Dive Brief:
- Global revenues for advanced energy reached $1.4 trillion in 2015, a record high according to a new report produced by Navigant Research for Advanced Energy Economy.
- In the United States, the advanced energy market reached $200 billion – larger than pharmaceutical manufacturing and nearly double the nation’s beer market, AEE pointed out.
- Worldwide, advanced energy revenues grew 8% over 2014, more than three times the rate of the global economy overall. U.S. advanced energy revenue grew 1%, with building efficiency representing 30% of the segment.
Dive Insight:
Ok, so advanced energy is bigger than beer. But is it better? That's a different question.
If the United States 1% growth figure looks a bit paltry, AEE says you can blame low oil prices. Ethanol pricing is “highly correlated” with oil prices, the business group said. “So, while production increased slightly, from 14.3 to 14.7 billion gallons as the federal Renewable Fuel Standard was fulfilled, ethanol revenue dropped 33 percent, from $40.9 billion to $27.3 billion.”
If you pull ethanol out of the advanced energy equation, the market grew at a rate of 10%, according to Navigant's research, or four times the growth of the United States' GDP.
“Advanced energy has made stunning progress over the past five years, reaching new heights both globally and in the U.S.,” AEE CEO Graham Richard said in a statement. “This vital industry is making the energy we use more secure, clean, and affordable, while creating economic growth. AEE and its business members are committed to accelerating this progress by working with state and federal policymakers, as well as the customers who are demanding advanced energy options.”
The U.S. advanced energy market has grown 29% since 2011, and for the second year in a row, building efficiency has led revenues in the advanced energy sector. Building efficiency generated $63.6 billion in revenue last year, up 11% from 2014 and 50% over 2011. Included in the segment are appliance and electronics efficiencies, whole building improvements and lighting, as well as demand response and other energy management technologies.
Electricity generation was the second largest advanced energy segment, at $52.3 billion in 2015, and also experienced the second largest year-on-year growth, at 18%. AEE found solar PV was up 21%, to $22.6 billion, and had nearly tripled since 2011. Wind revenues were up 75%, to $8.2 billion.
Energy storage installations more than doubled in the U.S. last year, and "the sector is poised to hit 10 GW by 2020 globally,” said Kiran Kumaraswamy, market development director at AES Storage. “We expect that energy storage will grow faster than renewable generation as it can act as an alternative for not only peaking generation but also for traditional transmission and distribution investments.”