Residential Energy Management Market - Forecast(2024 - 2030)

Residential Energy Management Market Overview

The global Residential Energy Management market size is forecast to reach $5.29 billion by 2027, growing at a CAGR of 11.6% from 2022 to 2027. Residential Energy Management is an analytical system that helps the operators of electric grids in monitoring, maintaining, managing, controlling and optimizing the performance level of the energy system. Furthermore, it also helps in managing the consumption level of energy and reducing the overall energy cost, which plays a major role in the growth of residential energy management market. Moreover, government initiatives in the form of regulations for controlling the emission level of carbon footprint and increasing energy consumption is driving the growth residential energy management systems. In addition, increasing penetration of internet of things (IoT), artificial intelligence (AI), machine learning (ML), reinforcement learning, cloud infrastructure and others for the development of energy management technology is set to boost the growth of residential energy management industry. The increasing usage of smart consumer appliances creates a huge demand for energy and light management software as well as various smart hardware components such as smart plugs, load control switches and others. Hence, the above-mentioned factors are fuelling the growth of Residential Energy Management industry during the forecast period 2022-2027.

Report Coverage

The report: “Residential Energy Management Market– Forecast (2022-2027)”, by IndustryARC covers an in-depth analysis of the following segments of the Residential Energy Management Market.

By Components: Hardware (Gateways, Relays, Load Control Switches (LCS), Demand Response (Dr) Devices, Heating, Ventilating, and Air-Conditioning (HVAC) Control Devices, Display Devices, Sensors, Controllers, and Others) and Software (Energy Management Platform (EMP), Energy Analytics, Customer Engagement Platform (CEP) and others.).
By Communication Technology: Wi-Fi Technology, Zigbee Technology, Z-Wave Technology, Wireless M-Bus Technology, Home-plug Technology, Thread Technology and Others.
By Applications: Smart Appliances, Smart Meters, Smart Thermostats, In-House Displays (IHD), and Others.
By Geography: North America (U.S, Canada, Mexico), South America (Brazil, Argentina and others), Europe (Germany, UK, France, Italy, Spain, Russia and Others), APAC (China, Japan India, South Korea, Australia and Others), and RoW (Middle east and Africa).

Key Takeaways

• North America held the major market share in 2021 and is estimated to witness significant growth during 2022-2027, owning to early adoption of this technology, increasing demand for electricity in this region and others.
• The market of Residential Energy Management is estimated to witness significant upsurge during the forecast period, owing to the growing demand for electricity across the world.
• This industry is consolidated with top market players including ABB Ltd, Eaton Corporation PLC, Schneider Electric SE, Honeywell International, Inc., Siemens AG among others. 

Residential Energy Management Market Segment Analysis - By Components

By components, the Residential Energy Management market is segmented into Hardware and Software. The software segment is analysed to grow with a significant CAGR of around 12.8%, during the forecast period 2022-2027. This segment is further sub segmented into Energy Management Platform (EMP), Energy Analytics, Customer Engagement Platform (CEP) and others. The growth of this segment is attributed to the growing adoption of connected smart appliances and the ease of accessibility along with the ability to handle a huge amount of data from multiple devices that generates and transmits data simultaneously. Furthermore, the software aggregates and analyses the data and information collected from a range of sources via monitoring and provides insights regarding the flow and consumption of energy within the household that aids in managing energy consumption more efficiently. Hence, such benefits create huge demand for residential energy management software and to meet such demand various players of this market are launching various advanced software products. For instance, in May 2021, Robert Bosch Engineering and Business Solutions (RBEI) introduced a new AIoT platform called, Phantom Edge, a combination of artificial intelligence (AI) and the IoT, that provides a real-time view of electrical energy consumption, operating usage, electrical parameters, and appliance-level information. Such developments will accelerate the adoption rate of Residential Energy Management software, thereby driving the growth of this market during the forecast period 2022-2027. 

Residential Energy Management Market Segment Analysis - By Applications

Based on Applications, Residential Energy Management Market is segmented into Smart Appliances, Smart Meters, Smart Thermostats, In-House Displays (IHD), and Others. According to Residential Energy Management Market report of IndustryARC, Residential Energy Management market size for smart appliance industry is analysed grow with a CAGR of 12.29% during 2022-2027, owing to increasing purchasing power and better access to the smart consumer electronic appliances. These factors drive the demand for electricity in residential sectors, which in turn creates demand for residential energy management technology to reduce the overall operational cost and improve the efficiency level along with productivity. A report of Collaborative Labeling and Appliance Standards Program (CLASP) states that, the residential sector in India accounted for 24% of total electricity consumption in 2016 and is projected to rise more than eight times by 2050. It also states that, this growth will be driven by the increasing usage of smart appliances and equipment. Such growth in adoption rate of smart appliances is set to boost the growth of this market. Furthermore, these solutions also help in monitoring the usage of electricity, which helps in optimizing the overall consumption of energy. This in turn, creates a positive impact on the demand of Residential Energy Management technology for smart appliances, thereby driving the growth of this market during 2022-2027. 

Residential Energy Management Market Segment Analysis - By Geography

North America dominated the market for Residential Energy Management market share in 2021, and is estimated to grow with a CAGR of around 11.35% during the forecast period 2022-2027, due to the early adoption of this technology, increasing demand for electricity, and growth in remote work culture as well as rapid growth in usage rate of smart appliances in homes. According to an IEA report, Residential demand for energy in U.S, grew by 1.5% in 2020 as more people worked from home during this period due to lockdown, and the energy consumption rate in residential sector is estimated to increase by 2.8% in 2021. Furthermore, presence of various norms and initiatives in this region, to reduce the greenhouses gas emission level of the building, generated through the energy usage, plays a major role in the growing demand for residential energy management system. Moreover, the presence of various market players and strategic steps taken by them to expand their business is boosting the growth of this market. In June 2021, SPI Energy, a leading renewable energy company and prominent provider of solar storage and electric vehicle (EV) solutions for business, residential, government, logistics and utility customers and investors, launched a cloud-based solar monitoring, smart energy management and maintenance platform Apollo, through its subsidiary company, Solar4America. Such developments will drive the growth of this market in this region during the forecast period 2022-2027.

Residential Energy Management Market Drivers

Rising Energy Consumption in residential sector across the world is set to boost the market growth:

The growing consumption of energy in the residential sector for various applications drives the demand for residential energy management technology. The growth in population across the world and increasing usage of smart appliances, growth in disposal income, urbanization and others are the main factors driving the demand for electricity. Furthermore, during the Covid-19 period, the remote working culture and work-from-home culture have witnessed a significant growth, which also affected the demand for energy in residential sector. According to a report of IEA 2021, the sub-Sharan Africa will witness a 30% boost in electricity demand in the next few years, due to the electrification of residential sector. Similarly, India energy outlook 2021, another report from IEA states that, Indian residential sector will witness a growth in electricity consumption, from around 1000 kWh per household in 2019 to 1500 kWh in 2030, due to the growth in disposable income of people in this country. Such growth in energy consumption will accelerate the demand for this technology, as the residential energy management solution not only reduces the energy cost as well as carbon footprint but also improves the productivity and efficiency level of energy usage. Hence, the above-mentioned factors will affect the growth of this market positively.

Implementation of advanced technologies for the development of this technology will fuel the growth:

One of the major driving factors contributing towards the market growth is the development and enhancement of residential energy management technology through the implementation of advanced technologies including AI, ML, Cloud, IoT and others. In May 2020, Electro Industries/GaugeTech (EIG) announced the release of its new cloud-based next generation Energy Management solution EnergyPQA.com. This software system improves the results of energy management systems by adding predictive artificial intelligence (AI) and power quality analytics, which in turn helps the system to predict the future usage trends of the customers. These insights allow the customers to reduce demand of energy and save on energy costs. Similarly, in February 2020, Honeywell introduced a new cloud-based, closed-loop, machine learning (ML) solution, Honeywell Forge Energy Optimization, that continuously studies about the energy consumption patterns of a building and automatically adjusts to optimal energy saving settings, that too without compromising the comfort levels of the customers. It helps in decreasing energy consumption, delivering double-digit energy savings and reducing the carbon footprint of a building. Hence, implementation of such advanced technologies is analysed to boost the growth rate of Residential Energy Management market during the forecast period 2022-2027.

Residential Energy Management Market Challenges

High initial cost for deploying this technology is harming the growth of this market

All though the residential energy management market is growing rapidly, but the high initial cost for deployment is creating hurdles for the growth of this market. This market requires a huge amount of capital investment for setting up the transmission network properly. The growing penetration of smart appliances, increasing population and the growth in disposable income create a huge demand for this technology but the associated initial cost is really high, which is a major drawback for this market. Hence, the above-mentioned factor will hamper the growth of this market during the forecast period 2022-2027.

Residential Energy Management Industry Outlook

Partnerships and acquisitions along with product launches are the key strategies adopted by the players in this market. Residential Energy Management top 10 companies include:

1. ABB Ltd
2. Eaton Corporation PLC
3. Schneider Electric SE
4. Honeywell International, Inc.
5. Siemens AG
6. General Electric Company
7. Robert Bosch GmbH
8. Itron, Inc.
9. Emerson Electric Co.
10. Aclara Technologies LLC

Acquisitions/Technology Launches/Partnerships

• In March 2021, Itron, a leading provider of energy management technology, launched its eHZ-B residential smart meter for utilities and cities across Germany. This meter is built with advanced functionality to support ongoing energy transition to a low carbon, environmentally sound, reliable and affordable energy supply, and equip utilities and cities across Germany, to safely migrate to a smart and connected distribution network
• In October 2020, Schneider Electric Solar announced the launch of its new products, InsightHome and InsightFacility. Both the products are smart edge devices, which connects Schneider Electric solar and storage systems of the customers to the Insight app. InsightHome targets the residential solar and storage market globally while InsightFacility is for large residential and commercial solar and storage systems.
• In June 2020, Sunverge collaborated with Eaton to accelerate the growth of the nascent smart home energy market and to provide intelligent and dynamic energy management of in-home appliances, by offering information related to the real-time flexible load management and optimization as well as enhanced resiliency and backup power longevity to the grid.

Relevant Report Titles:

Energy Management System Market - Industry Analysis, Market Size, Share, Trends, Application Analysis, Growth And Forecast 2021 - 2026
Report Code: ITR 29798

Home Energy Management System Market – Forecast (2021 - 2026)
Report Code: ESR 0148

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