrial construction, 2015-20 (£ billion)
  14. Companies and Brands – Key Takeaways

    • Contracting industry has been bruised by “stop-start” policies
    • Considerable investment in jobs and skills required
    • Major firms are starting to embrace digital transformation
    • Sustainability plays increasingly important role in insulation solutions and wider business strategies
  15. Industry Structure

    • Industry development
      • Figure 69: Analysis of changes in the other non-metallic mineral products manufacturing industry, 2016-20
      • Figure 70: Analysis of changes in the glass fibres manufacturing industry, 2016-20
    • Contracting industry
    • Structure by employment
      • Figure 71: Analysis of the employment structure of the other non-metallic mineral products manufacturing industry, 2019 and 2020
      • Figure 72: Analysis of the employment structure of the glass fibres manufacturing industry, 2019 and 2020
    • Structure by turnover
      • Figure 73: Analysis of the financial structure of the other non-metallic mineral products manufacturing industry, 2019 and 2020
      • Figure 74: Analysis of the financial structure of the glass fibres manufacturing industry, 2019 and 2020
  16. Company Profiles

    • Encon Insulation
    • Financial performance
      • Figure 75: Financial analysis of Encon Insulation, 2016-20
    • Company outlook
    • Jablite
    • Product innovation
    • Financial performance
      • Figure 76: Financial analysis of Jablite, 2014-18
    • Kingspan Insulation
    • Recent activity
    • Kingspan Group opens global innovation centre
    • Response to issues arising from the UK’s Grenfell Tower Inquiry
    • Financial performance
      • Figure 77: Financial analysis of Kingspan Insulation, 2015-19
    • Company strategy
    • Knauf Insulation
    • Knauf Insulation invests to increase its manufacturing capacity
    • Glass mineral wool product range accredited as DECLARE ‘Red List Free’
    • Financial performance and outlook
      • Figure 78: Financial analysis of Knauf Insulation, 2015-19
    • Rockwool
    • Company strategy
    • Financial performance and outlook
      • Figure 79: Financial analysis of Rockwool, 2015-19
    • SIG
    • SIG sells divisions to focus on insulation and interiors product distribution and merchanting roofing and exteriors product
    • Sale of SIG’s Building Solutions business to Kingspan abandoned
    • SIG launches Return to Growth strategy
    • Financial performance and outlook
      • Figure 80: Financial analysis of SIG, 2015-19
    • Superglass Holdings
    • Major £37 million investment programme completed
    • Company strategy
    • Financial performance
      • Figure 81: Financial analysis of Superglass Holdings, 2016-20
  17. Appendix – Data Sources, Abbreviations and Supporting Information

    • Abbreviations
    • Methodology
  18. Further Sources and Contacts

    • Trade associations
    • Association for the Conservation of Energy
    • British Urethane Foam Contractors Association (BUFCA)
    • Energy Industries Council
    • Energy Saving Trust
    • Insulation Manufacturers Association (IMA)
    • National Insulation Association
    • Thermal Insulation Contractors’ Association
    • Thermal Insulation Manufacturers & Suppliers Association
    • Trade magazines
    • Building Control
    • Insulate Magazine
    • Roofing, Cladding & Insulation
    • Trade events
    • National Homebuilding & Renovating Show
    • Northern Homebuilding & Renovating Show
    • Scottish Homebuilding & Renovation Show
    • Southern Homebuilding & Renovating Show
    • South-West Homebuilding & Renovating Show

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