Energy Retrofit Systems Market size is anticipated to surpass USD 329 Billion by the end of 2036, growing at a CAGR of 6% during the forecast period, i.e., 2024-2036. In the year 2023, the industry size of energy retrofit systems was over USD 150 Billion. The use of HVAC equipment in more industries is anticipated to fuel market expansion. Most HVAC and lighting technologies have a 25-year lifespan after which they must be replaced as they are no longer deemed to be effective. As per a survey, the average cost of installation of HVAC in New York was around 74% greater than the average cost in the 30 major U.S. cities put together. Energy costs for homes and businesses are significantly reduced by retrofitting these systems.
In response to the Kyoto Protocol and other analogous objectives established by international directives or norms, the majority of developed nations are gradually implementing energy-efficiency measures into their construction codes and standards. Over the past ten years, these have become more popular in developing countries like China, Mexico, India, and Singapore. These advantages of policy and incentive schemes are expected to drive the market.
Growth Drivers
Challenges
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Base Year |
2023 |
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Forecast Year |
2024-2036 |
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CAGR |
~ 6% |
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Base Year Market Size (2023) |
~ USD 150 Billion |
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Forecast Year Market Size (2036) |
~ USD 329 Billion |
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Regional Scope |
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Product (Envelope, LED Retrofit Lighting, HVAC Retrofit, Appliances)
Energy retrofit systems market from the envelope segment is expected to hold the largest share of 42% during the forecast period. Retrofitting the building envelope promotes thermal comfort and minimizes drafts through the addition of insulation and an air barrier to the walls. Less heat is lost as a result, which reduces energy consumption and lowers carbon footprints for both owners and tenants. Additionally, research found that envelope retrofitting has the ability to help the benchmark home's energy use drop by about 30%. Therefore, displaying a dedication to environmental sustainability, will also positively affect public impression.
Application (Residential, Commercial, Institutional)
The commercial segment is expected to hold 52% share of the global energy retrofit systems market by 2036. The market is growing due to a growing demand for easy facility management, process efficiency, and effective labor mobility, office buildings generate the most revenue among non-residential buildings. In 2020, the market for commercial real estate was projected to be close to USD 33 trillion dollars, with over USD 10 trillion anticipated for each of the areas of EMEA, Asia Pacific, and North America. Businesses can incorporate flexibility in process operations and interact with their staff and other operational branches by implementing energy retrofit systems in office buildings. The non-residential market is therefore anticipated to grow at a faster rate than the focused market throughout the projected period as a result of the use of energy retrofit technologies.
Our in-depth analysis of the global market includes the following segments:
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Product |
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Appliances |
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European Market Forecast
Europe energy retrofit systems market is expected to hold the largest share of 37% by the end of 2036. The expansion can be attributed to the region's rising environmental concerns. For instance, the European Commission introduced the Renovation Wave initiative, which aims to decrease energy poverty, improve quality of life, and cut emissions by expediting house renovations across the EU. Moreover, the remodelling wave plan would enhance the health and wellbeing of residents because energy-efficient buildings make people more susceptible to cold snaps and heat waves. In the next 10 years, the strategy wants to double the rate of energy renovation, which will result in greatly increased energy and resource efficiency. By 2030, 35 million structures, according to the commission, might be renovated.
APAC Market Statistics
The energy retrofit systems market in Asia Pacific is anticipated to hold a share of 26% during the forecast period. End users in the residential and commercial sectors across Asia Pacific are encouraged to embrace energy modernization systems quickly by the region's lower cost of infrastructure and lower cost of renewable energy. The Chinese government adopted many plans and policies, including a three-star rating system, to encourage the construction of new ecologically friendly green buildings and the repair of existing ones around the country. In ten years, the national government has logically expanded the scope of laws and regulations. These energy building codes lay out the specifications that must be followed when brand-new homes and other buildings are constructed in China's cities.
Author Credits: Payel Roy, Dhruv Bhatia
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