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The global home energy management systems market size is estimated to grow by USD 1,625.57 million between 2022 and 2027 exhibiting a CAGR of 9.11%.
Home energy management systems are devices that are installed in residential buildings to enable the provision of feedback on electricity consumption patterns and power consumption data for individual appliances. The adoption of smart grid technologies such as remote terminal units, intelligent electronic devices, and other supervisory control and data acquisition systems is increasing. Smart meters provide real-time or near real-time energy consumption, enabling consumers to evaluate or know the areas of energy which is notably driving the market growth. The home energy management market is growing exponentially in key regions such as the US, the UK, and Canada. Additionally, customers are considering installing smart home products such as smart thermostats and smart lighting devices owing to comfortability and convenience. Giant market players such as Apple, Google, and Amazon, ZigBee are seizing the opportunity by launching new home energy management systems products which are compelling the market growth.
This report extensively covers market segmentation by Component (hardware, software, and services), Product (lighting controls, programmable thermostats, self-monitoring systems, and advanced central controllers), and Geography (North America, Europe, APAC, South America, and Middle East and Africa). It also includes an in-depth analysis of drivers, trends, and challenges. Furthermore, the report includes historic market data from 2017 to 2021.
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In 2020, the outbreak of COVID-19 spread implemented a nationwide lockdown. Hence, home energy management system hardware manufacturing units were closed, due to which supply chain operations were disrupted in the region. Owing to the imposition of lockdowns, vendors in the market had to shut down their production units. Furthermore, due to the pandemic, the demand for home energy management systems witnessed a decline from end-users which resulted in the slow growth of the market in the region. However, the market has been recovering since the second half of 2020. In 2021, the initiation of large-scale vaccination drives led to the lifting of lockdown restrictions and the resumption of operations in end-user industries, which increased the need for the home energy management systems globally.
Our researchers analyzed the data with 2022 as the base year, along with the key drivers, trends, and challenges. A holistic analysis of drivers will help companies refine their marketing strategies to gain a competitive advantage.
Key Home Energy Management Systems Market Driver
Due to the increasing global population and urbanization, there is a continuous rise in electricity generation, with utilities operating power plants at maximum capacity to generate the most power possible from the current infrastructure. This results in a simultaneous increase in power prices as power companies invest in T and D equipment, commodity prices, newer power resources, and geopolitical factors.
In 2019, the average monthly household expenditure on electricity bills in the US was USD 115.49, with the typical annual electricity usage for a residential utility customer being 886 kWh per month in 2021, according to the EIA. Louisiana had the highest annual electricity consumption per residential customer at 14,302 kWh, while Hawaii had the lowest at 6,369 kWh. To combat rising energy costs, energy conservation measures, such as home energy management systems, are being adopted which is driving the market growth.
Significant Home Energy Management Systems Market Trend
The smart home trend is rapidly gaining popularity among consumers who desire to enhance domestic convenience through electronic devices. This progressive development in the residential real estate sector aims to make living more comfortable, convenient, secure, entertaining, and sustainable. Nowadays, smart home technologies equipped with advanced sensors are affordable and can be used by the average household to connect appliances such as heating modules, lighting systems, air conditioning units, computers, television sets, entertainment systems, security devices, and camera systems. Homeowners can control these devices through their smartphones and tablets, and home appliances can utilize artificial intelligence to predict consumer preferences accurately based on historical data.
The surge in demand for smart homes is attributed to the growing number of working couples with dual incomes worldwide. With both partners working, the financial capacity to own a smart home is increased. The smart home market is most prevalent in North America and Europe, with developing economies in APAC, such as India, China, and Singapore, also adopting the concept. In India, Godrej Interio of the Godrej Group is developing connected homes, but they believe that it may take a few years for the concept to gain momentum in the country.
Major Home Energy Management Systems Market challenge
The home energy management system market is facing a significant challenge in terms of the potential invasion of privacy. To function effectively, the system of devices must remain connected to a communication network, which exposes them to the risk of being hacked and personal information being stolen. With the increase in the number of connected devices worldwide due to home energy management system technology, all Wi-Fi-enabled devices are now operated using cloud technology, which raises privacy concerns. For individuals focusing on the security aspect when adopting any new technology regarding smart homes, unauthorized access to cloud information could result in cyber threats, compromising the integrity of the entire system.
When a smart meter is installed, it acts as a gateway between the house and the grid, enabling remote access to control the HVAC system, charge electric vehicles, and shift energy-intensive activities to off-peak hours. However, performing these functions over a communication network raises security concerns. The grid is susceptible to new threats that could jeopardize its integrity and block energy access to the house. These security and privacy concerns may negatively impact the adoption of home energy management systems, potentially affecting the market during the forecast period.
Key Home Energy Management Systems Market Customer Landscape
The report includes the adoption lifecycle of the market, covering from the innovator’s stage to the laggard’s stage. It focuses on adoption rates in different regions based on penetration. Furthermore, the report also includes key purchase criteria and drivers of price sensitivity to help companies evaluate and develop their growth strategies.
Global Home Energy Management Systems Market Customer Landscape
Vendors are implementing various strategies, such as strategic alliances, partnerships, mergers and acquisitions, geographical expansion, and product/service launches, to enhance their presence in the market.
Tado GmbH - The company offers home energy management systems that include features that empower full-control to homeowners to set their monthly heating costs, and stick within budget. The company offers intelligent climate control for private households, small businesses, and shops.
The report also includes detailed analyses of the competitive landscape of the market and information about 15 market vendors, including:
Qualitative and quantitative analysis of vendors has been conducted to help clients understand the wider business environment as well as the strengths and weaknesses of key market players. Data is qualitatively analyzed to categorize vendors as pure play, category-focused, industry-focused, and diversified; it is quantitatively analyzed to categorize vendors as dominant, leading, strong, tentative, and weak.
The hardware segment was valued at USD 865.06 million in 2017 and continued to grow until 2021. The hardware of a home energy management system typically consists of a hub device that relays communications between events occurring inside the home, the user, and occasionally the neighborhood utility or electricity retailer. Hardware components may boost the home energy management system market during the forecast period as monitoring and controlling building operations gain traction to embed intelligence. Data and communications going in and coming out of a home energy management system are moderated by the software used there. The software, as seen from the user's perspective, serves as the interface for accessing system monitoring data and control features. The software may gain traction as more businesses evaluate the importance of energy efficiency and seek to improve collaboration and communication regarding energy-related issues. Hence, owing to these factors, the market is expected to witness growth during the forecast period. The services segment is gaining popularity in the home energy management system market which is driving market growth.
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The lighting controls segment in the global home energy management system market is expected to grow rapidly during the forecast period. The market for lighting control systems is driven by declining prices of lighting control devices; increased focus on energy-efficient lighting systems; and increased awareness of energy conservation among consumers, governments, and businesses. Home heating and cooling account for one of the largest power-intensive activities in the residential sector, thus making smart thermostats one of the most important elements in the home energy management system. These devices can be pre-programmed, and the temperature can be set for various times of the day. They can be automatically turned off or on, depending on the location of the user using the geofencing capability. Increased focus on safety and security is driving the self-monitoring systems segment. The legacy of services and systems provided by professional service providers is being replaced by plug-and-play products that can be installed by the user and monitored remotely using smartphones. The advanced central controller is the main component of the home energy management system. It is a single device that is connected and programmed to work with other components of the system to effectively control energy use which is gaining attraction and in turn adding to the growth of the market.
North America is estimated to contribute 34% to the growth of the global market during the forecast period. Technavio’s analysts have elaborately explained the regional trends and drivers that shape the market during the forecast period.
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North America is the largest regional contributor to the global home energy management systems market. The increasing energy prices and the rising focus on demand response and energy efficiency to decrease electricity costs have made energy management products a compelling proposition. The US is the largest revenue contributor in the region. This is mainly driven by the increased awareness about energy efficiency and products that can help in achieving it, combined with rising income levels, which are leading to the higher adoption of home energy management systems. The US is one of the largest markets for home energy management systems. The adoption of home energy management systems has increased in the country due to high-income levels and increased awareness about the benefits of these systems. With added functionalities of battery storage in homes, energy management has become more flexible in the country.
The report forecasts market growth by revenue at global, regional & country levels and provides an analysis of the latest trends and growth opportunities from 2017 to 2027.
Home Energy Management Systems Market Scope |
|
Report Coverage |
Details |
Page number |
183 |
Base year |
2022 |
Historic period |
2017-2021 |
Forecast period |
2023-2027 |
Growth momentum & CAGR |
Accelerate at a CAGR of 9.11% |
Market growth 2023-2027 |
USD 1,625.57 million |
Market structure |
Fragmented |
YoY growth 2022-2023(%) |
8.4 |
Regional analysis |
North America, Europe, APAC, South America, and Middle East and Africa |
Performing market contribution |
North America at 34% |
Key countries |
US, China, Germany, UK, and France |
Competitive landscape |
Leading Vendors, Market Positioning of Vendors, Competitive Strategies, and Industry Risks |
Key companies profiled |
Capgemini Service SAS, Carrier Global Corp., Cisco Systems Inc., Comcast Corp., ecobee, Emerson Electric Co., General Electric Co., Honeywell International Inc., Intel Corp., Johnson Controls International Plc., Lennox International Inc., Liricco Technologies Ltd., Panasonic Holdings Corp., Resideo Technologies Inc., Robert Bosch GmbH, Schneider Electric SE, Siemens AG, Snap One LLC, tado GmbH, and Vivint Smart Home Inc. |
Market dynamics |
Parent market analysis, Market growth inducers and obstacles, Fast-growing and slow-growing segment analysis, COVID 19 impact and recovery analysis and future consumer dynamics, Market condition analysis for forecast period |
Customization purview |
If our report has not included the data that you are looking for, you can reach out to our analysts and get segments customized. |
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1 Executive Summary
2 Market Landscape
3 Market Sizing
4 Historic Market Size
5 Five Forces Analysis
6 Market Segmentation by Component
7 Market Segmentation by Product
8 Customer Landscape
9 Geographic Landscape
10 Drivers, Challenges, and Trends
11 Vendor Landscape
12 Vendor Analysis
13 Appendix
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