March 28, 2024

Outlook for the Energy Efficiency Industry
Guest Editorial 2

by Albert Thumann, PE, CEM
Since 1977, when the Association of Energy Engineers (AEE) was founded, energy efficiency has been a growth market regardless of which party occupies the White House. Demand for energy efficiency professionals also continues to grow. Over the last five years, even as the US economy was in turmoil, the AEE’s membership has doubled to 16,000.

In 2012, the association conducted a survey of our members for additional insights into demand for energy efficiency, professional education and training programs, and trends in the industry. The survey found the following:

a) Growing shortage of energy engineering professionals
Sixty-seven percent of survey respondents predicted a shortage of qualified professionals in the energy efficiency and renewable energy fields in the next five years. Contributing to this is the fact that nearly a third (32 percent) of those surveyed say they plan to retire in the next 10 years.

AEE works with numerous colleges and universities to encourage students to enter the energy engineering profession, and our foundation provides a scholarship program for energy engineering students. However, despite the growth in demand for energy efficiency professionals, there are few degree programs related specifically to energy engineering and management, which may contribute further to a shortage of qualified energy engineers in the years ahead. A recent survey by AEE indicated that education for a degree in energy engineering was offered by the following colleges and universities:

  • Arizona State University – solar energy engineering and commercialization graduate program
  • Boston University – energy technologies
  • Lehigh University (Pennsylvania) – environmental/energy engineering
  • Indiana University-Purdue University Indianapolis – energy engineering
  • Oregon State University – energy systems engineering
  • Oregon Tech – renewable energy engineering, Master of Science in renewable energy engineering
  • Penn State – energy engineering
  • Princeton University (New Jersey) – sustainable energy
  • University of California, Berkeley – energy engineering
  • University of Illinois at Chicago – energy engineering; Master of Energy Engineering
  • University of Michigan – energy systems engineering; Master of Engineering in energy systems engineering
  • University of North Texas – mechanical and energy engineering

b) Growth in the clean energy marketplace
Clean energy from energy efficient technologies, renewable and alternative energy sources will continue to increase. The Center for American Progress predicts that by 2020 clean energy will be one of the world’s biggest industries, worth as much as US$2.3 trillion. Business researchers Frost & Sullivan project the revenue from energy management services in North America alone will grow to more US$40 billion in 2013. There are several factors that contribute to this growth.

The market for energy efficiency continues to be driven largely by businesses’ desire to increase profits by reducing costs – and energy is a major component of most businesses’ overhead costs. In fact, 69 percent of those surveyed by AEE indicated that electric rates have increased since last year, while even more (88 percent) said their company has a sustainable development policy and energy efficiency is a component.

However, as energy costs increase, the cost of renewable energy continues to become more economical, leading more businesses to adopt renewable energy technologies. The AEE survey found that 73 percent of respondents plan to install photovoltaic (PV) systems at their facility in the next three years, while 30 percent plan to install geothermal in the same time period.

Another factor impacting the adoption of clean energy technologies is changing energy policies. For example, both Germany and Japan are working to phase out nuclear power. While some of this capacity will likely be replaced with newly abundant natural gas, renewable energy and energy efficiency will be increasingly important to meeting demand in these nations, and in nations around the world.

Conclusion
The clean energy industry is poised for continued growth and has the potential to outperform other sectors. The cost of energy efficient technologies, even without tax deductions, credits and utility rebates, continues to become more affordable and economically viable. In addition, with retirements among current energy engineering professionals and a steady increase in demand for energy efficiency, the sector may also anticipate tremendous growth both in employment and in demand for quality education and training programs.
 

About the Author

Albert Thumann founded the Association of Energy Engineers in 1977 and has served as its executive director ever since. He has personally trained more than 8,000 professionals on the efficient use of energy and has lectured around the world on energy topics. Thumann is a licensed professional engineer in three states and Certified Energy Manager (CEM). He received a Bachelor of Science in Electrical Engineering (BSEE) from City University of New York, and a Master of Science in Electrical Engineering (MSEE) and a Master of Science in Industrial Engineering (MSIE) from New York University.