In the modern, environmentally conscious age, conserving energy is a priority for businesses and governments. Energy management systems (EMS) are frameworks that allow energy consumption to be monitored and controlled with precision. Businesses are able to identify opportunities to save energy and costs, ultimately helping the environment. As the climate crisis edges higher up the global agenda, the market for energy management systems continues to climb. BCC Research estimates the market will reach $75.3 billion by 2027, growing at a compound annual growth rate of 14.6% between 2022-2027.
Let’s dive into the key factors propelling this industry forward.
Governments across the world are increasingly modernizing their energy grids by adopting smart grid solutions in a bid to save energy and costs. Such moves are in line with the growing propensity toward achieving energy efficiency and adopting renewable energy.
In order to tackle climate change and increase energy efficiency, the European Union set itself a target to ensure that 80% of EU consumers use smart meters by the end of 2020. The move aims to accelerate the use of cleaner energy and lower energy consumption. However, as of December 2022, only about 56% of the electricity customers deployed smart meters.
In keeping with this, Endesa S.A., a Spanish multinational electric utility company, secured an additional $269.8 million (€250.0 million) from the European Investment Bank, as of January 2023. The company has secured a second round of “sustainable” financing totaling $545 million (€500 million) for the modernization and growth of Spain’s distribution networks with smart technologies in order to improve supply security and quality from now until 2024.
North America is also experiencing significant growth in the adoption of smart metering solutions and smart grid investments. According to the Institute for Electric Efficiency, by the end of 2024, the adoption rate of smart meters in the region is expected to reach over 80%, up from around 60% in 2018. China and Japan are leading in smart meter penetration in the Asia-Pacific region, and the Indian government is emphasizing the adoption of smart metering in the country.
Apart from smart metering, global investments in smart grids are increasing significantly. According to the US EIA, the global smart grid electricity grid infrastructure investment in 2021 reached $290 billion, surpassing the $270 billion high set in 2019.