Energy as a Service (EaaS) Market Size & Share Analysis - Trends, Drivers, Competitive Landscape, and Forecasts (2024 - 2030)

Energy as a Service Market Size

EaaS Market Trends & Drivers

Rising Energy Consumption Is Key Factor for Market Expansion

Companies have realized the need to understand and analyze the pattern of their power usage through software, advanced integrated sensors, and smart meters, since consumption is rising rapidly across various industries. Similarly, with the high electricity consumption in the commercial sector, many technologies have been employed to produce power from renewable sources.

The demand for power and expenses on this commodity are driven by an expanding economy and infrastructure. The majority of the power is produced by burning fossil fuels, including coal and natural gas, as this is the most-affordable method. However, the increasing prices of fossil-based electricity, with the diminishing of their supply, will eventually result in the need for alternatives.

The majority of the electricity is produced by big power plants. Then, via a network of transmission and distribution lines and substations, this centrally generated utility is dispersed across the country or a state. The grid will evolve as DER technologies develop and their LCOE continues to decline. In the future, the power grid will be made up of a variety of small, decentralized microgrids, which will provide consumers with more control over their source of electricity and boost reliability.

The use of DERs, including onsite solar panels, combined heat and power, fuel cells, and batteries, has increased as a result of the power industry's transition away from traditional methods. The use of these distributed resources is also being driven by the growing need to reduce carbon emissions, develop low-cost technologies, and respond quickly to consumer needs, as well as the falling LCOE of these technologies. The EaaS ecosystem has benefited from the lower cost of DERs, and a number of utilities can reduce their customers' expenditures by switching from traditional to DERs.

Earlier, there was nothing a building owner could do to alter their overhead power expenses because utilities historically provided electricity at a rate based on the time of usage. However, this conventional approach has changed, and today, consumers have more control over their electricity expenses due to renewables, which are experiencing robust deployment rates, and efficiency improvements, coupled with the advent of high-capacity energy storage and distribution systems. EaaS combines various sources to fulfill the energy and sustainability goals of customers and guarantee services at a low annual cost.

EaaS Market Analysis

Commercial Sector Is Expected To Hold Larger Share

The commercial sector includes hospitals, educational institutions, information hubs, airports, and various other kinds of facilities. During the forecast period, the commercial sector, which also held the larger share in the past, will advance at the higher growth rate, of 11.1%.

A number of factors, including the rising population and changing climate, drive the expansion of the sector. Different commercial buildings have different power requirements, and the EaaS model supports commercial building owners with technical knowledge and limits their expenses on implementing green initiatives.

Due to Rapid Urbanization, Energy Supply Services Are Expected To Dominate Market

The market is expanding as a result of the high requirement for energy, due to the growing population. The growth in the count of advanced distribution infrastructure projects and the rate of urbanization have boosted the supply of power. The use of these services is cost-effective in the long run because the customer pays according to their actual electricity consumption, in tune with equipment performance measures, which immediately lowers operational costs.

Hence, the supply services category held the largest share, of 43%, in 2022, with the increasing number of government initiatives to promote renewable power and the surging necessity for cost control and energy conservation. Consumers are searching for reliable methods to get electricity without a grid, due to the increasing rates of this commodity.

Demand response management is essential in EaaS, as it schedules the operation of appliances to save expenditure, by taking into account both client convenience and the characteristics of electrical equipment. By transferring some demand from the peak to off-peak periods, the approach also improves the stability of electrical networks and lowers customers' utility spending.

Further, it is predicted that the optimization services category would expand at a significant rate, of 10.8%, throughout the forecast period. The rising number of government initiatives to promote renewable energy and resource conservation and the burgeoning need for controlling utility costs will favorably impact the expansion of the category in the upcoming years.

The energy industry is changing at pace, in part, due to the EaaS business model, which helps accelerate the adoption of low-carbon solutions. The climate catastrophe is driving energy companies to look for new and advanced approaches to supplying sustainable power in cities.

Regional Analysis

North America To Experience Significant Growth in Forecast Period

North American utilities are using digital technologies to comply with the new regulations, meet customers’ expectations, and achieve decarbonization. Thus, decarbonization decentralization, and digitization have been the key focus areas for utilities, in a bid to operationally and financially transform themselves. Therefore, the region's major utility providers are aiming to use the EaaS business model.

The capacity to incorporate DERs and analytics and offer personalized services to end users is one of the key factors supporting the EaaS business model. The building management technology advancements and the need of commercial and industrial consumers to lower their electricity spending and carbon emissions are the main drivers of this trend. EaaS also gives utility and service providers the chance to support, create, and offer solutions that help reduce the use of power, without compromising on productivity.

Furthermore, Europe's market benefits from the supportive government frameworks that encourage the implementation of green solutions and drive the setup of low-emission power generation systems in various locations. Currently, Germany, the U.K., and Italy are making significant contributions to the region's EaaS industry.

Additionally, the rising investments to upgrade and expand the grid infrastructure, to support the rising production of renewable energy, will propel the industry. The necessity to address the demand and supply gap, as well as the region's growing interest in clean energy, will boost the industry.

Market Breakdown

The report analyzes the impact of the major drivers and restraints on the EaaS market, to offer accurate market estimations for 2019–2030.

Based on Type

• Energy Supply Services
• Operational & Maintenance Services
• Energy Efficiency and Optimization Services

Based on End-User

• Commercial
• Industrial

Geographical Analysis

• North America
  • U.S.
  • Canada
• Europe
  • Germany
  •  U.K.
  •  France
  • Italy
  • Spain
• Asia-Pacific
  • Japan
  • China
  •  India
  • South Korea
  • Australia
• Latin America
  • Brazil
  • Mexico
• Middle East and Africa
  • Saudi Arabia
  •  South Africa
  •  U.A.E.

Top Energy as a Service Companies