Improving Construction Market + Stricter Energy Efficiency Standards = Greater Polyurethane Demand
Originally published by: ICIS — September 19, 2014
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Nearly one-third of the energy consumed in the US can be attributed to the building sector, and that number is expected to increase by more than 62% by 2050, according to a report published by the International Council of Chemical Associations (ICCA) in December 2012.
New building codes need higher performance with respect to energy efficiency. ICCA’s Building Technology Roadmap highlighted potential energy savings from five building technologies, including insulation, pipe and pipe insulation, air sealing, reflective roof coatings and pigments, and windows.
Polyurethanes (PUs) are critical components of many of these products. In fact, various forms of PU foam insulation (polyiso board, spray foam and insulated metal panels) and adhesives are approved materials for meeting new building code requirements. The continued recovery of the residential housing and commercial building markets, combined with the need to meet stricter energy efficiency standards, is creating healthy demand for PUs in the construction industry.
“In the US, high performance building codes and the high cost of fuel to heat and cool buildings and residences are strong motivators for building owners to seek out the most energy-efficient building materials,” says Laura Reinhard, global business manager for spray foam insulation with Honeywell.
Increased energy efficiency is also a strong driver for higher insulation values in the industrial construction segment, adds Pat Clifford, global business manager for panels with Honeywell. Specifications for R-values are also becoming more stringent across climate zones.
Growth in demand for PU in various segments of the construction market can be attributed to the overall economic recovery and consequent growth in the construction industry as well as increased interest in switching to PU foam to achieve better insulation.
“Energy consumption in buildings is largely related to heating and cooling, and thus depends on the ability to prevent undesired heat transfer. Polyurethane foam has a high R-value and can be applied in various forms in different areas of a building to provide both continuous insulation and air tightness,” says Mahesh Kotnis, commercial director of Huntsman Corporation’s polyurethanes business. Interest in above-code Near-Zero energy construction also continues to grow, according to Richard Skorpenske, director of polyurethanes advocacy for Bayer MaterialScience.
While housing starts have not returned to pre-recession levels, they exhibit year-on-year growth, and the underlying demographics of population growth suggest they will reach at least 1.5m starts annually within the next few years. “As the number of new homes grows, naturally the share of PU materials will grow,” notes Woody Gontina, residential segment manager, performance materials with BASF. He notes that beyond organic growth, the increase in energy efficiency standards and desire of builders to differentiate will help to raise market share for PU as the size of the pie increases.
However, housing starts do not tell the whole story, says Kotnis: “The renovation/retrofit segment of the construction market is significant and contributing noticeably to the demand for PU products. The median age of homes in the US is approximately 40 years, and about 25% of homes were built in the 1950s and 1960s. As a result, about 50m houses are under-insulated.”
Reinhard adds that with housing starts at their current levels and more than 130m existing home units in the US good candidates for retrofits, there is an untapped market. Part of the renovation activity, says Gontina, is due to the fact that many people are staying in their homes because they cannot sell them.
“Importantly, in these cases, homeowners are more likely to choose higher-performance materials with a focus on durability and energy efficiency, and PU products are often the desired choice,” he says.
The commercial building market is an untapped area for upgrades, notes Skorpenske. “Concerns about energy consumption, costs and climate change continue to encourage support for increases in the energy efficiency of existing buildings,” he notes.
The particular building codes that drive the use of PU foam, adhesives, and other products are based on the International Energy Conservation Code (IECC, latest version 2015) and the ASHRAE 90.1 (latest version 2013) energy standard of the American Society of Heating, Refrigerating and Air-Conditioning Engineers. One of the major improvements in these codes is the requirement that continuous insulation be installed in the walls of commercial and residential buildings.
“Continuous insulation is more effective than insulation that is only installed between the framing. Fibrous insulation materials that are used between framing (like fibreglass and cellulose) aren’t suitable as continuous insulation, but PU polyiso board and spray foam work very well,” notes Skorpenske.
These standards also require higher R-values and air tightness, and PU insulation products can meet all three of these performance criteria, according to Kotnis.
There are also code changes that apply to roof retrofits. In this case, contractors replacing a roof must retrofit it to an insulation level that meets the most current version of the relevant building code. “Because insulation levels have risen over time, often the replacement roof must be insulated to a higher level than the old roof being replaced. Polyiso board is the dominant insulation material in low-slope commercial roofing, and therefore this change will also be a driver for growth of polyurethane insulation,” says Skorpenske.
It is important to note, adds Robert York, strategic market manager for Dow Polyurethanes, that these standards, such as the requirement for continuous insulation, are science-based. “When you start taking into account all the aspects of the building and how heat flows in and out, and you build codes around that, you actually start to get buildings that perform at a much higher level. It provides a holistic picture of how energy efficiency can be designed into buildings. That in turn acts as a great stimulus for the PU market,” he says.
Gontina agrees that as our understanding of building science and energy efficiency improves, manufacturers are forced to test and validate products to ensure they address issues that are uncovered. As an example, he points to air infiltration and its contribution to moisture migration within a wall assembly. “PU products act as air barriers and therefore contribute to the air tightness of buildings and help address moisture issues,” Gontina notes.
Manufacturers of PU construction products use science to improve product performance and develop materials to improve energy efficiency in buildings. “The desire for increased energy efficiency has been driving the development of polyurethane foams for decades because it is proven to be among the best insulating materials ever invented. As such, the desire for increased energy efficiency is one of the key drivers pushing polyurethanes technology to further and further levels of thermal efficiency by exploring cell structures and the behaviour of the material under different conditions,” says York.
Kotnis points to improvements in the fire resistance of spray foam so a separate fire protection barrier is not needed in certain attic and crawl space applications. Dow’s VORATHERM shield technology, which provides increased fire performance, and its VORATHERM non-halogenated foams that provide energy-efficient solutions without the use of traditional halogenated flame retardants, are examples of this technology. Foam wrap insulation is now used in HVAC applications to wrap vents limiting conditioned air loss, according to Greg Lonc, business manager, monomers, BASF.
It is important to note, adds York, that PU foam is not the only product that can improve the energy efficiency of buildings. “There is a lot that goes on in building and construction to improve energy efficiency that has to do with air sealing. Both do-it-yourself (DIY) and contractors use multiple solutions to air-seal homes to prevent leakage of conditioned air from the home or structure.
For example, Dow’s GREAT STUFF insulating foam sealants which permanently fill pipe penetrations, gaps in structures where two materials meet and any space that allows air to enter or leave the building envelope. The use of PU adhesives rather than physical fasteners to join polyiso board or expanded polystyrene boards for roofing insulation is another example. The fasteners can act as sites for heat loss, while the use of the PU adhesive provides a complete barrier, says Kotnis.
In the industrial construction sector, the desire for increased energy efficiency is motivating the industry to adopt innovative technologies for insulated metal panels, such as Solstice liquid blowing agent (LBA) – an ultra-low global warming potential hydro-fluoro-olefin (HFO) blowing agent from Honeywell that provides increased R-values compared to hydrofluorocarbon (HFC) and hydrocarbon alternatives, says Clifford. It started up a new world-scale plant for Solstice LBA in May 2014.
Interest in increased energy efficiency is not limited to the US. After shutting down all of its nuclear power plants, the Japanese government was forced to find alternative sources of electricity (30% of the country’s total) generated from nuclear power. While placing an emphasis on renewables (the country imports all its oil and gas), one of the initiatives is to lower fuel consumption by improving thermal insulation of buildings, says Reinhard.