The Energy Efficiency Opportunity

The Energy Efficiency Opportunity

          
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The Energy Efficiency Opportunity

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    A Fragmented Industry...

    In most countries, four types of players compete for EE projects: ESCOs, integrated OEMs, utilities, and more focused market participants, such as small engineering companies, installers, and systems integrators. (See Exhibit 3.) Each type has distinct objectives and strengths. ESCOs have long focused on equipment contracting and benefit from their considerable experience, end-to-end technological competencies, and perceived independence from other providers. For integrated OEMs, the EE market offers an opportunity to establish direct contact with end customers and increase the penetration of their equipment portfolio. Utilities often enter the market in an effort to protect their core energy businesses or because they are under pressure from regulators to increase their customers’ energy efficiency. More focused players compete for individual projects or act as subcontractors to larger market participants.

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    To date, EE markets have remained highly fragmented in most countries. In major markets, no company has yet been able to grow its business quickly enough to establish a dominant position, either in the market as a whole or in individual segments.

    Within the next three years, increasing numbers of new competitors from different backgrounds will enter the fray, attracted by the industry’s high growth rates and driven by flagging growth in their core markets. Each company will approach the EE market from its own angle and seek to leverage its existing strengths. Metering companies, especially in Europe, could try to leverage their superior access to actual consumption data to establish a business centered on energy monitoring and management, for example. Similarly, facility managers could leverage their typically strong familiarity with their customers’ operations to identify potential opportunities for cross-selling EE products and services.