IEA Heat Pump Conference “Future of Air Conditioning” Workshop

May 15-18, 2017, Rotterdam Beurs WTC Congress & Event Center

May 15, 2017

Minsung Kim
Chung-Ang University
School of Energy Systems Engineering

This document was prepared by staff members of Energy Conversion System Laboratory of School of Energy
Systems Engineering in Chung-Ang University, Seoul 06974, Korea
Energy Balance Flow of Korea 2013 statistics

Imports Primary Energy Transformation Final Energy

Overseas Dependence 280.3 mil. Toe 70.6 mil. Toe 205.9 mil. Toe
95.7%(178.7 bil. $) (100%) (25.0%) (75.0%)

Crude Oil
915.1 mil. bbl Refining Industrial
62.2%
Middle East (86%) 3.0 mil. b/d Naphtha etc.
Naphtha etc
⚫ Saudi(31.3%) Industrlal
Industrial
⚫ UAE(12.1%) Oil Town Gas Resource
Resource
⚫ Kuwait(15.3%) 37.8% 22.4%
22.4%
Asia(10.6%) 19.6 mil. ton Residential
Africa(0.9%) 10.2%
Residential/
Commercial
Heat Commercial
Qatar, Oman, Indonesia 7.9%
1,695.0 thou. toe 17.8%
39.9 mil. ton
LNG 18.7%
Australia, China, Transportation
Indonesia Electricity 17.8%
116.3 mil. ton 5,171.5 bil. kwh
Bituminous 27.2% Public
2.2%
Russia, Canada, USA Nuclear 26.8%
795.0 ton U Electricity
Nuclear 10.4% Bituminous 38.0%
LNG 24.7% Industrial 54.0%
China, Australia, Vietnam Oil 6.1%
8.4 mil. ton Residential/ 39.4%
Anthracite 2.1% Anthracite 0.8% Commercial
Hydro 1.7%
Renewable 1.9% Public 6.1%
Domestic Hydro
Production 4.3% Renewable 3.8% Transportation 0.59%
Air Conditioning Industry of Korea - “Future of Air Conditioning”

Overview of market features

400 0.012

Energy price
Nat. gas for industry
350 (MWh), GCV Nat. gas for
0.01 household/GDP
300 Nat. gas for (PPP) PC
• The retail prices of natural 250
households (MWh),
GCV
0.008

gas and electricity are very 200 Electricity for

industry (MWh)
0.006 Electricity for
household/GDP
low in Korea 150
Electricity for
0.004
(PPP) PC

100
households (MWh)
• People tend to be more 50
0.002

sensitive to the “Initial cost” 0 0

Luxembourg
Hungary
Greece

Korea

United Kingdom
Czech Republic

Italy

New Zealand
Poland
Belgium

Finland

Netherlands

Spain
Germany

Japan
Ireland

United State

Luxembourg
Hungary
Greece

Korea

United Kingdom
Czech Republic

Italy

Poland
Belgium

Finland

Netherlands
New Zealand
Germany

Japan

Spain
Ireland

United State
than the operation cost

Figure Energy price Figure Energy price per GDP

Table Schematic Raw data of energy price *2012 Key World Energy Statistics (IEA)
Czech New United United
Retail Prices ($) Belgium Finland Germany Greece Hungary Ireland Italy Japan Korea Luxembourg Netherlands Poland Spain
Republic Zealand Kingdom State
Nat. gas for industry (MWh), GCV 36.41 50.82 45.19 54.37 56 43.63 43.91 60.21 50.03 38.53 23.76 42.57 37.72 35.51 16.96
Nat. gas for households (MWh), GCV 90.58 82.97 62.18 92.63 108.06 63.73 80.65 64.98 73.53 96.84 102.43 72.2 89.27 64.84 35.94
Electricity for industry (MWh) 138.51 159.94 113.64 157.23 125.57 134.21 152.39 279.31 179.03 (61.94) 117.3 120.56 73.72 121.77 148.77 127.39 69.57
Electricity for households (MWh) 264.37 210.71 213.61 351.95 173.09 233.07 259.47 278.88 260.93 88.64 220.26 237.9 212.1 198.5 295.31 204.92 117.84

Chung-Ang University 3 Energy Conversion System Lab.

College of Engineering School of Energy System Engineering
Air Conditioning Industry of Korea - “Future of Air Conditioning”

Overview of market features

Residential electricity tariff
• There is no peak-load- 250

dependent tariff system, ① ① ② ③ ④ ⑤ ⑥

only six stage (four stages ② 200
③
now) progressive tariffs are ④ Cost (Low V)

imposed ⑤ Cost (High V)

Charge ($)
150
⑥
• No progressive tariffs on 100
commercial and industrial
electricity ①
② 50

• Averaged prices are much ③

④
the same for each sector. ⑤
-
0 100 200 300 400 500 600
⑥ Electricity consumption (kWh)

Chung-Ang University 4 Energy Conversion System Lab.

College of Engineering School of Energy System Engineering
Air Conditioning Industry of Korea - “Future of Air Conditioning”

Overview of market features

Climate of Korea
• Summer influence by North Pacific high-pressure zone
- Hot and humid summer (75% RH, DB > 30°C)
• Winter influence by Siberian high-pressure zone
- Cold and dry winter (DB < –5°C)
Load by sectors
• Different air-conditioning load by sectors
- Residential heating load is 3 times larger than cooling.
- Commercial cooling load is 1.5 times larger than heating.
• Residential cooling is mandatorily required but short
running period. (efficiency? function/design!)
• Commercial cooling charges a large portion of building
energy demand. (efficiency!!)

Chung-Ang University 5 Energy Conversion System Lab.

College of Engineering School of Energy System Engineering
Air Conditioning Industry of Korea - “Future of Air Conditioning”

Market Trend
As a result of the market features
• By sector
- Residential air-conditioning is floor heating and air cooling
- Commercial units requires both heating and cooling function for commercial units
• By source
- High penetration rate and low energy price of natural gas, but much lower electricity price.
- Relatively lower interest on gas-driven air-conditioning other than peak-load control.

Recent trend in market

• For residential sector, functions than performance
- For residential sector, additional functions like filtering fine dusts are getting more important.
Residential air-conditioning is floor heating and air cooling
• For commercial sector, performance comes first

Chung-Ang University 6 Energy Conversion System Lab.

College of Engineering School of Energy System Engineering
Air Conditioning Industry of Korea - “Future of Air Conditioning”

Market Characteristics
Korean air-conditioner production
Market structure based on 2015 statistics
(total 1.73M USD)

• Market size : Saturated market between 1.5 to 2 Billion USD

including residential and commercial air-conditioning.

• Major manufacturers : LG electronics, Samsung electronics

- Manufactures and installers are not separated.
Manufacturers usually installs the equipment.
- Ready-made air-conditioners are occupied by major
manufacturers.

• Full line-ups from absorption to electric air-conditioner

- Smaller manufacturers produce absorption machines and
light commercial machines.

Chung-Ang University 7 Energy Conversion System Lab.

College of Engineering School of Energy System Engineering
Air Conditioning Industry of Korea - “Future of Air Conditioning”

Future of Technology and Market

Air conditioner technology
• Development of multi-functional air conditioner
• Manufacturers will keep going on the improvement of energy efficiency.
• Increased interest on non-vapor compression technology as a breakthrough of current market

Air conditioner Market

• The market will increase smoothly for a while
- Due to global warming effect, cooling is increased gradually.
- Increased influence by fine dust, multiple functioned air-conditioners will drive the market.
• The air-conditioning market depends greatly on energy price.
- New government plan to reduce coal and nuclear based power generation. And focus on
renewable energy which results increase the electricity price.
- Potential possibility of thermal driven air-conditioner.

Chung-Ang University 8 Energy Conversion System Lab.

College of Engineering School of Energy System Engineering