Impact of COVID-19 on Global Energy as a Service Market
The energy industry is transforming immensely due to factors such as automation, decarbonization, and decentralization. It is creating new business models to transform efficiently. Nowadays, through the energy as a service (EaaS) business model, energy is being transitioned to be sold as services to the customers. The need for decentralized power generation, energy storage systems, meter services, and energy-saving initiatives have increased the awareness for EaaS to help unlock the demand-side flexibility. EaaS consultants analyze machines and electrical equipment, including HVAC units, compressors, pumps, motors, and others. The analysis is done by deploying smart meters and other technologies such as artificial intelligence and machine learning, providing real-time information.
FIGURE: PRIMARY ENERGY CONSUMPTION IN ASIA (2010 TO 2050)
However, the unexpected COVID-19 outbreak has led to a decline in the growth of the energy industry. The industry witnessed a falling demand and price reduction trend across the world. Various regions are heavily impacted and have recorded all-time low electricity prices in the first quarter of FY’2020, including many European countries. Moreover, due to the severity of this virus attack, many industries are focusing only on essential work. This has led to a pause on electric components installation. Manufacturers of hardware devices for energy services are facing several issues related to order completion due to lockdown orders issued by governments across the globe. For instance, Con Edison (US), has halted all meter reading and installation of smart meters in the US. Moreover, energy as a service market is mainly driven by the rising energy consumption and price volatility. The virus attack has hit the industries, and there has been a steep fall in energy demand. For instance, as per the data released by Power System Operation Corporation, in India, the fall in daily energy consumption has grown from 15% to 26% during the first quarter of 2020. This will have an impact on energy services.
Source: Primary Experts, Secondary Sources, and MRFR Analysis
Source: US Energy Information Administration (EIA), 2019