The building insulations market saw growth in 2016 following a reduction in market size in 2015, which was in large part due to the government scrapping the Green Deal combined with reduced funding to deliver the Energy Company Obligation (ECO). Despite this slight recovery in 2016 the building insulations products market value is set to decrease again in 2017, albeit only by a small amount. Overall, the building insulations market has suffered greatly since the ending of government initiatives CERT and CESP in 2012, and forecasts suggest it will still be several years before the market recovers to 2012 levels.
The market has seen growth in demand for insulation products from increasing levels of new housebuilding and in non-domestic building, however, the ongoing decline in retrofitted insulation continues to hamper market value. Key market influences include Building Regulations and energy prices. By end-user, the dramatic fall in demand under the Green Deal and ECO means that the most important market is no longer domestic retrofit, with the non-domestic market now having the largest share closely followed by domestic retrofit and new housebuilding.
There has also been changes to the building insulations product mix by value. PUR / PIR products now have the largest market share of insulation products. The market value of mineral fibre products, including glasswool and stone or slag wool, has reduced due to the fall in demand for such products under the Green Deal and ECO, but they still account for a large proportion of the total market in the UK and remain particularly popular in the DIY sector.
Looking forward, the market value of insulation products is likely to show modest growth over the next few years. Growth is impeded by a number of factors, the retro fitting sector seeing further reduction in demand being a significant influencer. Limitations in government funding and new schemes to will also have a negative influence, with evidence suggesting that homeowners are reluctant to implement insulation-based energy saving measures without a strong financial incentive. Additionally, new housebuilding is predicted to slow in comparison to 2016 levels. These factors mean that growth is predicted to remain at a low rate over the next few years.