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4Q 2021

Market Data: ESCO Performance Contracting

Global ESCO Market Analysis, Size, and Forecasts: ESPC, EaaS, and Other Contracting Mechanisms

The past 2 years have a been a time of significant change in energy service company (ESCO) markets. The ESCO market is facing increasing pressure to respond to changing consumer expectations and competitive landscape. Clients are becoming more sophisticated in their expectations and look for cost-effective, customized, and comprehensive energy solutions to meet their needs beyond energy efficiency upgrades. As a result, the definition of ESCO is evolving to incorporate more solutions beyond energy savings performance contracting (ESPC). Although ESPC continues to dominate the market, other types of performance contracting, such as energy as a service (EaaS), are becoming a larger part of the ESCO business.

ESCOs, energy suppliers, and other vendors are introducing a broader set of turnkey, portfoliowide, financial, and business model options to meet emerging customer needs. ESCOs that recognize their core competencies and create partnerships and strategies to amplify solution offering capabilities are expected to become market leaders. Unprepared vendors face market disruption and significant competition from both traditional and non-traditional competitors and simpler financing options.

This Guidehouse Insights report estimates the ESCO market size and forecast as total revenue generated annually from long-term contracting models with performance guarantees. The report is primarily focused on the North American market but also provides information on how the ESCO business model is developing in Europe and Asia Pacific. This report’s ESCO revenue forecast is split into two segments: guaranteed savings performance contracts and other financing mechanisms (which include shared savings, EaaS, and other contracting tools with performance guarantees). The forecast is additionally segmented by six customer segments and by seven technology types.

Pages 32
Tables | Charts | Figures 27
  • What is the state of the ESCO market?
  • How are customer needs changing?
  • What is the impact of EaaS on ESCO markets?
  • What are the drivers and barriers in ESCO markets?
  • What is the size of the EaaS market opportunity?
  • How is the ESCO market expected to grow in the next 10 years?
  • How is revenue expected to differ by region?
  • How is revenue expected to differ by financing instrument type?
  • How is revenue expected to differ by customer segment?
  • How is the revenue expected to differ by technology type?
  • Energy service companies (ESCOs)
  • OEMs
  • Energy services and solutions providers
  • EaaS companies
  • Regulators and policymakers
  • Utilities
  • Investor community

1. Executive Summary

1.1   Market Trends

1.2   Market Drivers and Barriers

1.3   Market Forecast

2. Market Issues

2.1   Market Overview

2.2   ESCO Performance Contracting Mechanisms

2.2.1   Guaranteed Savings

2.2.2   Other Contracting Mechanisms

2.2.2.1   Shared Savings

2.2.2.2   EaaS

2.3   Shifting Customer Needs and Expectations

2.4   Market Drivers

2.4.1   CAPEX Avoidance

2.4.2   Risk Transfer

2.4.3   Cost Savings

2.4.4   Sustainability Commitments and GHG Emissions Reductions

2.4.5   Maturation of the EaaS Model

2.4.6   Resilience and Energy Supply Needs

2.4.7   Technology Innovation and Digital Platform Efficiencies

2.5   Market Barriers

2.5.1   Contract Complexity and Length

2.5.2   Uneven Customer Awareness of EaaS

2.5.3   Lack of Energy Supply, Energy Flexibility, and Sustainability Project Development Skills

2.5.4   Policy Landscape

2.5.5   Energy Price Volatility

3. Market Forecasts

3.1   Introduction

3.2   Methodology

3.2.1   Primary Research

3.2.2   Secondary Research

3.3   Forecast Scope and Definitions

3.3.1   Changes from Guidehouse Insights’ 2020 ESCO Report

3.4   Global Overview

3.5   North America

3.6   Europe

3.7   Asia Pacific

4. Conclusions and Recommendations

5. Acronym and Abbreviation List

6. Table of Contents

7. Table of Charts and Figures

8. Scope of Study, Sources and Methodology, Notes

  • ESCO Revenue by Region, World Markets: 2021-2030
  • ESCO Revenue by Contract Type, World Markets: 2021-2030
  • ESCO Revenue by Customer Type, World Markets: 2021-2030
  • ESCO Revenue by Equipment Type, World Markets: 2021-2030
  • ESCO Revenue by Contract Type, North America: 2021-2030
  • ESCO Revenue by Customer Type, North America: 2021-2030
  • ESCO Revenue by Contract Type, Europe: 2021-2030
  • ESCO Revenue by Customer Type, Europe: 2021-2030
  • ESCO Revenue by Contract Type, Asia Pacific: 2021-2030
  • ESCO Revenue by Customer Type, Asia Pacific: 2021-2030
  • Evolution of Energy Services Solution Offerings
  • ESCO Revenue by Region, World Markets: 2021-2030
  • ESCO Revenue by Contract Type, World Markets: 2021-2030
  • ESCO Revenue by Customer Type, World Markets: 2021-2030
  • ESCO Revenue by Equipment Type, World Markets: 2021-2030
  • ESCO Revenue by Contract Type, North America: 2021-2030
  • ESCO Revenue by Customer Type, North America: 2021-2030
  • ESCO Revenue by Equipment Type, North America: 2021-2030
  • ESCO Revenue by Country, North America: 2021-2030
  • ESCO Revenue by Contract Type, Europe: 2021-2030
  • ESCO Revenue by Customer Type, Europe: 2021-2030
  • ESCO Revenue by Equipment Type, Europe: 2021-2030
  • ESCO Revenue by Country, Europe: 2021-2030
  • ESCO Revenue by Contract Type, Asia Pacific: 2021-2030
  • ESCO Revenue by Customer Type, Asia Pacific: 2021-2030
  • ESCO Revenue by Equipment Type, Asia Pacific: 2021-2030
  • ESCO Revenue by Country, Asia Pacific: 2021-2030
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