Revenue from building energy management systems (BEMS) is expected to reach $2.4 billion in 2015 and grow to $10.8 billion by 2024, according to a new report from Navigant Research. Although North America and Europe are projected to continue leading BEMS demand in the near term, Navigant projects increasing investment in Asia Pacific in the mid- and long-term timeframes.
Over the last 10 years, the BEMS industry has evolved, and the market has continued to mature, according the report, Building Energy Management Systems. Research indicates there will be significant momentum in investment through 2024.
Across customer segments, the economic impacts of BEMS continue to dominate the decision-making process. In some regions, there are also regulatory pressures that incentivize investment in BEMS.
In the Asia Pacific region, for example, national climate change policies are beginning to solidify energy management mandates and set specific goals for energy efficiency in the building sector, and building performance is a critical component for meeting energy efficiency goals. BEMS adoption in rapidly urbanizing cities in emerging nations such as India face different challenges and barriers than in the West, but research suggests a growing rate of adoption in the mid- and long-term.
Other areas where policy will impact the growth of BEMS are the European Union (EU) and the United States.
The EU announced the Energy Performance of Buildings Directive (EPBD) in 2010 and the Energy Efficiency Directive (EED) in 2012. These became the two primary mechanisms for mandating energy efficiency in the buildings segment. BEMS are valuable tools for building owners facing new energy management requirements under the EPBD. The EED mandates the development of national energy efficiency action plans and retrofits of government-owned facilities as demonstrations of leadership.
In the United States, the US Environmental Protection Agency’s (EPA’s) Clean Power Plan and the concern over customer satisfaction play a role in utility interest in BEMS. Vendors are providing new BEMS solutions directly to utilities for customer engagement in demand-side management (DSM) and, more recently, improved customer satisfaction. From the vendor’s perspective, the utilities are a difficult customer to reach due to cost constraints and purchase cycles, but Navigant Research analysis suggests that utility demand for BEMS will increase over the mid- and long-term.