Smart Demand Response Global Market Report 2024

The smart demand response market size has grown rapidly in recent years. It will grow from $27.13 billion in 2023 to $31.4 billion in 2024 at a compound annual growth rate (CAGR) of 15.7%. The growth observed in the historic period can be attributed to factors such as energy policy and regulation, concerns related to grid reliability, increasing environmental awareness, the implementation of pilot programs and demonstrations, and energy price volatility.

The smart demand response market size is expected to see rapid growth in the next few years. It will grow to $52.62 billion in 2028 at a compound annual growth rate (CAGR) of 13.8%. The anticipated growth in the forecast period can be attributed to factors such as the integration of renewable energy, policy support and incentives for sustainable practices, increased adoption of electric vehicles, efforts towards resilience and grid modernization, and the integration of energy storage solutions. Major trends expected in the forecast period include digitalization and the Internet of Things (IoT), technological advancements in the energy sector, initiatives focused on grid modernization, the implementation of dynamic pricing models, and the expansion of IoT and smart devices in the energy landscape.

The anticipated surge in energy costs is projected to drive the expansion of the smart demand response market in the future. Energy costs encompass the expenditures linked to acquiring and utilizing diverse forms of energy, such as electricity, fuel oil, gasoline, heating oil, and natural gas. The swift escalation in energy costs contributes to the growth of smart demand response, creating a financial incentive for consumers and businesses to actively engage in demand response (DR) programs. For instance, in February 2021, as reported by the Office for National Statistics, a UK-based intergovernmental organization, 25 energy suppliers faced closure, with one entering administration, primarily due to substantial increases in wholesale energy prices. Additionally, consumer prices for gas and electricity experienced a noteworthy uptick of 17.1% in 2021. Consequently, the rapid surge in energy costs is steering the expansion of the smart demand response market.

The mounting power demand is set to propel the advancement of the smart demand response market in the coming years. Power demand denotes the total electrical energy required by consumers at a specific point in time, measured in kilowatts (kW) or megawatts (MW). Smart demand response plays a pivotal role in managing power demand by dynamically adjusting electricity consumption in response to real-time grid conditions and pricing signals. For example, in December 2023, according to the Energy Information Administration, a US-based government agency, the United States recorded a total electricity consumption of approximately 4.07 trillion kWh in 2022, marking a 3.2% increase compared to the previous year, 2021. Hence, the escalating power demand is propelling the growth of the smart demand response market.

Major companies are actively engaged in the development of innovative solutions, particularly those focused on grid-balancing in the smart demand response market. Grid-balancing involves the deployment of technologies and strategies to optimize the equilibrium between electricity supply and demand on the power grid, ensuring its stability and reliability. For example, in June 2022, CPower Energy, a US-based energy solutions provider, rolled out four nationwide demand response programs. These initiatives are intended to capitalize on the company's ongoing efforts in delivering grid-balancing solutions, especially during the summer season. The demand response programs incentivize energy users to curtail their energy consumption during peak usage periods.

Prominent players in the smart demand response market are increasingly concentrating on introducing new products optimized for the electric grid to enhance their market profitability. Electric grid-optimized products in the context of smart demand response encompass technologies and services designed to intelligently manage and adjust electricity consumption in real-time based on demand fluctuations, thereby improving efficiency and reliability. For instance, in September 2022, Rheem Manufacturing Company, a US-based manufacturer of water heaters and ventilators, launched a demand-response-enabled smart electric water heater. Engineered to meet stringent energy standards, this water heater seamlessly integrates with the power grid. With a UEF of up to 93, the product proves to be an energy-efficient choice for residents seeking to lower their energy expenses. The water heater is equipped with features such as built-in demand response capabilities, scheduled operation based on time-of-use, real-time energy consumption tracking, and advanced EcoNet Wi-Fi technology.

In October 2022, CPower, a leading US-based national energy solutions provider, successfully acquired Centrica Business Solutions LLC for an undisclosed sum. This strategic acquisition propelled CPower's distributed energy resource (DER) capacity from 5.6 GW to 6.3 GW, cementing its position as a premier national player harnessing the potential of distributed energy resources. Centrica Business Solutions LLC, a US-based integrated energy solutions company, specializes in providing energy management solutions to commercial and industrial organizations.

Major companies operating in the smart demand response market report are Enel S.p.A., Hitachi Ltd., Siemens AG, General Electric Company, Cisco Systems Inc., Oracle Corporation, Mitsubishi Electric Corporation, Schneider Electric SE, Honeywell International Inc., ABB Ltd., Johnson Controls, Toshiba Corp, Eaton Corporation PLC, Con Edison Solutions, Itron Inc., Landis+Gyr, Aclara, EnerNOC, LS Power Development LLC, Opower Inc., Comverge Inc., GridPoint, Uplight, Bidgely, Echelon Corporation, AutoGrid, Blue Pillar, Virtual Peaker, Axiom Exergy, Powerley.

Asia-Pacific was the largest region in the smart demand response market in 2023. The regions covered in the smart demand response market report are Asia-Pacific, Western Europe, Eastern Europe, North America, South America, Middle East, Africa. The countries covered in the smart demand response market report are Australia, Brazil, China, France, Germany, India, Indonesia, Japan, Russia, South Korea, UK, USA, Canada, Italy, Spain.

Smart demand response is a technology-driven approach aimed at managing electricity consumption in response to changes in the supply-demand balance within the power grid. This approach is crucial for reducing peak demand, balancing the power grid, and improving overall energy efficiency.

The main types of smart demand response include voluntary demand response and contractual mandatory demand response. Voluntary demand response involves a strategy where electricity consumers willingly adjust their electricity consumption patterns in response to signals or incentives provided by the grid operator or utility company. The technologies associated with smart demand response include automated demand response, direct load control, and dynamic pricing. These technologies find applications in residential, commercial, and industrial settings.

The smart demand response market research report is one of a series of new reports that provides smart demand response market statistics, including smart demand response industry global market size, regional shares, competitors with smart demand response market share, detailed smart demand response market segments, market trends, and opportunities, and any further data you may need to thrive in the smart demand response industry. This smart demand response market research report delivers a complete perspective of everything you need, with an in-depth analysis of the current and future scenarios of the industry.

The smart demand response market includes revenues earned by entities through peak load management, load shifting, grid balancing, data analytics, and predictive modeling. The market value includes the value of related goods sold by the service provider or included within the service offering. The smart demand response market consists of sales of smart thermostats, smart appliances, and home energy management systems. Values in this market are ‘factory gate’ values, that is the value of goods sold by the manufacturers or creators of the goods, whether to other entities (including downstream manufacturers, wholesalers, distributors and retailers) or directly to end customers. The value of goods in this market includes related services sold by the creators of the goods.

The market value is defined as the revenues that enterprises gain from the sale of goods and/or services within the specified market and geography through sales, grants, or donations in terms of the currency (in USD unless otherwise specified).

The revenues for a specified geography are consumption values that are revenues generated by organizations in the specified geography within the market, irrespective of where they are produced. It does not include revenues from resales along the supply chain, either further along the supply chain or as part of other products.


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