Renewable Systems: A Growth Market for Wholesalers

Geothermal energy is getting a big boost from the federal government. In the next three years, technology advances will receive $70 million in new funding from the Department of Energy, the agency said in June. The DOE said it will use the money to reduce the upfront cost of geothermal energy systems, expand their use and enable the United States to have greater potential access to this renewable energy source.

The projects that this grant will fund will focus on reducing the cost of completing geothermal wells, lowering the cost of exploratory drilling, controlling injection and production of water in geothermal systems, and helping to monitor and optimize reservoir creation. This is a huge step in the right direction for renewable systems. HVACR manufacturers have been tapping into the renewable industry for years, and are finally seeing the trend move in their favor for reducing long-term energy costs.

HVACR Distribution Business magazine spoke with three manufacturers to find out how they are reacting to the growth in renewable systems in the HVACR industry.

“With the cost of fossil fuels on the rise due to dependency on foreign oil, consumers are looking for alternate energy sources,” says John Bailey, senior vice president of sales and marketing at ClimateMaster. “Renewable systems such as geothermal are environmentally friendly and reduce utility costs.”

“We're noticing subtle changes in the renewables industry and a pronounced spike in both consumer and contractor inquiries,” explains Nuno Fernandes, Bosch customer engagement and demand creation director. “In 2011 the average monthly traffic to our consumer website more than tripled compared with 2010, and an important share of our visitors are interested in renewable products. In addition, we also notice contractors starting to offer geothermal as their standard offering versus traditional heating and cooling units. It's a highly competitive marketplace, and differentiating technologies like geothermal offer a powerful tool to HVAC professionals,” Fernandes adds.

Michael Albertson, senior vice president of sales and marketing at WaterFurnace International, explains, “Over the past decade, we have seen the number of companies double who have entered into the geothermal HVAC equipment/system market, by choosing to manufacture their own products or have their products manufactured and branded by an existing company in the business.”

In order to keep up with the demand for alternative energy, manufacturers are constantly identifying needs and customer demands in the form of new technologies. “At ClimateMaster,” Bailey says, “we are constantly designing innovative products. We have designed a new product, the Tranquility 22 Digital Series, which has a lower cost point, a smaller footprint and digital controls. With many consumers choosing to renovate instead of build new, the product fits the need for the retrofit market.”

“WaterFurnace continues to evaluate its customers' needs and identify products, features and benefits the customer is requesting,” Albertson explains. “We then prioritize these needs and set into action a process of product planning, development of specifications for new or revised products, complete the engineering and testing of these products, then proceed with required marketing activities to launch the products to our sales channels.”