European Energy Savings and Performance Contracting Growth Opportunities

Description

Strategic Partnering and Innovation Culture in ESPC to Uphold Buildings' Operational Efficiency

As the construction industry resumes a level of pre-pandemic operational efficiency and commercial establishments reopen, energy demand from buildings in Europe has surged. For a brief period between 2020 and early 2022, energy efficiency measures did not grow rapidly, despite enabling regulations. This period hampered the achievement of several goals related to energy efficiency. Across Europe, renovation rates for buildings stand at a meager 0.2%, but 3% is needed annually to achieve European Climate goals for 2050. As a result, huge growth opportunity awaits the European energy savings and performance contracting (ESPC) market.

The European ESPC market recorded a 1.4% growth rate in 2021 due to the COVID-19 pandemic. However, the market is likely to expand moderately at 4.4% from 2021 to 2027 in response to renewed focus on energy efficiency and regulations in each country to promote energy savings and improve living conditions.

The European ESPC market covers services such as energy audits; design and engineering; assistance in finance, equipment bidding, and acquisition; installation and commissioning; measurement and verification (M&V); and personnel training.

Energy savings contracts (ESC) contributed two-thirds of the revenue generated through ESPCs in 2021. Although ESC is set to have a higher share of the market in 2027, energy performance contracts (EPC) will register a much better growth rate of 7%. The three major countries-Germany, France, and the UK-accounted for 60% of the market in 2021 and will remain the market leaders throughout 2027. The Benelux region will register the highest growth rate, thanks to tax incentives and a heat pump mandate in Belgium and the Netherlands.

This study segments the market based on building components: lighting and controls; heating, ventilation, and air conditioning (HVAC); building automation systems (BAS); and building fabrics. By vertical market, the study looks into offices, healthcare, education, industrial, retail, hospitality, and government and public buildings.

Frost & Sullivan expects the market to experience increased convergence among allied industries such as facilities management (FM) providers; energy service companies (ESCOs); IT service providers; utilities and demand response enablers; lighting companies; and HVAC companies during the forecast period (2022-2027).

The ESPC market's growth will revolve around initiatives such as leveraging demand response, exploring new business models, and emphasis on healthy building accreditation from renowned agencies globally.

Product Code: PD6F-19

Strategic Imperatives

Why is it Increasingly Difficult to Grow?
The Strategic Imperative 8™
The Impact of the Top 3 Strategic Imperatives on the European Energy Savings and Performance Contracting (ESPC) Industry
Growth Opportunities Fuel the Growth Pipeline Engine™

Growth Opportunity Analysis

Scope of Analysis
Scope of Analysis (continued)
Market Segmentation
Market Segmentation (continued)
Market Segmentation (continued)
Market Segmentation (continued)
Market Segmentation (continued)
Key Competitors
Key Competitors (continued)
Global Energy Efficiency Investments
ESCO Investment in Energy Efficiency
Cost Benefit Analysis of ESPC Projects
Growth Metrics
Growth Drivers
Growth Restraints
Forecast Assumption
Revenue Forecast-Total Market
Revenue Forecast by Contract Type
Revenue Forecast Analysis by Total Market and Contract Type
Percent Revenue Forecast by Country
Revenue Forecast by Country/Region
Revenue Forecast Analysis by Country/Region
Revenue Forecast Analysis by Country/Region (continued)
Revenue Forecast by Building Component
Revenue Forecast Analysis by Building Component
Revenue Forecast by End User
Revenue Forecast Analysis by End User
Competitive Environment
Competitive Framework
Competitive Framework Analysis
Demand-side ESPC Service Players
Demand-side ESPC Service Players (continued)

Growth Opportunity Analysis by Country/Region

Revenue by Country/Region and Contract Type
Revenue by Country/Region and Building Component
Revenue by Country/Region and End User

Growth Opportunity Analysis: Germany

Growth Metrics
Revenue Forecast
Revenue Forecast Analysis
Revenue Forecast by Building Component
Revenue Forecast Analysis by Building Component
Revenue Forecast by End User
Revenue Forecast Analysis by End User
Competitive Environment

Growth Opportunity Analysis: France

Growth Metrics
Revenue Forecast
Revenue Forecast Analysis
Revenue Forecast by Building Component
Revenue Forecast Analysis by Building Component
Revenue Forecast by End User
Revenue Forecast Analysis by End User
Competitive Environment

Growth Opportunity Analysis: UK

Growth Metrics
Revenue Forecast
Revenue Forecast Analysis
Revenue Forecast by Building Component
Revenue Forecast Analysis by Building Component
Revenue Forecast by End User
Revenue Forecast Analysis by End User
Competitive Environment

Growth Opportunity Analysis: Italy

Growth Metrics
Revenue Forecast
Revenue Forecast Analysis
Revenue Forecast by Building Component
Revenue Forecast Analysis by Building Component
Revenue Forecast by End User
Revenue Forecast Analysis by End User
Competitive Environment

Growth Opportunity Analysis: Spain

Growth Metrics
Revenue Forecast
Revenue Forecast Analysis
Revenue Forecast by Building Component
Revenue Forecast Analysis by Building Component
Revenue Forecast by End User
Revenue Forecast Analysis by End User
Competitive Environment

Growth Opportunity Analysis: Nordic

Growth Metrics
Revenue Forecast
Revenue Forecast Analysis
Revenue Forecast by Building Component
Revenue Forecast Analysis by Building Component
Revenue Forecast by End User
Revenue Forecast Analysis by End User
Competitive Environment

Growth Opportunity Analysis: Benelux

Growth Metrics
Revenue Forecast
Revenue Forecast Analysis
Revenue Forecast by Building Component
Revenue Forecast Analysis by Building Component
Revenue Forecast by End User
Revenue Forecast Analysis by End User
Competitive Environment

Growth Opportunity Analysis: CEE

Growth Metrics
Revenue Forecast
Revenue Forecast Analysis
Revenue Forecast Analysis (continued)
Revenue Forecast by Building Component
Revenue Forecast Analysis by Building Component
Revenue Forecast by End User
Revenue Forecast Analysis by End User
Competitive Environment

Growth Opportunity Analysis: ROE

Growth Metrics
Revenue Forecast
Revenue Forecast Analysis
Revenue Forecast Analysis (continued)
Revenue Forecast by Building Component
Revenue Forecast Analysis by Building Component
Revenue Forecast by End User
Revenue Forecast Analysis by End User
Competitive Environment

Growth Opportunity Universe

Growth Opportunity 1: Digitalization, Demand Response, and Decarbonization for Optimum Building Energy Efficiency
Growth Opportunity 1: Digitalization, Demand Response, and Decarbonization for Optimum Building Energy Efficiency (continued)
Growth Opportunity 2: Innovative Business Models and Technologies in Energy Management Proposition
Growth Opportunity 2: Innovative Business Models and Technologies in Energy Management Proposition (continued)
Growth Opportunity 3: Efficiency-as-a-Service (EaaS) for Smaller Energy Performance and Savings Projects
Growth Opportunity 3: Efficiency-as-a-Service (EaaS) for Smaller Energy Performance and Savings Projects (continued)
Growth Opportunity 4: Building Energy Efficiency to Boost Healthy Buildings Certifications
Growth Opportunity 4: Building Energy Efficiency to Boost Healthy Buildings Certifications (continued)

Appendix

ESCO Associations in Europe

Next Steps

Your Next Steps
Why Frost, Why Now?
List of Exhibits
List of Exhibits (continued)
List of Exhibits (continued)
List of Exhibits (continued)
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