China Energy Conservation Service Industry Report, 2015
Energy conservation service industry provides service and support for enterprises and projects in terms of energy conservation and emission reduction. An Energy Service Company, more commonly referred to as an ESCO, is a company that provides/installs and manages a suite of comprehensive energy solutions for a client company which reduces the energy expenses and greenhouse gas emissions for the client. Main business models for an ESCO to carry out energy saving business are Energy Management Contracting (EMC) / Energy Performance Contracting (EPC), etc, involving Shared Savings, Guaranteed Savings, Chauffage, etc.
By the end of 2014, there were 5,125 energy conservation service companies and 562,000 practitioners in China, up 5.6% and 10.6% respectively on a year-on-year basis. In 2014, China’s energy conservation service industry created output value of RMB265.037 billion, up 23.0% year-on-year (annual growth of 30% or over during 2007-2013)
With respect to business models, EMC occupies an important position, seeing investment up 29.2% year-on-year to RMB95.876 billion, making up 36.2% of the industry’s output value. Concerning specific ways, shared savings dominates the market. Restricted by capital of energy conservation service companies, guaranteed savings and chauffage are expected to see a larger proportion of EMC investment in the future. At the same time, along with China’s implementation of the reform that allows social capital to participate in the urban infrastructure investment and operations through franchise and other ways, PPP mode (participation from energy conservation service companies, social capital and government) energy conservation service will possibly become dominant in infrastructure and public utilities.
At present, China’s energy conservation service applications are mainly found in industrial sectors (about 70% of the total energy consumption in the country), whose energy conservation service output value makes up more than 70% of the industry-wide output value. In the industrial field, energy conservation services are mainly concentrated in recycling of waste heat / residual pressure, energy-saving of motor system, optimization of energy system, improvement of furnace / boiler, etc. Besides, construction, transportation and other fields also have great energy saving potentials e.g. China’s existing building energy-saving renovation market potential reached RMB4.434 trillion by the end of 2014.
Because of small assets scale and difficult financing, services provided by Chinese energy conservation service companies are mainly single energy conservation types with small amount of investment. However, with the expansion of financing channels and improvement of professional skill, an integrated solution covering energy saving, environmental protection and intellectualization for systems (including heating system, air conditioning and refrigeration system, lighting system, ventilation and air exchange system, water system and other subsystems) will become a trend.
China Energy Conservation Service Industry Report, 2015 mainly covers the following: Overview of energy conservation service industry, including definition, business model, EMC comparison between China and the US, PPP mode, etc.; Operation of energy conservation service industry, including relevant policies, number of enterprises and employees, industry output value, EMC investment, applications, competition pattern, etc.; Energy conservation service market segments, including status, market size, competition pattern, prospects, etc. of waste heat power generation / motor energy saving / building energy saving; 17 major players, including their profile, operating performance, revenue structure, gross margin, energy conservation services, development strategy, etc.
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