Having a full and effective solution of energy management and improvement of the current energy management is a major concern to the civil engineers and entrepreneurs. Energy as a Service Companies have addressed these challenges by subcontracting third parties to provide sustainable and cost-effective utilities. These customers advance low carbon technologies and pay for the energy. Energy as a Service has the potential to assist in the decarbonization and creation of distributed, electrified energy systems that serve, in particular, the highly populated areas, which urban areas in highly populated areas.
How the Energy as a Service Model Works
Traditional utility contracts get complex and cumbersome because of the bureaucracy, risk management, maintenance and other factors due to the inefficiency of utility contracts. These challenges are eliminated based on the energy as a service companies’ pay-for-performance model. Providers are responsible for sustaining, owning and paying for the equipment. Customers enter structured contracts that pay for the services successfully rendered. Reducing risk from contracts is characterized to EaaS as outsourcing ownership and management of the provision of the assets and systems with appropriate flexible contracts to enable advancement and scaling of the systems.
According to GMI Research, the Energy as a Service Market size is estimated to reach US USD 139.6 billion in 2030
What are the Benefits of EaaS?
EaaS providers have an innovative way of Energy Infrastructure and Service Management.In particular, it is a sustainable model that implements the latest innovations and projects to the further optimize resource consumption and distribution. These contractors solve the following challenges:
- Performance Risks. Energy as a service companies legally and logically hold the responsibility to the sustainability disclosures requirements. Having the ownership of the infrastructure and the energy assets, the service providers control all the end-to-end risks.
- Management and Installation. Well-established traditional models do not have clear systems for delegating maintenance work, as well as the control of maintenance costs. On the other hand, EaaS providers receive payments, and while exercising to control all the necessary actions, they have to meet contractual obligations within the service quality.
- Service Payment. Energy as a service companies have reduced costs and eliminated most bureaucratic burdens on the customer by substituting advance payments with pay-for-performance, while improving the infrastructure planning and scaling, and operational control by the provider.
- Energy Equipment Solutions. The energy as a Service market offers innovative and highly scalable models for businesses and clients, and further includes customized and advanced technologies. Providers offer the complete range of energy services with differentiated products because of the intense competition on the EaaS market, including quality energy service provision and advanced digital energy management platforms.
Some examples of Energy as a Service projects include: Energy outsourcing includes niche services that are tailored to particular requirements and customer types.
Therefore, there are various market players in EaaS because each of them focuses on different problems that commercial or industrial businesses face. Some of these service projects are as follows:
- Energy Storage Solutions. One of the most offered solutions in EaaS is the provision of battery storage systems that customers use. When customers utilize these systems, the providers capture and monetize stored energy, and are responsible for the installation, maintenance, and management of the battery storage systems.
- Solar Energy Services. This service provision model includes the most advanced solar energy generation technologies. Customers pay for the consumed electricity, and the service providers take care of the installation and maintenance of the systems.
How Energy as a Service Helps in the Adoption of Renewables
In most cases, energy as a service providers incorporate environmentally sustainable offerings as part of their distinct differing strategy. This is because the conventional energy systems are both outdated and lack the ability to comply with the sustainability requirements. Therefore, modernizing their systems is usually an expensive undertaking for organizations. For these types of problems, the energy as a service business model offers a scalable and sustainable solution as it puts renewable energy at the forefront.
