The US energy service company (ESCO) market is expected to grow from $6.3 billion in 2015 to $11.5 billion in 2024, according to a new report from Navigant Research.
The solid 7.0 percent compound annual growth rate (CAGR) illustrates market recovery following the exhaustion of the American Recovery and Reinvestment Act (ARRA) stimulus funds that elevated the industry through the recession, finds the report “Energy Service Company Market Overview.”
ESCO revenue in Europe is projected to grow from $2.7 billion to $3.1 billion in 2024 at a 1.7 percent CAGR. ESCO market growth is expected to be driven by demand for capital to overcome the challenges of deferred maintenance, mounting regulatory and policy pressures, and growing interest in more comprehensive energy management strategies.
ESCOs in the United States have realized modest growth in revenue generated by the business of implementing comprehensive energy efficiency facility upgrades for the last 30 years. The ESCO business case has been formalized for a specific segment of customers with similar investment challenges and technical expertise requirements. In facing long-term business planning, ESCOs are challenged to grow their business in this mature marketplace, which has been dominated by business in the public and institutional segments. The evolution of this market is contingent on the continued support and development of the traditional customer base, as well as on the repositioning of offerings to appeal to a broader audience, namely in the private sector and Europe.