1Q 2020

ESCO Global Market Analysis and Forecast

Performance Contracting and Other Energy Services for Public Sector and Commercial Buildings

Energy service companies (ESCOs) evolved in the US and spread globally to provide access to energy efficiency technologies and services. The energy savings performance contract (ESPC) financing structure adopted by ESCOs requires little to no upfront capital and transfers the performance risk of the project from the end-use customer to the ESCO. This model became one of the first energy as a service (EaaS) options available to customers.

The ESCO market is mature in the US and growing in other regions of the world. However, it is facing increasing pressure to respond to changing consumer expectations and competitive landscape. On the demand side, clients are becoming more sophisticated and are looking for cost-effective, customized, and comprehensive energy solutions to meet their needs beyond energy efficiency upgrades. On the supply side, energy suppliers and vendors are introducing a broader set of turnkey, portfolio-wide financial and business model options to meet emerging customer needs. These trends require ESCOs to diversify project development efforts and develop new technology-agnostic capabilities and financing options outside of ESPC structures.

This Guidehouse Insights report analyzes the global ESCO market, with a focus on three key regions: North America, Europe, and Asia Pacific. The study estimates the ESCO market size and forecast as total revenue generated annually from long-term contracting models with savings performance guarantees and examines market barriers and drivers, regional opportunities and challenges, and the competitive landscape. Global market forecasts, segmented by region, country, and customer and equipment type, extend through 2029.

Pages 47
Tables | Charts | Figures 32
  • What is the current state of commercial and public building ESCO markets?
  • How are customer energy and energy efficiency needs changing?
  • What is the impact of new simpler and shorter financing mechanisms on ESCO markets?
  • What are the drivers and barriers in ESCO markets?
  • What is the size of the EaaS market opportunity versus ESCO revenue?
  • How is the ESCO market expected to grow in the next 10 years?
  • How is revenue expected to differ by region, financing instrument type, customer segment, and technology type?
  • Energy service companies (ESCOs)
  • Original equipment manufacturers (OEMs)
  • Energy services and solutions providers
  • Regulators and policymakers
  • Utilities
  • Energy efficient building technology vendors
  • Universities and colleges
  • Hospitals and healthcare facilities
  • Government agencies
  • Investor community

1. Executive Summary

1.1   Market Overview

1.2   Market Trends

1.3   Forecast Overview

2. Market Issues

2.1   Market Overview

2.2   Report Scope

2.3   ESCO Financing Mechanisms

2.3.1   Performance Contracting

2.3.1.1   Guaranteed Savings

2.3.1.2   Shared Savings

2.3.2   Other Financing Solutions

2.4   Market Drivers

2.4.1   CAPEX Avoidance for Energy Use Reduction and Cost Savings

2.4.2   Risk Transfer Advantage

2.4.3   Digital Platform Efficiencies

2.4.4   Power Reliability and Resilience

2.4.5   Ancillary Project Benefits

2.4.6   GHG Targets and Sustainability Initiatives

2.5   Market Barriers and Threats

2.5.1   Changing Consumer Expectations

2.5.2   Contract Length

2.5.3   Contract Complexity

2.5.4   Policy Landscape

2.5.5   M&V for Guaranteed Savings

2.5.6   DER Project Development Skills

2.5.7   Energy Price Volatility

2.6   US Market Segment Trends

2.6.1   Federal DOD

2.6.2   Federal Civilian Agencies

2.6.3   Municipal, County, and State Governments

2.6.4   Universities and Colleges

2.6.5   K-12 Schools

2.6.6   Healthcare

2.6.7   Commercial

2.7   Regional Dynamics

2.7.1   Europe

2.7.2   Asia Pacific

2.7.3   Other Regions

3. Market Forecasts

3.1   Introduction

3.1.1   Methodology

3.1.1.1   Primary Research

3.1.1.2   Secondary Research

3.1.2   Forecast Scope

3.1.3   Changes from Guidehouse Insights’ 2017 ESCO Market Overview

3.2   Global Overview

3.3   North America

3.4   Europe

3.5   Asia Pacific

3.6   Conclusions and Recommendations

4. Building Types

4.1   Office

4.2   Retail

4.3   Education

4.4   Healthcare

4.5   Hotels and Restaurants

4.6   Institutional/Assembly

4.7   Warehouse

4.8   Transport

5. Acronym and Abbreviation List

6. Table of Contents

7. Table of Charts and Figures

8. Scope of Study, Sources and Methodology, Notes

  • Energy Services Revenue vs. ESCO Revenue by Segment, World Markets: 2020-2029
  • ESCO Revenue by Region, World Markets: 2020-2029
  • ESCO Revenue by Customer Type, World Markets: 2020-2029
  • ESCO Revenue by Equipment Type, World Markets: 2020-2029
  • ESCO Revenue by Financing Mechanism, World Markets: 2020-2029
  • ESCO Revenue by Country, North America: 2020-2029
  • ESCO Revenue by Customer Type, North America: 2020-2029
  • ESCO Revenue by Country, Europe: 2020-2029
  • ESCO Revenue by Customer Type, Europe: 2020-2029
  • ESCO Revenue by Country, Asia Pacific: 2020-2029
  • ESCO Revenue by Customer Type, Asia Pacific: 2020-2029
  • The Rise of Portfolio-Wide, Beyond Energy Efficiency Solutions
  • New Beyond Energy Efficiency ESPC Project Delivery Capability Needs
  • ESCO Revenue Segmentation within EaaS markets
  • Energy Services Revenue and ESCO Revenue by Segment, World Markets: 2020-2029
  • ESCO Revenue by Region, World Markets: 2020-2029
  • ESCO Revenue by Customer Type, World Markets: 2020-2029
  • ESCO Revenue by Equipment Type, World Markets: 2020-2029
  • ESCO Revenue by Financing Mechanism, World Markets: 2020-2029
  • ESCO Revenue by Country, North America: 2020-2029
  • ESCO Revenue by Customer Type, North America: 2020-2029
  • ESCO Revenue by Equipment Type, North America: 2020-2029
  • ESCO Revenue by Financing Mechanism, North America: 2020-2029
  • ESCO Revenue by Country, Europe: 2020-2029
  • ESCO Revenue by Customer Type, Europe: 2020-2029
  • ESCO Revenue by Equipment Type, Europe: 2020-2029
  • ESCO Revenue by Financing Mechanism, Europe: 2020-2029
  • ESCO Revenue by Country, Asia Pacific: 2020-2029
  • ESCO Revenue by Customer Type, Asia Pacific: 2020-2029
  • ESCO Revenue by Equipment Type, Asia Pacific: 2020-2029
  • ESCO Revenue by Financing Mechanism, Asia Pacific: 2020-2029
  • Overview of ESCO ESPC-Related Project Finance Asset Classes
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