NEW YORK — Global spending on energy management by large corporations will increase or remain flat in 2014 with just 6 percent of corporations expected to spend less, according to a new global survey from independent analyst firm Verdantix. The firm said its annual survey of 250 heads of energy in 13 countries and 20 industries identifies new directions in corporate spending on renewable energy, HVAC, lighting, building technologies, energy software, and energy services.

“On a worldwide basis, 45 percent of corporations will spend more on energy management in 2014 than they did in 2013,” said Janet Lin, Verdantix Energy Practice research director. “Reflecting the downward pressure on natural gas and electricity prices and subdued economic growth, nearly 50 percent of corporations will keep energy management spend flat. Prominent suppliers such as DNV KEMA, Ecova, Rockwell Automation, and Siemens Building Technologies will benefit from increased customer spend if major economies gather momentum through the year.”

The Verdantix report, “The State of Global Corporate Energy Management,” provides insights into corporate budgets for energy management, buying processes, and focus areas for investment in 2014. Key findings are:

• 46 percent of corporations have implemented a global energy management strategy with centralized governance while 54 percent manage decisions at a division or facility level.

• Utility bill management is the most outsourced activity with 25 percent of corporations using this service, while 21 percent outsource risk management and 19 percent energy data analytics.

• Spend on energy management is on average 10 percent of total spend on energy procurement with significant variations by industry.

• 33 percent identify compliance with legislation as the most important factor and 32 percent of respondents rank cost savings as the primary driver for spending.

• Energy leaders rate CFO hurdle rates, a lack of quantifiable benefits, and insufficient cost savings as the primary barriers to investing in energy management.

“Our data show that energy leaders in Brazil, Germany, South Africa, and the U.S. face different risks and opportunities depending on price trends, market deregulation, and investment incentives,” said Lin. “Installation of on-site power generation varies enormously by country and industry. By contrast better energy data management is the most entrenched spending theme. Ninety-six per cent of 250 corporations believe they need to enhance the volume, quality, and frequency of energy data collection and reporting. This is a shot in the arm for a diverse group of energy software innovators such as DEXMA, Envizi, IMServ, Joulex, Panoramic Power, and Urjanet. ”

Publication date: 9/23/2013