Energy Retrofit Systems Market Size & Share by Product (Envelope, LED Retrofit Lighting, HVAC Retrofit); Application (Residential, Commercial, Institutional) - Global Supply & Demand Analysis, Growth Forecasts, Statistics Report 2024-2036

  • Report ID: 5357
  • Published Date: Nov 01, 2023
  • Report Format: PDF, PPT

Global Market Size, Forecast, and Trend Highlights Over 2024-2036

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.

Energy Retrofit Systems Market
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Energy Retrofit Systems Sector: Growth Drivers and Challenges

Growth Drivers

  • Implementation of Energy Retrofit Systems to Achieve Sustainable Building Goals – These systems are extensively used in the construction sector in order to enhance the energy performance of the structure, which results in lower consumption of land energy and also decreases the reliance on constructing new buildings. Adopting these solutions could also contribute to the preservation of older structures while maintaining the best possible thermal comfort for the occupants, which boosts productivity. Also, energy management systems have gained popularity as they reduce costs and increase productivity. These factors are driving the energy retrofit systems market rapidly.
  • Increasing Concerns about Energy Efficiency – Energy is a major input for the building sector, and it is crucial for sustainability and energy efficiency. The majority of energy is used by the construction industry. The majority of energy is used by the construction industry. Energy retrofit systems represent an opportunity to upgrade the energy performance of any commercial building’s assets for their ongoing life and also help in improving energy efficiency or decreasing energy demand. Additionally, installing distributed power in a building is a great opportunity provided by energy retrofit systems. According to one study, reducing energy use countrywide by 15% for a year through efficiency measures might help save six American lives every day and prevent up to USD 20 billion in health-related issues.
  • Increasing Consumption of Energy Globally – Due to the fast rise in energy consumption, energy is employed in a variety of sectors. In the commercial sector, district heating services consume the most energy. There will be an increase in electricity demand in the commercial sector as a result of many current technologies employed to generate power from renewable sources As a result of an increase in the demand for energy consumption internationally, the power industry has seen the emergence of new business models thanks to the rising installation of energy systems and the widespread availability of smart devices. Therefore, the growing consumption of energy is also driving the market growth.


  • Lack of infrastructure and Information– The current energy efficiency gap is a result of the irrational behavioural habits of residential consumers. Numerous studies have looked into how the energy efficiency gap between investment prospects and actual implementation slows the market growth for energy retrofit systems. Structure changes present further difficulties for the market for energy retrofits. Energy retrofit systems could damage historical and archaeological resources because they use untested techniques, tools, or technologies.
  • Increased Secret Fees and Prolonged Reimbursement Periods May Restraint the Market Growth
  • High Initial Costs Associated with the Energy Retrofit Systems

Energy Retrofit Systems Market: Key Insights

Base Year


Forecast Year



~ 6%

Base Year Market Size (2023)

 ~ USD 150 Billion

Forecast Year Market Size (2036)

 ~ USD 329 Billion

Regional Scope

  • North America (U.S., and Canada)
  • Latin America (Mexico, Argentina, Rest of Latin America)
  • Asia-Pacific (Japan, China, India, Indonesia, Malaysia, Australia, Rest of Asia-Pacific)
  • Europe (U.K., Germany, France, Italy, Spain, Russia, NORDIC, Rest of Europe)
  • Middle East and Africa (Israel, GCC North Africa, South Africa, Rest of the Middle East and Africa)
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Energy Retrofit Systems Segmentation

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:


  • Envelope
  • LED Retrofit Lighting
  • HVAC Retrofit
  • Appliances


  • Residential
  • Commercial
  • Institutional

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Energy Retrofit Systems Industry - Regional Synopsis

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.

Research Nester
Energy Retrofit Systems Market Size
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Companies Dominating the Energy Retrofit Systems Landscape

    • Orion Energy Systems Inc
      • Company Overview
      • Business Strategy
      • Key Product Offerings
      • Financial Performance
      • Key Performance Indicators
      • Risk Analysis
      • Recent Development
      • Regional Presence
      • SWOT Analysis
    • Trane Technologies
    • Ameresco Inc
    • Johnson Controls International Plc
    • AECOM
    • ZMP INC.

In the News

  • ewport News Public Schools (NNPS) contacted Ameresco for a performance-based energy services contract as a result of seriously deteriorating HVAC systems. The performance contract served as a launchpad for NNPS's district-wide dedication to responsible environmental management. Ameresco and NNPS collaborated to create a plan that used the money saved on energy bills to pay for a number of infrastructure repair projects.
  • The Building Efficiency Targeting Tool for Energy Retrofits (BETTER) has been made public by Johnson Controls (NYSE:JCI) and Lawrence Berkeley National Laboratory (Berkeley Lab). Building owners and managers may quickly transform easily accessible monthly building energy consumption data into tailored recommendations for improvement using the simple-to-use, open source BETTER application. It is more crucialthan ever to create a secure environment in classrooms, workplaces, and public spaces in this historic era of a worldwide pandemic.

Author Credits:  Dhruv Bhatia

  • Report ID: 5357
  • Published Date: Nov 01, 2023
  • Report Format: PDF, PPT

Frequently Asked Questions (FAQ)

Increasing consumption of energy globally and increasing concerns about energy efficiency are some of the factors driving the market growth.

The market size of energy retrofit systems is anticipated to attain a CAGR of 6% over the forecast period, i.e., 2024-2036.

The major players in the market are Orion Energy Systems Inc., Trane Technologies, Ameresco Inc, Johnson Controls International Plc, AECOM, ZMP INC., Panasonic Corporation, Hitachi Ltd, Toho Gas Co. Ltd, Denso Corporation and others.

The commercial segment is anticipated to garner the largest market size by the end of 2036 and display significant growth opportunities.

The market in the Europe region is projected to hold the largest market share by the end of 2036 and provide more business opportunities in the future.
Energy Retrofit Systems Market Report Scope

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