(EnergyIndustry.Net, July 22, 2022 ) According to a new market research report titled, “Smart Energy Management Market by Energy Source (Renewable, Non-Renewable), Offering, Function (Operation, Energy Management, Distribution, Storage, Grid Security), End User (Utility Providers, Consumers) and Geography - Global Forecasts to 2029”, the smart energy management market is expected to grow at a CAGR of 15% from 2022 to 2029 to reach $47.64 billion by 2029.
A smart energy management system (EMS) is a computer-based system used by operators of electric utility grids to monitor, control, and optimize the performance of the generation or transmission system. The system is designed to reduce energy consumption, improve the utilization of the system, increase reliability, & predict electrical system performance as well as optimize energy usage to reduce cost. Over the past two decades, energy management systems have emerged as a proven best practice methodology to ensure sustainable energy efficiency and improve performance across industries. Most industries that have implemented an EMS have achieved two to three times the annual energy savings achieved by industries without an EMS.
Rising energy demand and price volatility, increasing awareness about carbon footprint management, and growing inclination towards efficient energy management are the major factors driving the market growth. In addition, increasing investment in smart city projects and rising government investment in the modernization of aging infrastructure are expected to offer prominent growth opportunities for the growth of this market. However, the high cost associated with the replacement of existing infrastructure is expected to restrain the growth of this market. In addition, rising privacy & security concerns are also challenging the growth of the market.
Rising Energy Demand and Price Volatility to Drive the Smart Energy Management Market Growth
Global energy demand is increasing due to industrial activities and advances in developing and developed countries. According to the International Energy Agency, in 2021, global electricity demand surged, creating strains in major markets and pushing prices to unprecedented levels. After a drop in 2020, global electricity demand grew by 6% in 2021.
In addition, rising energy prices across countries is expected to provide opportunities for players operating in this market. For instance, electricity prices in European markets more than tripled in 2021 compared to 2020. The global surge in demand for energy could spark another three years of market volatility and record power plant pollution. Navigating this next normal will be a key challenge for utilities, traders, and large power consumers. Controlling and reducing the amount of energy use is important because it helps to reduce costs, risks, and carbon emissions. Proper utilization of smart energy management systems will help organizations of all sizes to manage their energy use sustainably, reduce price volatility, and meet growing energy demand. Thus, due to rising energy demand and price volatility, investment in low-carbon energy technologies and robust, smart electricity grids is increasing, which is expected to drive the SEM market.
To provide efficient analysis, Meticulous Research® has segmented this market based on energy source, offering, function, end user, and geography.
Based on energy source, the smart energy management market is broadly segmented into renewable and non-renewable/conventional. In 2022, the non-renewable/conventional segment is estimated to account for the largest share of the overall smart energy management market and is expected to grow at the highest CAGR during the forecast period. Factors such as increasing energy consumption across different end-use industries and rising adoption of energy management systems to reduce greenhouse gas emissions are expected to drive market growth.
Based on offering, the smart energy management market is segmented into solutions, software, and consulting & services. In 2022, the solutions segment is estimated to account for the largest share of the overall smart energy management market. Furthermore, the software segment is expected to grow at the highest CAGR during the forecast period. The segment's growth is attributed to the rising need to monitor energy system usage in facilities, saving businesses money on energy costs.
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Based on function, the smart energy management market is segmented into grid operation, renewable energy management, distributed energy management, energy storage, and grid security/cybersecurity. In 2022, the grid operation segment is estimated to account for the largest share of the overall smart energy management market and is expected to grow at the highest CAGR during the forecast period. The large share of this segment is attributed to the supportive regulatory framework of governments worldwide to promote the deployment of smart grids and ongoing smart city projects in developing countries.
Based on end user, the smart energy management market is segmented into energy utility providers and consumers. The consumers segment is further classified into residential, commercial, and industrial. The industrial segment is classified into manufacturing, construction, telecom & IT, government & public sector, healthcare, and other industrial end-users. In 2022, the consumers segment is expected to command the largest share of the global smart energy management market and is expected to grow at the highest CAGR during the forecast period. The large share of this segment is attributed to the increasing government initiatives and policies toward energy efficiency and the rising need to manage electricity demand to optimize energy consumption.
Based on geography, the global smart energy management market is segmented into five major geographies, namely, North America, Europe, Asia-Pacific, Latin America, and the Middle East & Africa. In 2022, North America is estimated to account for the largest share of the global smart energy management market. Government regulations for cost-saving and optimizing energy consumption and the growing inclination toward clean energy are the major factors contributing to the market's growth. In 2021, the U.S. Department of Energy (DOE) announced USD 61 million for ten pilot projects that will deploy modern technology to transform homes and workplaces into state-of-the-art, energy-efficient buildings.
The key players operating in the smart energy management market are Asea Brown Boveri (ABB) Ltd. (Switzerland), General Electric Company (U.S.), Honeywell International, Inc. (U.S.), Schneider Electric SE (France), Emerson Electric Co. (U.S.), Johnson Controls International Plc (Ireland), Cisco Systems, Inc. (U.S.), Siemens AG (Germany), Driivz Ltd. (Israel), Telit (U.K.), Tata Consultancy Services (TCS) (India), Robert Bosch GmbH (Germany), Panasonic Corporation (Japan), LG Electronics Inc. (South Korea), NEC Corporation (Japan), SAGE Automation (Australia), Vivint, Inc. (U.S.), Alarm.com (U.S.), Ecobee (Canada), and EcoFactor, Inc. (U.S.).
Renewable Solar Wind Others Non-renewable/Conventional
Smart Energy Management Market, by Offering
Solutions Smart Meters Data and Device Management PV Monitoring Smart Grid Power Electronics Devices Smart Energy Storage Communication Network Devices Other Solutions (Automatic Transfer Switch) Software Consulting & Services
Smart Energy Management Market, Function
Grid Operation Meter Data Management Grid Control, Management, & Monitoring Distribution Automation Microgrid Management Others (Smart Communication & Wide Area Monitoring) Renewable Energy Management Distributed Energy Management Energy Storage Grid Security/Cybersecurity
Smart Energy Management Market, End User
Energy Utility Providers Consumers Residential Commercial Industrial Manufacturing Construction Telecom and IT Government & Public Sector Healthcare Other Industrial End Users
Smart Energy Management Market, by Geography
North America U.S. Canada Europe Germany U.K. France Italy Spain Sweden Denmark Rest of Europe Asia-Pacific Japan China India South Korea Singapore Malaysia Australia & New Zealand Rest of Asia-Pacific Latin America Brazil Mexico Rest of Latin America Middle East and Africa UAE Israel Rest of MEA