Home energy management systems to take off in 2014

Shipments of home energy management systems (HEMS) are expected to accelerate rapidly from 2014, according ABI Research.

In its latest report “Home Energy Management Systems”, ABI says HEMS will see moderate growth until the end of 2013 but then will take off until 2016, when nearly 44 million will hit world markets, generating revenues of about US$2bn.

“We see utilities as the largest channel for HEMS going to market,” said Sam Lucero, M2M connectivity practice director with the analyst firm. “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 small, private HEMS vendors. They now face increasing competition from home automation vendors that offer HEMS as one part of their overall product lines.

Competing against the home automation vendors won’t be easy, said Lucero.

“The 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,” he said. “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 specialisation is redundant. They can point to their greater variety of paths to market: retail, service provider, dealer-installer and utility. They can partner directly with the smart grid too,.

“Home Energy Management Systems” analyses 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.

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