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HEMS a $2 billion business by 2016

Posted: 23 Mar 2011 ?? ?Print Version ?Bookmark and Share

Keywords:energy management? HEMS? smart meters?

ABI Research predicts moderate growth for home energy management systems (HEMS) until 2013. The research firm, however, foresees global HEMS shipments rapidly increasing starting 2014, and totaling nearly 44 million units and generating revenue of approximately $2 billion by 2016.

Sam Lucero, M2M connectivity practice director with the analyst firm, explains: "We see utilities as the largest channel for HEMS going to market. Utilities have been focusing their efforts on smart meter deployments. But in the next few years, HEMS will ramp up to deliver the utilities 'demand response' benefits on top of their smart meters. This trend will start to have real impact in 2014."

Utilities will not be making HEMS systems themselves. Two groups of vendors provide the actual systems, although the consumer may only deal directly with the utility. One of these groups is made up of small private HEMS vendors who are facing increasing competition from home automation vendors that offer HEMS as part of their overall product lineups.

Competing against the home automation vendors won't be easy, says Lucero. He stresses that "pure-play HEMS vendors should differentiate their offerings to focus on the specific needs of utilities, tying their systems effectively into the utilities' back-end operations. They should also form close relationships and partnerships with the smart grid value chain, and demonstrate a level of vertical energy market expertise that impresses the utilities more than do the home automation vendors."

The home automation vendors are likely to counter that homeowners are already using their systems (or soon will be) and that further specialization is redundant. They can point to their greater variety of paths to market: retail, service provider, dealer-installer and utility. They can also partner directly with smart grids, in the way that Control4 has partnered with Silver Spring Networks.

The "Home Energy Management Systems" study analyzes each of the key market segments, their market adoption drivers and challenges, significant competitive landscape trends and the major technological issues facing the market. It profiles key players, and provides five-year unit shipment and revenue forecasts. It is part of two ABI Research Services: Energy and Clean Technology and Home Automation Systems.

- Julien Happich
??EE Times

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