Verdantix Says Energy Management Software Apps Will Only Deliver Value When Buyers Overcome Huge Integration Challenges

Printer-friendly versionPDF version

New York, USA. September 28, 2011.Energy, facilities and sustainability leaders charged with cutting energy costs, optimizing enterprise energy efficiency and reporting GHG emissions face a huge technology integration challenge, according to two new reports from independent analyst firm Verdantix. Research onSmart Innovatorsin the energy software market and aBuyer’s Guideanalysis of market dynamics finds that technology-enabled enterprise energy management requires up to 8 different software applications to meet 12 different usage scenarios.

“Optimizing enterprise-wide energy consumption and generation is a big prize that firms like Dow Chemical and cities such as New York are waking up to” said the study author, Peter Charville-Mort Verdantix Industry Analyst. “But the vast diversity of energy consuming assets – lights, security systems, HVAC, boilers, elevators, servers, routers, manufacturing equipment – means no single application will collect the data from all energy consuming end points. So the boom in energy management software – with 38 new applications launched since January 2009 – risks hitting the buffers unless buyers plan for a big integration project.”

The Verdantix surveys of energy software suppliers and buyers identified 72 suppliers globally of energy management software. Releases of entirely new applications peaked in 2009 with 21 product launches, in 2010 this fell to 10 new apps and 2011 has seen an additional 7 new energy software applications. The buying community is firmly rooted in the line of business functions. Of 33 suppliers surveyed, 63% sell to the head of energy, 53% to the head of facilities and 44% to the head of sustainability. By contrast the CFO only features as a direct contract sponsor for 28% of suppliers and remarkably the CIO’s team has only been a software buyer for 19% of 33 energy software suppliers. The low involvement of IT reflects the preponderance of SaaS propositions, tactical deployments and a lack of corporate IT policy on energy software.

The VerdantixBuyer’s Guide for Energy Management Softwarefinds that market penetration is highest in the retail, government, education, technology, real estate and telecoms sectors. Media, basic resources, travel and leisure have the lowest rates of energy software adoption according to the 33 suppliers surveyed. Suppliers have responded to the integration challenge by throwing warm bodies at the problem: 64% of the software suppliers in the survey have developed their own wrap-around energy services while a further 12% partner for energy services such as data collection, processing, analysis and energy procurement.

“Without a doubt the energy management software market is hot” commented Janet Lin, Verdantix Senior Manager in the New York office. “During the last 2 years total announced VC investment in the sector has exceeded $100 million and we estimate an equivalent amount in corporate funding or acquisition spend by the likes CA Technologies, IBM, IHS, Oracle and SAP. But funding doesn’t immediately translate into value delivery and corporate energy management is a complex challenge. IT services firms like Accenture, Capgemini and Infosys have the skill set to help their software partners crack IT systems integration. But connecting up the software to creaking, analogue systems to automate data collection and control devices will be costly and very slow.”

Note To Editors

The VerdantixBuyer’s Guide To Energy Management Softwareis based on a survey of 33 software vendors and 16 software buyers.

About Verdantix

Verdantix is the fastest-growing, independent analyst firm focused on energy, environment and sustainability. Through our global primary research and deep domain expertise we provide our clients with strategic advice, revenue generating services, best practice frameworks, industry connections and competitive advantage. For more information visit:www.verdantix.com.

Press Contact
Elinor Newman-Beckett, press@verdantix.com
+44(0)203 371 6792

Wednesday, 28 September 2011

News Source : Verdantix Says Energy Management Software Apps Will Only Deliver Value When Buyers Overcome Huge Integration Challenges