Revenue from net zero energy buildings to reach $1.3 trillion by 2035

BOULDER, USA: As green building practices become more commonplace in the global construction industry, the goal of designing zero energy buildings, or buildings that consume as much energy as they produce through on-site and renewable energy systems, has emerged as the next major frontier.

A number of countries and regions have already established long-term targets and regulations requiring zero energy building construction that will come into effect over the coming years, some as soon as 2016. These stringent regulations will accelerate adoption around the world, causing the industry to undergo a significant transformation in the coming years.

According to a new report from Pike Research, worldwide revenue from zero energy buildings will grow rapidly over the next two decades, reaching almost $690 billion by 2020 and nearly $1.3 trillion by 2035. That represents a compound annual growth rate of 43 percent, with much of that growth occurring in the European Union.

“Following the surge in LEED and other green building certifications worldwide over the last few years, zero energy building has emerged as the ‘holy grail’ in green building design,” says research analyst Eric Bloom. “Technically, zero energy building design is feasible for many building types in many regions, but concerns about the upfront cost continue to impede it in the market.”

The most noteworthy of the new regulatory regimes is in Europe, where the European Union’s Energy Performance of Buildings Directive (EPBD), which governs EU building energy codes, will require nearly zero energy construction in public buildings by 2019 and in all new construction by 2021.

The exact language of these new building codes is still being established, but it is clear they will drive significant investment in zero energy building technologies over the next few decades. Similar regulations have come into effect or are being discussed in the United States and Japan.

While the technologies required to make zero energy buildings possible, such as efficient lighting and HVAC systems, improved insulation, solar photovoltaic and other systems, can add significant upfront cost, advances in energy efficiency and renewable energy technologies will improve system performance and reduce costs.