Political ambition on climate change and rising energy costs are creating growing demand for energy efficiency services (EES). By 2025, the size of the EU's market is set to almost double to some EUR 50 billion. But there is little transparency in the market, which makes it difficult for EES providers to see what their options are. Roland Berger therefore decided to analyze the different market segments and growth drivers and was able to come up with a set of useful recommendations for new market entrants and industry incumbents alike.
Energy efficiency services help companies apply new technologies and other measures to make more efficient use of the energy they consume, thus resulting in both lower consumption and lower costs. There are five lead markets for EES providers to operate in. These are: energy efficiency management software – this is the fastest growing market with 14 percent growth p.a.; energy efficiency audit/consulting (4% growth p.a.); engineering, procurement and construction (EPC) of energy efficiency technology (9%); efficient operations (8%); and energy efficiency contracting (8%).
Five main factors drive the growth of the market: regulation, often in the form of national and international climate change agreements; innovation in areas such as new energy-saving production technologies; the energy transition; an increasing focus on sustainability at both the political and business level; and digitalization, which is one of the biggest drivers given its capacity as an optimization enabler.
These five drivers impact the five EES lead markets to varying degrees. Added to that, the overall market is largely populated by small and medium-sized companies, many of whom specialize exclusively in EES while others have a different main focus.
The market is fragmented and complex, as well as being highly dynamic and very competitive. Depending on their individual situation, both new players and market incumbents are faced with a great many opportunities but also certain challenges as a result. Smart strategies are therefore essential when it comes to choosing the right business model and ensuring growth – as well as deciding on the best organizational setup to achieve it.
A Roland Berger study analyzed the market for energy efficiency services in Europe and found that it will almost double in size by 2025. This offers opportunities and challenges for companies active in the sector as well as new market entrants.
