by Industrial operations are highly energy intensive with large power requirements for heating, cooling, lighting and running industrial machinery. Adopting energy efficient practices and technologies helps industries lower their energy bills substantially and reduce carbon footprint. Energy efficiency improvements in industrial facilities can be achieved by installing LED lighting, upgrading to energy efficient HVAC and boiler systems, improving compressed air and steam systems, utilizing variable speed drives and implementing industrial IoT solutions for remote equipment monitoring. This allows automatic control and optimization of energy usage. Various types of industrial motors that consume over half of industrial electricity can benefit greatly from retrofitting with premium efficiency models. Additionally, utilizing waste heat recovery systems to generate steam or power can boost overall plant efficiency.
The global Industrial Energy Efficiency Market is estimated to be valued at US$ 1.2 Trillion in 2023 and is expected to exhibit a CAGR of 8.6% over the forecast period 2024 to 2031, as highlighted in a new report published by Coherent Market Insights.
Market key trends:
Stringent government regulations and policies for carbon emission reductions from industrial facilities are a key driver for the growth of industrial energy efficiency market. Many nations have set targets to become carbon neutral by mid century which is increasing focus on decarbonizing energy intensive industries. The European Union’s performance standards for industrial electric motors and the Minimum Energy Performance Standards (MEPS) program in the US are compelling industries to adopt high efficiency equipment. Additionally, carbon pricing mechanisms in various countries provide monetary incentives for industries to lower carbon footprint through energy efficiency upgrades. Rise in global energy prices is also prompting industries to invest more on improving energy usage and reducing consumption.
Porter’s Analysis
Threat of new entrants: The industrial energy efficiency market requires high initial capital investments in R&D, manufacturing facilities and distribution networks which act as a barrier for new companies.
Bargaining power of buyers: Large industrial customers have significant bargaining power due to bulk buying ability which can lower down the prices.
Bargaining power of suppliers: The market has large number of technology providers and component suppliers thereby reducing individual supplier power.
Threat of new substitutes: Alternatives like renewable sources of energy pose moderate threat as substitutes.
Competitive rivalry: The market is consolidated with global players competing on the basis of product quality, technological innovations and service offerings.
Key Takeaways
Global Industrial Energy Efficiency Market Demand is expected to witness high growth. Process optimization, retrofitting of existing equipment, use of IoT based solutions for monitoring and automation are some of the major approaches undertaken by industries to enhance energy efficiency.
Regional analysis- Asia Pacific region is expected to dominate the market owing to rapid industrialization and presence of major economies like China, India and Japan which are undertaking initiatives to promote energy efficient technologies and practices. Government schemes and incentives promoting energy efficiency adoption would further aid the market in the region.
Key players operating in the Industrial Energy Efficiency market are Siemens, ABB, Eaton, Schneider Electric, Honeywell, Rockwell Automation and GENERAL ELECTRIC. Siemens and ABB are market leaders offering a wide range of solutions including power monitoring systems, drives, motors, variable speed drives, smart metering and lighting control systems.
*Note:
1. Source: Coherent Market Insights, Public sources, Desk research
2. We have leveraged AI tools to mine information and compile it
