Steam & Air-Conditioning Supply in the US Industry Market Research Report Now Available from IBISWorld

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The phase-out of ozone-depleting heating and cooling systems has motivated building owners to opt for cost-effective alternatives such as district heating and cooling, a large segment in this mature industry. Once district heating and cooling systems are established, they tend to grow substantially as new clients are added to the network. This may help ensure industry growth well into the future. For these reasons, industry research firm IBISWorld has updated its report on the Steam & Air-Conditioning Supply industry.

IBISWorld Market Research

IBISWorld Market Research

District energy heats and cools apartment blocks, houses, schools, universities, shops and office buildings

The Steam and Air-Conditioning Supply industry has grown over the past five years, despite the recession. Industry revenue is expected to rise at an average of 1.8% annually to $1.9 billion over the five years to 2012, according to IBISWorld industry analyst Deonta Smith. Prior to the recession, construction firms built out commercial buildings, apartment complexes and other large buildings at accelerating paces amid ample credit availability. Building owners increasingly sourced district energy (centralized heating and cooling services off-site) to heat and cool their buildings. Using district energy often saved customers money (in comparison to using natural gas for heating and cooling) while energy prices were skyrocketing during the three years to 2009. However, the recession reversed these trends and industry revenue growth slowed considerably. The recent surge in energy prices during the economic recovery have served to invigorate the industry once again; as a result, industry revenue is anticipated to grow 2.0% from 2011 to 2012.

Amid high demand for district heating in years before the recession, many large firms in the Steam and Air-Conditioning Supply industry expanded their footprints by purchasing smaller firms, streamlining operations and upgrading technology. In light of amplified acquisitions activities, the number of firms operating in the industry is expected to fall at an average annual rate of 8.6% to 70 in the five years to 2012, Smith says. Thus, market share has increased over the past five years in this historically highly concentrated industry.

The next five years are set to be brighter for the industry. Players will increasingly use cogeneration in their operations to boost output. Cogeneration is a method to capture the waste heat created during the energy generation process and use it to create more energy. The switch to cogeneration will be smooth, as the acquisitions that took place over the previous five years will create economies of scale and enable large firms to easily integrate cogeneration into acquired companies. Additionally, many firms will also benefit from the construction of multi-family residences that were built during the recovery and will continue to be built during the next five years. Industry firms will generate higher revenue by providing district energy to these buildings. As a result of these trends, industry revenue is expected to grow in the five years to 2017. For more information, visit IBISWorld’s Steam & Air-Conditioning Supply in the US industry report page.

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IBISWorld industry Report Key Topics

Firms in this industry supply district energy for heating and cooling. Typically, they generate hot and cold water or steam via closed mains systems to cool or heat commercial or residential buildings. The district energy activities of firms that have electricity generation operations are included as well.

Industry Performance
Executive Summary
Key External Drivers
Current Performance
Industry Outlook
Industry Life Cycle
Products & Markets
Supply Chain
Products & Services
Major Markets
Globalization & Trade
Business Locations
Competitive Landscape
Market Share Concentration
Key Success Factors
Cost Structure Benchmarks
Barriers to Entry
Major Companies
Operating Conditions
Capital Intensity
Key Statistics
Industry Data
Annual Change
Key Ratios

About IBISWorld Inc.
Recognized as the nation’s most trusted independent source of industry and market research, IBISWorld offers a comprehensive database of unique information and analysis on every US industry. With an extensive online portfolio, valued for its depth and scope, the company equips clients with the insight necessary to make better business decisions. Headquartered in Los Angeles, IBISWorld serves a range of business, professional service and government organizations through more than 10 locations worldwide. For more information, visit http://www.ibisworld.com or call 1-800-330-3772.

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Gavin Smith
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