Confidence in the UK’s fast growing non-domestic energy efficiency market, valued at £10bn to £15bn, is at an all-time high a new report reveals.
The latest quarterly Energy Efficiency Trends Report is based on a survey of the UK’s leading non-domestic energy efficiency suppliers and consumers. These are typically organisations who supply energy efficiency technologies and services to non-domestic clients and consumer organisations in the private and public sectors who buy energy efficiency technologies and services.
Highlights of the report, produced by EEVS Insight, Bloomberg New Energy Finance and the UK Green Investment Bank, include:
• Suppliers of energy efficiency technologies and services have expressed their highest level of confidence in the energy efficiency market since tracking began in 2012.
• The confidence index contained in the report is a measure drawn from five key indicators: order books, staff numbers, sale prices, industry risk and effectiveness of Government energy efficiency policy.
• Almost half of the suppliers surveyed confirmed a rise in their number of UK employees in the past quarter.
• Over the same period public and private sector organisations have shown increased demand for energy efficiency technologies.
• Demand is driven by an increase in new projects in the areas of energy efficiency lighting and controls, motors and drives, HVAC, boiler optimisation, and refrigeration.
• New projects continue to be concentrated in a wide range of property types most notably offices, public buildings, schools and universities.
• Median project cost has reached an all-time high of £167,000 per project.
• In the area of finance, in-house funding continues to be the dominant method of backing new projects although it is on sustained downward trend in favour of combined in-house and third party finance.
• Consumers’ expectations are shifting towards longer payback periods with almost a third expecting payback over more than five years.
Bill Rogers, Head of Strategy at the UK Green Investment Bank, said:
“Greater energy efficiency is the key to a greener, more productive, competitive and secure UK economy. Although a relatively new market in the UK, non-domestic energy efficiency is fast growing and is forecast to require up to £15bn of investment between now and 2020. Confidence is critical to a new market which is why the report’s findings, showing optimistic suppliers and consumers, are such good news.”
Tom Rowlands-Rees, Head of Energy Smart Technologies at Bloomberg New Energy Finance, said:
“Improving energy efficiency is central to a number of current challenges, such as maintaining economic competitiveness, boosting energy security, creating jobs as well as, of course, tackling climate change. However tracking the state of this nebulous market is notoriously challenging.
“It is therefore very encouraging to see our market report – the first of its kind – showing a trend of increasing optimism. It is our hope that the new analyses introduced this issue will bring further confidence to this emerging sector.”
Ian Jeffries, Head of Information Services at EEVS Insight, said:
“At a time when the UK’s economic recovery is predicted to gather pace, it is pleasing to report that energy efficiency is making its own sustained contribution. Ostensibly a ‘spend to save’ investment proposition, energy efficiency is a great way to cut operational costs and boost productivity.
“Our latest market report shows that UK organisations are very much alive to this and are actively investing in order to drive long term efficiency savings and enhanced competitiveness. This is great news for UK plc.”
The full report can be found on the EEVS website.