Demand for commercial building electrification has been growing over the past decade as organizations aim to reduce their carbon footprint and become more energy efficient. By electrifying systems such as HVAC, water heating, and cooking, building owners and organizations have been able to achieve benefits such as increased energy efficiency, reduced carbon emissions, and safer buildings.
According to a new report from Guidehouse Insights, revenue attributed to commercial building electrification is expected to increase from $91.3 billion in 2024 to $145.3 billion in 2033 at a compound annual growth rate (CAGR) of 5.3%.
“As buildings transition away from traditional fossil fuel energy sources, adopting electric systems is becoming increasingly essential for achieving sustainability goals and reducing operational expenses,” said Krystal Maxwell, research director with Guidehouse Insights. “The increased availability of renewable energy has made building electrification more desirable. Servicing fully electrified buildings with renewable energy can allow building and business owners to claim that their buildings generate zero emissions.”
Commercial building electrification has accelerated in recent years due to the need to increase energy efficiency, improve sustainability, and comply with regulations, as well as available incentives and the desire for energy resilience. However, market growth is limited by high product and installation costs, the complexity of new technologies, and the need to pair building electrification with renewable energy sources to fully realize the benefits of electrification, according to the report.
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