1. Domestic Heating and Ventilation Preparation For Change Electrex - Birmingham 17 th May 2006 Kelly Butler Director

2. Struggling To Keep Up? Why we face constant regulatory change How have we arrived where we are today? What can we expect in the future? Key product issues now and in the future The probable industry response

3. Change Is Not Negotiable! The Energy White Paper 2003 To put ourselves on the path to cut the UKs CO2 emissions by some 60% by about 2050, with real progress by 2020 To ensure every home is adequately and affordably heated To maintain the reliability of energy supplies The Energy Review 2005/6 Further action needed on climate change beyond 2012 Rising fuel prices UK is a net importer of gas and becoming a net oil importer

4. The wider view Climate ChangeEnergy Security PoliticalEnvironmental Renewables Nuclear LNG Gas Oil Coal Carbon EfficiencyEnergy Production Mix National Security Result: Ever tighter regulation Energy Efficiency

5. 9 Years of Change & Influence 1997

6. The 2006 Macro Market View Electric Heating Sector Government Agencies etc Europe Energy Policy/Mix Home Energy Report Warm Front/HEES Building Regulations L & F SAP 2005 Code for Sustainable Homes Low Carbon Programme Decent Homes Best Practice Eco Homes ECA Technology list Energy Saving Recommended Energy Efficiency Commitment Advice Programmes Innovation Programmes Information campaigns WEEE/RoHS Directives Energy Using Products Directive Energy Performance in Buildings Directive

7. In A Nutshell Buildings Products Supply Thermally efficient Air tight Lower heat demand Ventilation challenge Highly efficient Sustainable manufacture Local generation demand System specified Lower carbon central generation Financial incentives for local generation Electrical renaissance expected Better metering and tariff options

8. 2006 Product Issues Mechanical ventilation expansion Predictive controls for electric heating Highly efficient direct/storage systems Introduction of new renewable offers –Solar Thermal –Heat pumps –Micro wind and photovoltaic modules

9. Life In 2010 20% further improvement in buildings Tougher challenges: –Diminishing returns on thermal performance –Hot water dominant, low heat load (1-2kW) –Adequate fresh air in an air tight house Probable emphasis towards ventilation, solar and heat pumps

10. 2010 – Product Issues Services integration (traditional heating/ventilation/renewables combinations) –Revised SAP approach –Clear package exemplars for dwelling types Consolidated supply routes (single supply and distribution/professional contractor relationships) –Product and design training –Marketing support –Design services

11. The Next 5 years Large manufacturers backing systems (big players will drive renewables) Distribution framework will converge (merchant and wholesaler takeovers) Introduction of Super Contractors (supported by manufacturers and aligned to the brands)

12. Change Can Be OK If you understand the policy vision and If the industry works towards that vision… in a focused and business like fashion.