Dive Brief:

• A new report from the Lawrence Berkeley National Laboratory (Berkeley Lab) has found that the combined revenue growth rates of U.S. energy service companies (ESCO) greatly eclipsed the growth of U.S. gross domestic product (GDP) from 2009 to 2011.
• "Despite the recession, [the U.S. ESCO industry] continued to grow about 9% per year from 2009 to 2011,” said Elizabeth Stuart, a researcher at Berkeley Lab and lead author of the report.
• “We anticipate that U.S. ESCO industry revenues could double in size between today and 2020. Based on historical trends, it is possible that the industry could grow 8% to 12% annually depending on a number of scenarios—potentially achieving revenues of more than $15 billion in 2020, ” said Peter Larsen, an economist at Berkeley Lab and co-author of the report.

Dive Insight:

The rise of the ESCO industry sounds like another worry for utilities. The ESCO industry currently saves U.S. utility customers $4 billion per year, according to Berkeley Lab. The industry's revenue growth eats into traditional utility revenue streams as ESCOs reduce energy consumption and facilitate customers' use of distribution generation resources. Utilities could, however, look into partnering with ESCOs as they look to evolve their business models. ESCOs will undoubtedly find value in utilities' customer relationships.