Energy Management System Market Size, Share & Industry Analysis, By System Type (Home Energy Management System, Building Energy Management System, and Industrial Energy Management System), By End-user (Residential/Smart Homes and Commercial Building/Complex), By Application (Property Safety, Automation, Energy Distribution, Design, e-Mobility, and Others), By Industry (Oil & Gas, Manufacturing, Energy & Utilities, Automotive, Healthcare, and Others), and Regional Forecast, 2024-2032

The global energy management system market size was valued at USD 31.76 billion in 2023. The market is projected to grow from USD 35.90 billion in 2024 to USD 112.32 billion by 2032, exhibiting a CAGR of 15.3% during the forecast period.

An energy management system (EMS) is a tool for monitoring, analyzing, and optimizing the operation of power transmission systems. This system is widely used across different industries and EMS implementations, including Automatic Generation Control (AGC), SCADA, alarms, and others. The demand for energy management systems has increased across industrial, commercial, residential, and public sector enterprises due to a rise in strategic investments to manage energy consumption.

The increasing adoption of smart grids and smart meters is playing a key role in increasing the market value. Additionally, governments across the globe are working to digitize national energy systems, increasing their efficiency and enhancing their value to enhance economic growth. The governments of different countries are aligning their vision toward sustainable, safe, and affordable energy systems, thereby driving market growth.

Furthermore, EMS helps companies reduce their energy consumption by 30% and aims to ensure operational delivery and safety. Global energy issues, such as optimizing renewable energy resources, decreasing carbon footprints, managing greenhouse gas emissions, and reducing energy consumption, will drive product adoption. Further, growing investments in the development of energy-efficient smart buildings, smart cities, or smart industry projects drive the energy management system market growth during the forecast period.

The global COVID-19 pandemic obstructed industrial activities by changing the energy demand patterns. The closure of major industries and production plants led to a considerable drop in energy as well as electricity demand across the world. The pandemic reduced energy consumption by heavy industries such as oil, coal, and natural gas. This led to a shrink in the energy demand across the key economies of different countries, including Germany, the U.S., the U.K., Italy, and others. Remote working trends have reduced commuting needs, resulting in lower carbon emissions. It also increased the importance of digital solutions used for monitoring and controlling energy systems. Thus, market growth has been restricted due to reduced industrial activities during the pandemic.

Generative AI Impact

Integration of Generative AI with Smart Buildings Help to Boost Market Growth

The emergence of generative AI in the energy and power industry holds maximum potential to reduce costs, optimize operational efficiency, and enhance safety, which leads to improving the sustainability of the EMS. Generative AI can help to mitigate environmental impact by analyzing data and recommending sustainable practices to reduce energy losses. Generative AI is playing a vital role in optimizing renewable energy generation and integration. Thus, by estimating data from renewable sources, AI algorithms can forecast energy output, enhance grid integration, and optimize power generation. For instance,

• In November 2023, Schneider Electric integrated OpenAI tool with the energy and sustainability product hub to automate data management for various facilities management functions across commercial and industrial properties.

Increasing integration of generative AI with smart buildings helps to generate a more intelligent and efficient built environment by optimizing building design, energy optimization, along data security and privacy. The generative AI models can also be helpful in enhancing the accuracy of building security systems along with minimizing energy consumption.

Energy Management System Market Trends

Surge in Demand for Electric Vehicle Station is Reshaping the HEMS Market

Smart energy management solutions are considered a load balancer for EV charging infrastructures and other household systems. The need for intelligent and efficient charging solutions for electric vehicles is becoming increasingly important to reduce operating costs. It generally provides environmentally friendly transportation along with lower operating costs and also helps to minimize the strain on power generation. This factor boosts the demand for the adoption of EV charging solutions in the smart homes market to ensure the maximum utilization of the smart grid. The integration of EV energy models will have a huge impact on home energy usage patterns and aims to generate new opportunities to improve the efficiency of charging infrastructure across smart homes. For instance,

• In December 2023, Ford Motor Company entered a partnership with Resideo Technologies, Inc. and launched a joint project named "EV-Home Power Partnership," to explore the potential of EV batteries and provide vehicle-to-home (V2H) energy management benefits to customers who own a Resideo smart thermostat and F-150 Lightning solutions.

The usage of EV charging stations reduces the overloading of electrical systems, which significantly helps to save electricity costs and aims to optimize the efficient distribution of power. Thus, the demand for electric vehicle stations drives market growth to reshape the home energy management systems (HEMS) during the forecast period.

Energy Management System Market Growth Factors

Integration of IoT with Smart Grids and Smart Meters to Drive Market Growth

IoT is an emerging technology that can be used to efficiently manage energy consumption in the industrial, commercial, and residential sectors in smart environments. The integration of IoT with the energy and power sector is bringing smart infrastructure developments to reduce the complex energy crisis. It also aims to reduce human intervention in performing critical operations that further boost workplace safety. Smart grids are designed to reduce long-term costs via intelligent energy IoT monitoring solutions and power redirection for quick recovery when power outages are detected. Growing investments in smart projects, including smart farming, smart buildings, and smart cities, generate a huge demand for advanced energy management systems.

Further, the integration of IoT technology with smart grids, smart meters, and other energy devices allows for improved two-way communication and helps to reduce system downtime by enhancing the reliability of the power distribution station. It also helps to lower the operational cost by automating the control of the operation management process. Thus, technologically advanced smart grids and smart energy meters are anticipated to promote the progress of the market. Thus, the rising integration of IoT technology with smart meters and smart grids also boost market growth.

RESTRAINING FACTORS

High Installation Cost of EMS to Hinder Market Growth

The installation cost of an energy management system is majorly based on different factors, which include the size of the facility, complex infrastructure, hardware and software components, and others. This factor is restricting the global market growth during the forecast period. In addition, due to the price variation associated with renewable energy, companies are shifting their focus toward commercial energy for the completion of operational work in the industrial procedure through the help of an energy management system. The home energy management systems (HEMS) generally cost at least USD 2.50 per square foot and up to USD 7.00 per square foot when employing conventional applications and methodologies. The developed infrastructure of large companies is leading them to adopt advanced energy management solutions. The high installation cost is the key factor that restricts the growth of the market during the forecast period.

Energy Management System Market Segmentation Analysis

By System Type Analysis

Rise in Energy Consumption across Various Industries to Boost Industrial Segment Growth

On the basis of system type, the market is segmented into home EMS, building EMS, and industrial EMS.

The industrial EMS is expected to record maximum share over the forecast period. This is due to the growing usage of industrial energy management solutions (IEMS) in industrial operations such as power plants, factories, and other large manufacturing plants to optimize energy usage and reduce waste. Similarly, the revolution in Industry 4.0 and factory automation to optimize system performance and to boost the performance of the energy equipment. These are the key factors which are set to drive the demand for industrial energy management systems (IEMS) during the forecast period.

The development of smart infrastructure combined with government initiatives has led to significant investments in commercial and residential development projects such as smart homes, smart buildings, and smart hospitals. These infrastructures will boost the demand for efficient home and building energy management systems (EMS) to optimize the energy usage.

By End-user Analysis

Rapid Automation and Usage of High Power Consumption Equipment to Propel Commercial Segment Growth

Based on end-user, the market is categorized into residential/smart homes and commercial buildings/complex.

The commercial building/complex segment is projected to record maximum share over the forecast period. The commercial end-users use high power consumption equipment such as DG equipment, utility transformers, HVAC systems, and data centers, which significantly boost the adoption of EMS across the sector. Similarly, the integration of different technologies such as water and energy distribution and security among buildings and complexes increases the energy costs spending, which drives the product demand. Thus, the commercial building/complexes segment is expected to help boost market growth during the forecast period.

The residential/smart homes segment is estimated to grow with a rapid growth rate over the forecast period. Growing demand for improved housing infrastructure and the adoption of advanced metering infrastructure (AMI), smart grid, and smart metering solutions in homes helps optimize energy usage. This factor is expected to drive the growth of the residential/smart homes segment.

By Application Analysis

Integration of Large Number of Enterprises of Different Industries to Drive the Energy Distribution Segment Share

Based on application, the market is divided into property safety, automation, energy distribution, design, e-mobility, and others.

Energy distribution is projected to register the highest market share in 2023. This is due to the growing number of industries along with the significant shift of people into metro cities. Similarly, to ensure power supply reliability, maintaining load flow and optimal power flow across various industry verticals, the demand for energy distribution is high as compared to others.

The automation segment is estimated to witness the highest CAGR during the forecast period owing to the increasing focus on rapid production and digitalized industrial operations. The usage of energy management solutions enhances the optimal fuel efficiency of the engine, battery, and auxiliary systems. Similarly, the increasing demand for electric vehicles and rising fuel costs will boost EMS adoption in e-mobility.

By Industry Analysis

Government’s Stringent Rules will Fuel Oil and Gas Segment Growth

Based on industry, the market is divided into oil & gas, manufacturing, energy & utilities, automotive, healthcare, and others.

The oil & gas sector held the largest market share in 2023 owing to the growing demand for energy consumption monitoring. Governments across the globe are imposing strict regulations on the oil and gas sector for efficient energy consumption and the sustainability of the environment. Implementing power management systems can offer industries considerable energy savings and lower carbon emissions in a cost-optimized way.

The manufacturing industry is projected to grow at the highest growth rate during the forecast period. This is due to the increasing adoption of automated machines and digital tools to minimize production costs by minimizing energy consumption across the globe. Similarly, the growing demand for manufacturing electric vehicles is expected to boost market expansion further.

The energy and utility industry held the third largest market share in 2023 as it is a major source of carbon dioxide (CO2), sulfur oxide (SOx), and nitrogen oxide (NOx) emissions. The energy management system provides a suitable solution to control these emissions and manage quotas and credits. It drives the adoption of such systems across the energy and utility industry. The developing smart buildings or smart city projects are massively deploying intelligent systems to reduce the enormous consumption of resources and energy in urban spaces. This is expected to boost the EMS market growth in future.

REGIONAL INSIGHTS

By geography, the global market is classified across five regions: North America, Europe, Asia Pacific, the Middle East & Africa, and Latin America.

North America holds the largest market share and is expected to dominate the market during the forecast period. ISO 50001 measures in support of LEED certification are driving the adoption of energy systems across the region. Besides, energy regulations in the U.S. are drastically changing due to political influences. These changing policies are directly affecting product adoption. North America has the presence of leading companies, including Microsoft Corporation, Apple, Inc., IBM Corporation, and others. These are the key companies investing in deploying advanced EMS solutions to reduce energy waste across various industries. Moreover, increasing investments in advancing energy management solutions to promote the usage of renewable energy sources further stimulate market growth during the forecast period.

Europe holds a substantial market share owing to the growing demand for smart grid solutions to modernize traditional power grids. Besides, the European Union is promoting various energy efficiency measures and standards, accelerating the demand for power management systems across Europe.

Asia Pacific is estimated to hold the highest CAGR during the forecast period. This growth will be fueled by the evolving sustainable energy infrastructure across the region. This is due to the increasing development in residential and industrial architectures, which is generating demand for smart metering and smart grid solutions for the optimization of energy utilization. Moreover, the demand for next-gen energy management services and solutions is supported by the set-up of an ambitious sustainable energy agenda by regional energy associations. The increase in population and rise in industrial automation are key factors increasing the energy management system market share in Asia Pacific.

The Middle East & Africa and Latin America markets are projected to grow moderately during the forecast period. These regions are inclined toward the development of smart cities and reducing carbon emissions by implementing the carbon policy, which is why they adopt smart technologies to reduce harmful carbon emissions.

List of Key Companies in Energy Management System Market

Key Players to Enhance Product Portfolios for Sustaining their Positions

Product launches, collaborations, partnerships, and acquisitions are strategies adopted by key players to compete in this market. Moreover, companies are also focusing on continuous product enhancement with easy-to-operate features, which helps them to sustain competitiveness and raise their brand value. Several industry players are investing their capital in research and development activities. Various emerging players are offering superior components, integrated systems, software, and services to strengthen their market positions.

List of Key Companies Profiled:

• General Electric Company (U.S.)


• IBM Corporation (U.S.)


• Honeywell International Inc. (U.S.)


• Schneider Electric SE (France)


• Siemens AG (Germany)


• Eaton Corporation (Ireland)


• ABB Limited (Switzerland)


• Johnson Controls International PLC (U.S.)


• Emerson Electric Company (U.S.)


• NEC Corporation (Japan)

KEY INDUSTRY DEVELOPMENTS

• December 2023: The UAE Ministry of Energy and Infrastructure (MoEI) deployed an Energy Management System powered by artificial intelligence on federal roads to implement an adaptive street lighting system that optimizes illumination levels from the traditional high-pressure sodium (HPS) lamps to LED lights.


• July 2023: Schneider Electric, in collaboration with Pacific Gas and Electric Company (PG&E), launched a new distributed energy resource management system (DERMS) based on the Microsoft Azure platform. This DERMS system helps to enhance the value of energy storage, electric vehicles, and solar to provide affordable energy to their customers.


• February 2023: Emerson integrated its power-sector expertise and renewable energy capabilities to deploy the Ovation Green platform. The platform aided power generation companies in meeting consumer demands for green energy transition and management. It also incorporated Mita-Teknik software to enhance green energy initiatives and expand sustainable operations in the market.


• March 2022: ABB India launched new smart metering solutions for efficient energy management and to monitor power consumption. The company also offers network analyzers, single and multifunction meters to complete power quality analysis across various industries such as hospitality, healthcare, infrastructure, and food and beverages.


• February 2022: Eaton partnered with LG to integrate EMS and EV charging technologies to enable critical data and load management for solar power and storage solutions. This partnership would accelerate Eaton's home-as-a-grid approach to bring energy transition.

REPORT COVERAGE

The report provides a comprehensive analysis of the market. It focuses on key aspects such as prominent companies and leading applications of the product. Besides this, the report highlights key industry developments and offers insights into the market trends. In addition to the aforementioned factors, the report includes several factors that have contributed to the growth of the market in recent years.

REPORT SCOPE & SEGMENTATION

ATTRIBUTE	DETAILS
Study Period	2019–2032
Base Year	2023
Estimated Year	2024
Forecast Period	2024–2032
Historical Period	2019– 2022
CAGR	Growth rate of 15.3% from 2024 to 2032
Unit	Value (USD Billion)
Segmentation	By System Type Home Energy Management System Building Energy Management System Industrial Energy Management System By End-user Residential/Smart Homes Commercial Building/Complex By Application Property Safety Automation Energy Distribution Design e-Mobility Others (Energy Storage) By Industry Oil & Gas Manufacturing Energy & Utilities Automotive Healthcare Others (IT and Telecom, Hospitality) By Region North America (By System Type, End-user, Application, Industry, and Country) U.S. (By Application) Canada (By Application) Europe (By System Type, End-user, Application, Industry, and Country) U.K. (By Application) Germany (By Application) France (By Application) Italy (By Application) Spain (By Application) Russia (By Application) Benelux (By Application) Nordics (By Application) Rest of Europe Asia Pacific (By System Type, End-user, Application, Industry, and Country) China (By Type) Japan (By Application) India (By Application) South Korea (By Application) ASEAN (By Application) Oceania (By Application) Rest of Asia Pacific Middle East & Africa (By System Type, End-user, Application, Industry, and Country) Turkey (By Application) Israel (By Application) GCC (By Application) North Africa (By Application) South Africa (By Application) Rest of the Middle East & Africa Latin America (By System Type, End-user, Application, Industry, and Country) Brazil (By Application) Mexico (By Application) Rest of Latin America