Pike Research: Energy managment market still largely unexplored

Despite everything the U.S. Department of Energy, President Barack Obama and common sense say, energy efficiency just isn’t very sexy. Energy management systems have fantastic rates of return — saving thousands, if not millions. And Cash upfront for installation yields much lower energy bills in the future. But energy management systems are still only penetrating 14 percent of the potential market, according to a new report from Pike Research.
For context, energy management systems do not have to be elaborate. They can be as simple as installing efficient light bulbs, caulking windows, or adding installation. Or they can be as sophisticated as EcoFactor’s thermostat software that optimizes energy savings while automating heating and air conditioning.
One big obstacle to efficiency measures: winning over landlords. Most tenants pay their own electric bills, but renovations are still property owners’ responsibility. As a result, most buildings’ energy systems are antiquated, to be kind. Many tenants will find, if educated, that it is worth their while to pay for installation of home or commercial energy management systems themselves. This is another hurdle for system vendors: average consumers simply don’t know how much they could be saving.
Pike predicts that people will catch on, and that energy management for commercial buildings will be a $6.3 billion industry in the U.S. by 2020.
Climate control and lighting account for 57 percent of the energy consumed in commercial buildings, which themselves account for 20 percent of the U.S.’s power consumption. Improved efficiency through grassroots measures and energy management technologies could save as much as 10 percent of energy costs annually. In residential buildings, there is an even greater potential for energy savings, on a per building basis.
It seems like Obama’s Cash for Caulkers program and similar San Francisco initiatives are on the right track. Grassroots efficiency measures — like weatherization, retrofits and equipment updates — can save enormous amounts of power and money with limited upfront costs.
It also strikes me as more renter-friendly to take a grassroots, rather than corporate approach. Anything that involves a guy in a truck installing products tends to make a landlord curious. Heavy curtains, adding some caulk, and wearing a sweater instead of turing up the heat are all pretty non intrusive.
Still, Pike’s research shows that energy management is a vast and relatively untapped market. As awareness of the Smart Grid and money saving potential increases, more people will be on board with with simple energy management recommendations.
Companies: Pike Research