Annual revenue generated by energy service companies is set to increase by 4.5% between 2020 and 2029, according to a new study published by Navigant Research.
By diversifying project development efforts, developing new technology-agnostic capabilities and financing options outside energy savings performance contracts (ESPCs), energy service companies can generate up to $28.7 billion (€26.1 billion) in revenue per annum.
Factors providing opportunities for energy service companies include:
- Consumers becoming more sophisticated and need for cost-effective, customized, and comprehensive energy solutions to meet new energy efficiency standards.
- Utilities introducing new financial and business models to meet emerging customer needs.
The market for energy service companies is mature in the US and expanding in other regions. In the US, the majority of revenue was generated through energy efficiency and ESPCs.
However, pressure from competing energy services models and changing customer expectations are hindering market players.
Sasha Wedekind, a research analyst, said: “ESCO offerings have gained recognition as a valuable way for public organisations to realise sustainability mandates while meeting operational, financial, and human capital goals.
“Though growth is expected to continue, it is expected to be challenging to capture due to pressure from competing energy services models and changing customer expectations.”
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