By Umair Irfan
The United States commanded a 15 percent share of the $1.3 trillion global market for advanced energy systems in 2014, with revenue in this sector growing at five times the rate as the economy as a whole, according to a report, released yesterday.
Commissioned by Advanced Energy Economy, a business consortium, the report found that the market for companies developing low-carbon generation, renewable power, energy efficiency and electricity analytics is growing worldwide, spurred by economic recovery, maturing technology and policy.
In the United States, the market for advanced energy in terms of revenue almost reached $200 billion in 2014, not including exports. The figure rivals the size of the American pharmaceutical industry. Part of it stems from a resurgence of wind energy, growing to $8.2 billion, following a slump to $2.1 billion in 2013 in the wake of wavering tax incentives.
“2015 is also looking like a healthy year for our business,” said Susan Reilly, president of renewable energy developer RES Americas, on a conference call yesterday announcing the release of the report.
Low natural gas prices increased sales of turbines 48 percent last year compared to 2013, to $6.4 billion, and revenue for photovoltaics blossomed to $22.5 billion.
However, the largest driver was doing more with less in the built environment. “Building efficiency is now our biggest advanced energy sector in the United States,” said Graham Richard, CEO of Advanced Energy Economy.
Lighting upgrades, tighter insulation and smarter thermostats added up to $60.1 billion in revenue in 2014. New technology was an important driver. “LED indoor lighting has come of age,” said John Pouland, vice president for government affairs at Philips Electronics.
Despite the boom, regulations and incentives remain annoyingly uncertain for advanced energy developers. Richards described the Obama administration’s Clean Power Plan as “a historic opportunity to modernize our electricity system for the 21st century.”
However, he said that his group is hoping for stable tax policy that is agnostic about the technology used to meet its objectives, fearful of another legislative showdown like what happened with the production tax credit for wind energy. “Policy helps drive the growth of our markets,” he said.
Copyright 2015, Environment and Energy Publishing LLC. Reprinted with permission.