Energy Efficiency and Conservation Market Research Reports

From Policy to Practice: Navigating the Global Landscape of Energy Conservation

Industry Overview

The energy efficiency and conservation sector has been experiencing growth as a result of technological advancements, government policies, and heightened environmental awareness. In 2023, the global energy efficiency market was estimated to be worth an estimated $270 billion. It is anticipated to expand at a compound annual growth rate (CAGR) of 8-10% until 2024. Stringent regulatory standards, rising energy costs, and increasing investments in sustainable energy solutions are the primary factors driving this growth. Governments worldwide are implementing robust policies to encourage energy efficiency. The Energy Efficiency Directive in the European Union is designed to enhance energy efficiency by 32.5% by 2030. The U.S. Department of Energy (DOE) is committed to the enforcement and expansion of standards in the industrial, building, and appliance sectors. The 14th Five-Year Plan in China incorporates bold energy-saving objectives, with the primary objective of decreasing energy intensity by 13.5% by 2025. 

The energy efficiency sector is transforming as a result of the Internet of Things (IoT) and smart technology. Smart meters, advanced building management systems, and AI-driven energy management solutions are increasingly prevalent. It is anticipated that by 2024, more than one billion smart meters will have been implemented worldwide, enabling the monitoring and management of energy in real time. Energy efficiency improvements are a significant concentration in the building sector, which is responsible for approximately 40% of global energy consumption. Up to 50% of energy consumption can be reduced by retrofitting existing buildings with energy-efficient technologies, including LED lighting, high-efficiency HVAC systems, and enhanced insulation. Investments in energy-efficient building technologies surpassed $100 billion in 2023 and are expected to continue to increase consistently. Industries are implementing energy-efficient practices to comply with regulatory requirements and reduce operational costs. 

About $70 billion was the estimated value of the global market for industrial energy efficiency solutions in 2023, which encompassed energy-efficient motors, boilers, and process controllers. As industries endeavor to achieve carbon neutrality and sustainability, this market is anticipated to grow. Additionally, there are substantial developments in the transportation sector. Global EV sales exceeded 10 million units in 2023, representing a 35% increase from 2022, as electric vehicle (EV) adoption is surging. Governments are investing in EV infrastructure and offering incentives, with projections suggesting that EVs could account for 25% of new car sales by 2024. The global solar power capacity reached one terawatt (TW) in 2023, while the wind power capacity was 850 gigawatts (GW). In addition, the global energy storage market is anticipated to expand from $12 billion in 2023 to $19 billion by 2024 as energy storage solutions are being developed to mitigate the intermittency of renewable systems.

Details for top 10 countries

United States

The energy efficiency and conservation sector in the United States was projected to grow at an 8% rate through 2024, with a value of approximately $85 billion in 2023. Stringent regulatory standards, substantial government incentives, and a robust emphasis on sustainable energy practices are the primary factors driving this expansion. The U.S. Department of Energy (DOE) is instrumental in the enforcement and expansion of standards in the industrial, building, and appliance sectors. Approximately 40% of the sector's investments are allocated to the building sector, which is the largest consumer of energy efficiency solutions. A significant emphasis has been placed on the retrofitting of existing buildings with energy-efficient technologies, including high-efficiency HVAC systems, LED illumination, and enhanced insulation. Energy efficiency measures are also considerably implemented in the industrial sector, which encompasses heavy industries and manufacturing, to mitigate operational expenses and satisfy regulatory obligations. The transportation sector is another critical area, as the adoption of electric vehicle (EV) has experienced a significant increase, with EV sales in the United States surpassing 1.5 million units in 2023, a 25% increase from 2022. The United States is a leader in the global energy efficiency market, as evidenced by its approximately 30% market share. Substantial investments in solar and wind power are also essential for the integration of renewable energy. The U.S. solar power capacity is anticipated to reach 150 gigawatts (GW) by 2024, while the wind power capacity is anticipated to reach 130 GW.

China

In 2023, the energy efficiency and conservation sector in China was estimated to be worth $75 billion, with a projected growth rate of 10% through 2024. Through its 14th Five-Year Plan, the Chinese government has been actively advocating for energy efficiency. This plan specifies a 13.5% reduction in energy intensity by 2025. In China, the industrial sector is the primary consumer of energy efficiency solutions due to the country's extensive manufacturing base. Energy-efficient boilers, actuators, and process controls are currently receiving substantial investments. The government is also advocating for energy-efficient building designs and retrofits, with the building sector being a significant focus. In 2023, the transportation sector sold more than 4 million electric vehicles (EVs), a 40% increase from the previous year. The transport sector is rapidly incorporating EVs. China's substantial investments and regulatory initiatives in this field have resulted in approximately 25% of the global energy efficiency market share. Another critical component is the incorporation of renewable energy sources, with China being the leader in the installation of solar and wind power. The solar power capacity of China is anticipated to reach 350 GW by 2024, while the wind power capacity is anticipated to reach 310 GW.

Germany

In 2023, the energy efficiency and conservation sector in Germany was estimated to be worth $45 billion, with a projected growth rate of 7% through 2024. Stringent regulations and a steadfast dedication to the Energiewende (energy transition) policy have propelled the nation to become a leader in energy efficiency. The building sector is the primary consumer of energy efficiency solutions, with an emphasis on the retrofitting of existing structures and the implementation of advanced energy management systems. Additionally, the industrial sector makes substantial investments in energy-efficient technologies to mitigate emissions and expenses. The transportation sector, particularly the adoption of electric vehicles, is expanding, with a 30% increase from 2022 to 2023, with the sale of over 800,000 EVs. Germany accounts for approximately 10% of the global energy efficiency market. Additionally, the nation is a pioneer in the integration of renewable energy sources, having made substantial investments in wind and solar power. Germany is anticipated to achieve a solar power capacity of 70 GW and a wind power capacity of 60 GW by 2024.

Japan

In 2023, the energy efficiency and conservation sector in Japan was estimated to be worth $40 billion, with a projected growth rate of 6% through 2024. The country's dedication to reducing greenhouse gas emissions and its limited natural resources have resulted in a strong emphasis on energy efficiency. The industrial sector in Japan is the largest consumer of energy efficiency solutions, with substantial investments in energy-efficient manufacturing processes and technologies. The building sector is also a critical area, with an emphasis on energy-efficient building designs and retrofits. The adoption of electric vehicles is on the rise in the transportation sector, with a 20% increase from the previous year, with more than 600,000 EVs sold in 2023. approximately 8% of the global energy efficiency market share is held by Japan. The nation is also making investments in renewable energy, with the capacity of solar and wind power expected to reach 50 GW and 30 GW, respectively, by 2024.

United Kingdom

In 2023, the energy efficiency and conservation sector in the United Kingdom was estimated to be worth $35 billion, with a projected growth rate of 7% through 2024. The Energy Company Obligation (ECO) and the Green Deal are among the policies that the UK government has implemented to encourage energy efficiency. The building sector is the primary consumer of energy efficiency solutions, with an emphasis on the retrofitting of existing buildings and the enhancement of insulation and heating systems. Additionally, the industrial sector makes substantial investments in energy-efficient technologies to mitigate emissions and operational expenses. With a 25% increase from 2022, the transportation sector is rapidly implementing electric vehicles, with more than 500,000 EVs sold in 2023. The United Kingdom accounts for approximately 6% of the global energy efficiency market share. The nation is also a pioneer in the integration of renewable energy, having made substantial investments in offshore wind power. The UK's offshore wind power capacity is anticipated to reach 30 GW by 2024.

France

In 2023, the energy efficiency and conservation sector in France was estimated to be worth $30 billion, with a projected growth rate of 6% through 2024. The Energy Transition for Green Growth Act is one of the numerous policies that the French government has implemented to promote energy efficiency. The building sector is the primary consumer of energy efficiency solutions, with an emphasis on the retrofitting of existing buildings and the implementation of advanced energy management systems. Additionally, the industrial sector makes substantial investments in energy-efficient technologies to mitigate emissions and expenses. The adoption of electric vehicles is on the rise in the transportation sector, with a 20% increase from the previous year, with more than 400,000 EVs sold in 2023. It is estimated that France accounts for approximately 5% of the global energy efficiency market. Additionally, the nation is making investments in renewable energy, with the capacity of solar and wind power expected to reach 40 GW and 25 GW, respectively, by 2024.

Canada

In 2023, the energy efficiency and conservation sector in Canada was estimated to be worth $25 billion, with a projected growth rate of 7% through 2024. The Pan-Canadian Framework on Clean Growth and Climate Change is one of the numerous policies that the Canadian government has implemented to promote energy efficiency. The building sector is the primary consumer of energy efficiency solutions, with an emphasis on the retrofitting of existing buildings and the enhancement of insulation and heating systems. Additionally, the industrial sector makes substantial investments in energy-efficient technologies to mitigate emissions and operational expenses. Electric vehicles are being rapidly adopted by the transportation sector, with a 30% increase from 2022 to 2023, resulting in the sale of more than 300,000 EVs. Approximately 4% of the global energy efficiency market share is occupied by Canada. Additionally, the nation is a pioneer in the integration of renewable energy sources, having made substantial investments in solar, wind, and hydropower. The renewable energy capacity of Canada is anticipated to achieve 120 GW by 2024. The energy efficiency market in Canada is distinguished by a strong commitment to reducing carbon emissions, significant investments in renewable energy, and robust government policies.

South Korea

In 2023, the energy efficiency and conservation sector in South Korea was estimated to be worth $20 billion, with a projected growth rate of 8% through 2024. The Energy Use Rationalization Act is one of the policies that the South Korean government has implemented to promote energy efficiency. The industrial sector is the largest consumer of energy efficiency solutions, with substantial investments in energy-efficient manufacturing processes and technologies. The building sector is also a critical area, with an emphasis on energy-efficient building designs and retrofits. In 2023, the number of electric vehicles sold exceeded 200,000, representing a 25% increase from the previous year, and the transportation sector is experiencing an increase in the adoption of these vehicles. Approximately 3% of the global energy efficiency market is occupied by South Korea. Additionally, the nation is making investments in renewable energy, with the capacity of solar and wind power expected to reach 30 GW and 20 GW, respectively, by 2024.

Italy

In 2023, the energy efficiency and conservation sector in Italy was estimated to be worth $18 billion, with a projected growth rate of 7% through 2024. The National Energy Efficiency Action Plan is one of the numerous policies that the Italian government has implemented to encourage energy efficiency. The building sector is the primary consumer of energy efficiency solutions, with an emphasis on the retrofitting of existing buildings and the enhancement of insulation and heating systems. Additionally, the industrial sector makes substantial investments in energy-efficient technologies to mitigate emissions and operational expenses. A 20% increase from 2022, the transportation sector is rapidly implementing electric vehicles, with more than 150,000 EVs sold in 2023. Italy accounts for approximately 3% of the global energy efficiency market share. The nation is also making investments in renewable energy, with the capacity of solar and wind power expected to reach 25 GW and 15 GW, respectively, by 2024. Italy's energy efficiency market is distinguished by a strong commitment to reducing carbon emissions, significant investments in renewable energy, and robust government policies. Government incentives and the European Union's rigorous energy efficiency objectives are particularly motivating the building sector to undertake substantial retrofitting initiatives.

India

In 2023, the energy efficiency and conservation sector in India was estimated to be worth $20 billion, with a projected growth rate of 10% through 2024. The Perform, Achieve, and Trade (PAT) scheme and the National Mission for Enhanced Energy Efficiency (NMEEE) are among the numerous initiatives of the Indian government that have been implemented to promote energy efficiency. The industrial sector is the primary consumer of energy efficiency solutions, as it is motivated by the necessity to enhance operational efficiency and decrease energy consumption. Initiatives to enhance energy efficiency in residential and commercial structures are also a significant focus in the building sector. The adoption of electric vehicles is expanding rapidly in the transportation sector, with a 50% increase from the previous year, resulting in the sale of more than one million EVs in 2023. India occupies approximately 4% of the global energy efficiency market. Additionally, the nation is making substantial investments in renewable energy, with the expectation that solar power capacity will surpass 100 GW and wind power capacity will surpass 60 GW by 2024.

PESTEL Analysis

Political

The political landscape substantially impacts the energy efficiency and conservation sector. Government policies and regulations significantly influence the market dynamics. Many countries have implemented strict energy efficiency standards and conservation mandates in recent years to mitigate greenhouse gas emissions and combat climate change. For instance, the Paris Agreement has incited a number of nations to pledge to decrease their carbon footprints, thereby stimulating investments in energy-efficient technologies and practices. Governments provide subsidies, tax incentives, and grants to motivate households and businesses to implement energy-efficient solutions. For example, the United States provides a variety of federal and state-level incentives to encourage the installation of renewable energy sources and the enhancement of energy-efficient homes. The European Union's Green Deal is designed to achieve climate neutrality in Europe by 2050 by making substantial investments in renewable energy initiatives and energy efficiency. By promoting innovation and reducing financial barriers, these policies foster a favorable environment for the sector's growth. Nevertheless, policy changes that may affect the sector may result from political instability and changes in government. For example, the United States has experienced the rollback of environmental regulations during various presidential terms, as evidenced by changes in administration.

Economical

Economic factors significantly influence the energy efficiency and conservation sector's growth and development. In 2023, the global market for energy efficiency solutions was estimated to be worth $320 billion and is anticipated to expand at a compound annual growth rate (CAGR) of 8% through 2024. Both businesses and consumers are motivated to invest in energy-efficient technologies and practices by economic incentives, such as cost savings on energy expenses. Over time, substantial cost reductions are achieved through energy efficiency enhancements. By retrofitting buildings with energy-efficient heating, ventilation, and lighting systems, it is possible to decrease energy consumption by as much as 30%. Energy efficiency also benefits industrial sectors by reducing operational costs and improving competitiveness. These investments are frequently financially viable due to the support of governments and financial institutions through subsidies, grants, and low-interest loans. The creation of jobs is a significant economic consequence of the energy efficiency sector. The sector is a significant employer, providing millions of employment worldwide in fields including manufacturing, installation, maintenance, and energy auditing.

Social

In the energy efficiency and conservation sector, social factors are instrumental in determining consumer behavior, public perception, and societal demand for sustainable practices. The growing societal emphasis on energy efficiency and conservation is a result of the increasing awareness of environmental issues and the impacts of climate change. Public awareness campaigns and educational initiatives have significantly influenced the adoption of energy-efficient technologies. Private companies, non-profit organizations, and governments have implemented numerous initiatives to educate the public on the advantages of energy efficiency, including enhanced health outcomes, reduced carbon footprints, and cost savings. For instance, the ENERGY STAR program of the U.S. Environmental Protection Agency (EPA) assists consumers in identifying energy-efficient appliances and practices, thereby facilitating substantial energy savings across the country. The societal movement toward sustainability has also influenced corporate strategies. Companies are progressively incorporating energy-efficient practices into their corporate social responsibility (CSR) initiatives. In addition to satisfying the increasing demand from environmentally conscious consumers and investors, this also improves their public image. Businesses that prioritize energy efficiency can attract a more loyal customer base and access green financing options, which can further drive sector growth.

Technological

The energy efficiency and conservation sector is fundamentally driven by technological advancements, which promote innovation, efficiency, and the adoption of sustainable practices. The capacity to reduce energy consumption and improve overall energy efficiency across a variety of sectors has been considerably improved by the rapid development and deployment of new technologies. Energy management has been transformed by the Internet of Things (IoT) and smart technology. Real-time monitoring and control of energy consumption are made possible by smart meters, sensors, and connected devices, which enable consumers and businesses to optimize their energy consumption. This can result in substantial energy savings, as smart thermostats are capable of learning user preferences and autonomously adjusting heating and cooling systems. The increasing adoption of these technologies was underscored by the global sales of smart home devices, which exceeded 1.4 billion units in 2023. Developments in materials science have resulted in the creation of more energy-efficient insulation materials, windows, and building components, thereby substantially decreasing energy loss in buildings. The integration of energy storage systems with renewable energy sources, such as wind turbines and solar panels, has further improved energy efficiency.

Environmental

The energy efficiency and conservation sector is primarily driven by environmental factors as the necessity to reduce environmental impact and mitigate climate change becomes more pressing. The global initiative to mitigate greenhouse gas emissions, preserve natural resources, and advance sustainable development is the primary driver of the sector's expansion. The energy efficiency and conservation sector is essential in the fight against climate change, as it reduces energy consumption and the corresponding carbon emissions. The carbon footprint of buildings, industrial processes, and transportation can be substantially reduced through the implementation of energy-efficient technologies and practices. For instance, retrofitting buildings with energy-efficient lighting, insulation, and HVAC systems can result in a 30% reduction in energy consumption, which in turn leads to significant reductions in CO2 emissions. Another critical component is the integration of renewable energy. It is imperative to transition to renewable energy sources, including hydropower, wind, and solar, in order to mitigate environmental degradation and reduce dependence on fossil fuels. In 2023, the global renewable energy capacity reached 3,372 gigawatts (GW), with solar and wind energy comprising the preponderance of new installations. Renewable energy is enhanced by energy efficiency measures, which optimize energy consumption and decrease overall demand. The energy efficiency sector is increasingly incorporating the circular economy principles to promote waste reduction and resource efficiency.

Legal

The energy efficiency and conservation sector is substantially influenced by legal factors, which affect the regulatory frameworks, standards, and compliance requirements that govern industry practices. To ensure public safety, mitigate environmental impacts, and promote energy efficiency, governments worldwide implement laws and regulations. Common regulatory measures that are designed to encourage the adoption of energy-efficient technologies and products include energy efficiency standards and labeling requirements. Appliance energy efficiency standards in the United States, for instance, establish minimum efficiency levels for appliances, including refrigerators, air conditioners, and laundry machines. The information contained in energy labels enables consumers to make informed purchasing decisions by providing them with information regarding the energy performance of products. Additionally, the sector is significantly influenced by building codes and regulations. Governments implement energy regulations to establish minimum efficiency standards for new construction and significant renovations. Compliance with these codes guarantees that buildings are constructed and designed in a manner that reduces greenhouse gas emissions and energy consumption. Energy-efficient building practices are further encouraged by the implementation of green building certification programs, including LEED (Leadership in Energy and Environmental Design).

Major companies and their details

Siemens AG

Siemens AG, a global leader in electronics and electrical engineering, generated revenues of approximately $100 billion in 2023. The energy efficiency and conservation sector accounted for approximately 15% of the company's revenue. Siemens' research and development initiatives are substantial, with an annual investment of approximately $6 billion. A substantial portion of this investment is allocated to the advancement of energy efficiency technologies. The company's revenue from energy efficiency and conservation is expected to increase by 10% by 2024 as a result of the robust demand in a variety of sectors. Siemens operates through a variety of business segments, such as Siemens Healthineers, Smart Infrastructure, Mobility, and Digital Industries. The company's energy efficiency and conservation initiatives are primarily overseen by the Smart Infrastructure segment. Intelligent building solutions, decentralized energy systems, and smart infrastructures are the primary focus of this segment. Innovative grid technologies to optimize energy distribution, as well as advanced building management systems, energy-efficient lighting, and HVAC solutions, are among Siemens' offerings in this sector. With an estimated market share of approximately 12%, the organization occupies a prominent position in the global energy efficiency market. Siemens' global reach and extensive portfolio allow it to serve a diverse array of industries, such as industrial manufacturing, public infrastructure, and commercial structures.

Johnson Controls International plc

In 2023, Johnson Controls International plc, a worldwide leader in building technologies and solutions, generated revenues of approximately $25 billion, with approximately 20% of this revenue coming from its energy efficiency and conservation segment. The company allocates approximately $1.5 billion annually to the development of innovative energy solutions, demonstrating its substantial investment in research and development. It is anticipated that this emphasis on innovation will result in a 7% increase in revenue in the energy efficiency segment by 2024. The company's primary business segments are Global Products, Building Solutions North America, Building Solutions EMEA/LA, and Building Solutions Asia Pacific. The Building Solutions segments, notably in North America and EMEA, are essential to their energy efficiency initiatives. Johnson Controls provides a comprehensive selection of energy-efficient products and services, such as energy performance contracting, HVAC equipment, and building management systems. Johnson Controls is estimated to possess a substantial portion of the global energy efficiency market, which is approximately 8%.

Schneider Electric SE

In 2023, Schneider Electric SE, a global leader in energy management and automation, generated revenues of approximately $35 billion, with approximately 30% of this revenue coming from its energy efficiency and conservation segment. The company allocates a substantial portion of its $2 billion annual R&D budget to the development of innovative energy solutions. Schneider Electric's revenue from this segment is expected to increase by 9% by 2024, which is indicative of the robust market demand. Energy Management, Industrial Automation, and Services comprise the organization's principal business segments. Their energy efficiency and conservation initiatives are fundamentally centered around the Energy Management segment. Schneider Electric provides a diverse selection of products and solutions, such as energy management systems, advanced metering infrastructure, and smart grid technologies. Their EcoStruxure platform optimizes energy efficiency in a variety of applications by integrating AI and IoT. Schneider Electric is estimated to hold a substantial percentage of the global energy efficiency market, approximately 10%. The company's solutions are extensively implemented in various sectors, including commercial and residential structures, data centers, industrial facilities, and utilities.

Honeywell International Inc.

In 2023, Honeywell International Inc., a diversified technology and manufacturing leader, reported revenues of approximately $37 billion, with approximately 18% of this revenue attributed to its energy efficiency and conservation sector. Honeywell spends approximately $1.5 billion annually on research and development, with an emphasis on energy efficiency technologies. It is anticipated that the company's revenue from this segment will increase by 8% by 2024. Honeywell is organized into four primary business segments: Aerospace, Honeywell Building Technologies (HBT), Performance Materials and Technologies (PMT), and Safety and Productivity Solutions (SPS). The HBT segment is essential to their energy efficiency initiatives, providing products and solutions for smart grid applications, energy management, and building automation. Honeywell's product line encompasses energy-efficient lighting, advanced HVAC systems, and building management software. Honeywell is a prominent player in the global energy efficiency market, with an estimated 7% market share. Their comprehensive solutions for residential applications, industrial operations, and commercial buildings assist customers in enhancing sustainability and reducing energy consumption.

ABB Ltd.

In 2023, ABB Ltd., a global leader in power and automation technologies, reported revenues of approximately $30 billion, with approximately 25% of this revenue derived from its energy efficiency and conservation segment. ABB allocates approximately $1.4 billion annually to research and development, with an emphasis on the creation of sophisticated energy solutions. It is anticipated that the company's revenue from this segment will increase by 9% by 2024. Electrification, Industrial Automation, Motion, and Robotics & Discrete Automation comprise ABB's principal business segments. The Electrification segment is at the vanguard of their energy efficiency initiatives, providing a diverse selection of products and solutions, such as energy-efficient drives, smart grids, and advanced control systems. ABB's solutions are instrumental in the optimization of energy consumption in a variety of applications, including industrial processes and urban infrastructure. ABB is estimated to possess a substantial portion of the global energy efficiency market, approximately 9%. The company's global presence and innovative technologies allow it to provide services to a wide variety of industries, such as manufacturing, utilities, transportation, and building automation.

Recent developments

• Siemens inaugurated a new demonstration facility in May 2023 that specializes in the customization of efficient electrification and automation technologies for the mining sector. This offers an immersive demonstration of Siemens technologies that are specifically designed for mine optimization. Siemens is a German multinational technology company conglomerate that concentrates on a variety of sectors, such as infrastructure, healthcare, transportation, and industry.

Conclusion
In 2023 and 2024, there was a lot of change and expansion in the energy conservation and efficiency industry. Rising environmental consciousness, new technologies, and stricter regulations all contributed to the energy efficiency solutions market's projected 8% yearly growth rate in 2023, which pushed the total value of the market to around $320 billion. The United States, China, Germany, and Japan are among the leading economies that have invested heavily in renewable energy integration and energy efficiency technology, driving this expansion.

The construction, manufacturing, and transportation industries all played significant roles in the industry's $85 billion valuation in the US in 2023. The 14th Five-Year Plan and China's robust industrial foundation helped boost the country's market value to $75 billion, putting it in second place. Germany and the UK led Europe in robust growth, with market values of $45 billion and $35 billion, respectively, driven by substantial expenditures in building retrofits and renewable energy sources. Sales of electric vehicles (EVs) surpassed 10 million units in 2023, a 25% increase from the previous year, demonstrating the crucial role that EV adoption has played. Projections show over 12 million units sold in 2024, showing that this boom is projected to continue. Another important factor is the integration of renewable energy sources. By 2024, the world's solar power capacity is projected to reach 1,100 GW, while wind power capacity will reach 800 GW.