The energy-as-a-service financing market for energy solutions is expected to grow by 36.8% between 2020 and 2029, according to a new study released by Guidehouse Insights.
The research firm forecasts the as-a-service financing market for energy solutions to grow from $1.6 billion in 2020 to $27.2 billion in 2029.
The market is expected to scale as common definitions evolve and vendors converge around a couple of repeatable models that are known by customers.
North America is estimated to be the largest market for energy-as-a-service (EaaS) financing for energy solutions in 2020, representing 42% of the total market value.
While EaaS definitions continue to evolve, the financing element—focused on OPEX-based payments—is increasingly recognised as the central distinguishing feature of these agreements.
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EaaS contracts allow customers to outsource parts or the entirety of their energy operation while avoiding CAPEX or debt and paying out of the OPEX budget instead. The EaaS vendor owns and controls the installed technologies and guarantees an output, such as heating, cooling, or electricity.
Sasha Wedekind, research analyst with Guidehouse Insights, said: “Customers are attracted to EaaS financing as it allows them to address sustainability and deferred maintenance while upgrading facilities with OPEX-only payments and immediate ROI.
“Multiple market trends support rapid adoption of the EaaS financing model, including growing complexity of available energy technologies, expanding sustainability commitments, and constraints on CAPEX across different sectors.”
Read more about the report.