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An Economic Force to be Reckoned With – Sustainable Energy in the United States

The recently released Advanced Energy Now 2019 Market Report, produced by Navigant Research for Advanced Energy Economy (AEE), reports that total revenue for advanced energy worldwide reached a record $1.6 trillion in 2018, with nearly $238 billion generated in the United States. 

To help understand what the size of these numbers mean, AEE offers a helpful context by comparing the energy sector with industries that the everyday consumer is more familiar with. For example, the global revenue for advanced energy is equal to that of global tourism. 

And in the U.S., advanced energy is now nearly equal in revenue to aerospace manufacturing, and twice the revenue of the biotech industry. 

These numbers demonstrate that sustainable energy sectors including energy efficiency, renewable energy and natural gas are an economic force to be reckoned with, both here in the U.S. and around the world.

AEE and Navigant have been tracking revenue for seven different business segments since 2011, enabling them to highlight compounded annual growth rates (CAGR) for these segments, which include building efficiency, electricity generation, electricity delivery and management, fuel delivery, fuel production, industry and transportation.  These rates of growth also demonstrate expansion of investment and consumer demand for clean energy solutions.  Since 2011, U.S. advanced energy revenue has grown at a compound annual rate of 8%.  In 2018, the year-on-year growth rate was 11%, nearly 4 times that of the U.S. gross domestic product.

To highlight a few headlines from the report on the U.S. market:

  • Building efficiency was the largest segment of U.S. advanced energy revenue with a total of $83.1 billion, up 10% over 2017, and 11% CAGR since 2011. This industry segment accounts for improved building envelope, appliance and electronics, and lighting as well as managing energy use with demand response and other enabling information technologies.
  • Advanced transportation experienced the largest increase ($7.9 billion) and the fastest growth (34%) of any U.S. advanced energy segment in 2018, reaching $31.3 billion. Revenue from sales of plug-in electric vehicles (EVs) rose 75% to $18 billion.
  • In advanced electricity generation, revenue from solar photovoltaics was up 8% in 2018 to $24.2 billion. With a continuing drop in unit prices, installations of solar PV increased 14%. Revenue from wind installations was up 23% ($14 billion), after dip of 19% ($11.4 billion) in 2017. Combined cycle gas turbines also had relatively strong years in 2017 and 2018 – $12.9 billion and $13.2 billion respectively, up from $8 billion in 2016.
  • In electricity delivery and management, notable growth occurred in EV charging infrastructure, with revenue up 23% to $280 million. Energy storage revenue was up 18%, reaching $701 million, after even faster growth in 2016 (54%) and 2017 (39%).

Here at the Business Council for Sustainable Energy we know that these clean energy sectors are the growth sectors of the economy, the job-creators and the backbone of our energy economy.  We concur with AEE’s definition that “advanced energy is not static but dynamic, as innovation and competition produce better energy technologies, products, and services over time.”  Watch this space as the evolution of the energy sector is well underway.