Recovering from a lengthy slowdown over the last decade, the North American energy service industry appears set for significant growth, bringing with it prospects for increased market responsiveness and on-site generation amongst power consumers. “In tight economic times, the energy service industry is a particularly attractive option for keeping energy industry investments moving forward,” says APPrO Executive Director Jake Brooks. A report from Pike Research in November found that the global market for energy efficient buildings is expected to exceed $100 billion by 2017.
The researchers say the market for energy efficiency services and equipment is rising in large part because governments are looking to reduce energy consumption by improving the efficiency of the building stock. Through the use of energy performance contracting (EPC) as employed by energy service companies (ESCOs) around the world, much of the responsibility for implementing the efficiency improvements is removed from the energy customers and building owners, and transferred to energy management professionals with access to specialized technology and capital. The opportunity is dispersed, but very significant in aggregate. Pike Research sees the total market for energy efficiency in buildings growing from $67.9 billion in 2011 to $103.5 billion by 2017, an increase of more than 50%. The potential investments range from high-efficiency heating, ventilation, and air conditioning (HVAC) systems to the utilization of energy-efficient lighting technologies and load displacement power generation. (The figures from Pike include efficiency investments, not generation.)
“The structure of energy efficient building markets varies considerably from one country or region to another,” says research analyst Eric Bloom, “and vendors and service providers aiming to increase their coverage of energy efficiency markets must remain cognizant of the changing dynamics in order to maintain a strong presence.” Bloom adds that, with regard to the existing building stock, ESCOs are leading the energy efficiency charge for commercial buildings in many countries, using EPC and other financing mechanisms to install energy efficient equipment and kick-start ongoing energy efficiency services. The market for energy efficient equipment, including efficient HVAC and lighting systems, is also in a period of transformation, as green building trends drive increase interest in efficient systems and as efficient lighting technologies, such as LEDs, continue to decline in cost.
Pike Research’s forecasts indicate that the ESCO market will represent the largest segment of the energy efficient buildings industry in the coming years, with revenues more than doubling from $30.1 billion in 2011 to $66.0 worldwide by 2017, a compound annual growth rate (CAGR) of 14%. Significant growth will also occur in the market for high-efficiency HVAC systems, which will expand from $3.1 billion to $6.4 billion during the same period.
Pike Research’s report, “Energy Efficient Buildings: Global Outlook”, provides data on the size and growth of energy efficient building markets, including ESCO revenues, energy efficient HVAC equipment sales, and energy efficient lighting sales from 2011 to 2017, as well as a qualitative description of key drivers and trends in energy efficiency in key markets, focusing on the commercial building sector. It includes a country-by-country analysis.
Pike Research is a market research and consulting firm that performs analysis of global clean technology markets. For more information, visit www.pikeresearch.com.
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