MUSH market to drive ESCOs through 2020


The U.S. energy service company (ESCO) market has experienced slow growth over the last two years, but is expected to rebound, resuming its expansion in primary markets including K-12 schools, state and local governments, universities and colleges, and hospitals, according to Navigant Research. In fact, education - combining K-12 and universities/colleges - will be the largest market segment for ESCOs, representing more than $22 billion in cumulative revenue from 2013 through 2020, Navigant forecasts.

Credit: Discol/Wikimedia Commons

Credit: Discol/Wikimedia Commons

"The ESCO market continues to be concentrated in municipalities, universities, schools, and hospitals, known as the 'MUSH' market," said Eric Bloom, senior research analyst with Navigant Research. "K-12 schools, which present the largest opportunity for ESCOs, are designed to last for many decades, and many public school buildings in operation today are characterized by out-of-date HVAC, lighting, and control systems that could benefit considerably from system upgrades."

For facility managers, school boards, mayors' offices, and other K-12 stakeholders, energy is rarely the chief concern with other priorities, such as teacher salaries and curriculum development, commanding more attention than energy-related matters. As a result, many ESCOs find that success in the K-12 sector involves the ability to address a wide range of concerns that go beyond energy in facilities, such as replacing roofs and facades and upgrading interior furnishings, according to the report.

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