Home Energy Management System Market - Size, Share, Industry Trends, and Forecasts (2025-2032)

By Component:

Based on the component, the market is segmented into hardware, software, and services.

Trends in the Component:

• The integration of AI and IoT with the hardware components, enable real-time monitoring, predictive analytics, and automated energy consumption which in turn drives the home energy management system market trend.
• The rising adoption of smart home climate control software to optimize energy management and environmental conditions is driving the software segment progress.

Hardware accounted for the largest revenue share of 58.26% in the year 2024.

• The hardware segment comprises of control devices, communication or display devices and others.
• Additionally, the primary function of hardware component in the system is to monitor, control, optimize consumption and shift energy consumption during peak hours.
• Further, the key factors driving the adoption of system include reduced energy cost, increased energy efficiency, enhanced comfort and others in turn drives the home energy management system market size.
• For instance, in February 2025, Kenmore launched advanced home energy management system comprising of smart plugs, leak sensors, and a smart home manager app for seamless integration to offer energy-efficient living.
• Thus, as per the market analysis, aforementioned key factor is driving the hardware segment.

Software is anticipated to register the fastest CAGR during the forecast period.

• The software allows homeowners to track and manage energy consumption, which in turn helps in achieving the goal of reducing costs and environmental impact.
• Additionally, the primary function of software is to collect data, analyze data, control and automation among others is driving the home energy management system market share.
• Further, the rising demand for digital transformation of buildings is driving the adoption of software which in turn boosts the home energy management system market size.
• Therefore, according to the home energy management system market analysis, the rising demand for digital transformation of buildings are anticipated to boost the market during the forecast period.

By System:

Based on the system, the market is segmented into lighting controls, thermostats, self-monitoring systems, advanced central controllers, and intelligent HVAC controllers.

Trends in the System:

• The need for remote controlled lighting system is diving the adoption of advanced lighting controls which in turn is fueling the home energy management system market trend.
• The trend towards automating home is driving the adoption of advanced central controllers for controlling various smart home devices.

Intelligent HVAC Controllers accounted for the largest revenue share in the year 2024.

• The intelligent HVAC controller integrates with energy management system to monitor and controls energy generation, heating, ventilation, and air conditioning systems within a household.
• Additionally, the advantages include reduced energy consumption, lowered energy bills, improved comfort and others.
• Further, intelligent HVAC controller provides remote monitoring and control capabilities which is controlled through smartphone app or web portal in turn driving the adoption of intelligent HVAC controllers.
• Thus, according to the home energy management system market analysis, the remote monitoring and control feature is driving the adoption of intelligent HVAC controllers.

Thermostats is anticipated to register the fastest CAGR during the forecast period.

• The thermostats seamlessly integrate with energy management systems to optimize energy consumption and efficiency.
• Further, smart thermostats have the ability to learn user habits and adjusting temperature settings accordingly is driving the adoption of thermostats in turn is driving the home energy management system market share.
• For instance, in October 2024, Building36 launched smart thermostat offering easy and convenient connection for homeowners. The device is embedded with cellular hub which eliminates issues such as weak Wi-Fi signals or forgotten passwords.
• Therefore, as per the market analysis, the need to optimize energy consumption and efficiency are anticipated to boost the market during the forecast period.

By Technology:

Based on the technology, the market is segmented into wireless, wired, and hybrid.

Trends in the Technology:

• Advancements in IoT, AI, and cloud-based platforms utilized for energy management system is driving the adoption of wireless technology.
• The emergence of Wi-Fi 6 enabling faster connectivity for real-time energy tracking is driving the wireless segment progress.

Wireless accounted for the largest revenue share in the year 2024 and is anticipated to register the fastest CAGR during the forecast period.

• The wireless segment comprises of Wi-Fi, ZigBee, Z-Wave, Bluetooth, and Others. Also, Wi-Fi is widely utilized due to availability, compatibility, and ability to facilitate seamless connectivity.
• Additionally, the wireless connection enables remote monitoring and control of energy usage, providing homeowners convenience and insights about the operation of energy management systems.
• Further, the increasing number of smart homes is driving the need for seamless integration with others smart home devices in turn boosting the wireless segment progress.
• Thus, as per the market analysis, increasing number of smart homes as well as enabling remote monitoring and control is driving the adoption of wireless technology.

By Application:

Based on the application, the market is bifurcated into new construction and retrofit.

Trends in the Application:

• The trend towards achieving sustainability goals and stringent government rules is driving the retrofit segment.
• The integration of EV charging system with the energy management system is driving the market adoption in new construction.

Retrofit accounted for the largest revenue share in the year 2024.

• The retrofitting reduces the operational costs, which in turn helps to attract tenants and gain a market edge.
• Additionally, the advantages of retrofitting include reduced energy costs, increased comfort, reduced carbon footprint, enhanced home value and others.
• Further, the rising energy cost is propelling homeowners to upgrade existing homes with new technologies and monitoring energy consumption.
• Thus, as per the market analysis, the rising energy cost is driving the retrofit segment.

New Construction is anticipated to register the fastest CAGR during the forecast period.

• The new construction integrates smart energy solutions to enhance the property value which in turn drives the home energy management system industry.
• Further, the changing rules and regulations as well as government promoting energy efficient systems is driving the adoption of energy management system into new construction.
• For instance, in October 2024, Schneider Electric launched Schneider home designed to simplify energy management for homeowners which combines solar, battery, EV charging, and utility power among others into a system controlled by app.
• Therefore, as per the market analysis, the rules and regulations as well as government promoting energy efficient systems are anticipated to boost the market during the forecast period.

By Deployment:

Based on the deployment, the market is bifurcated into on-premises and cloud.

Trends in the Deployment:

• The trend towards automation is driving the adoption of cloud deployment in energy management systems.
• The growing environmental awareness is driving the adoption of on-premise deployment of energy management systems.

On-Premise accounted for the largest revenue share in the year 2024.

• The on-premise deployments of energy management system is managed within the home and does not rely on cloud-based solution. The deployment offers faster data access as compared to cloud deployment.
• Further, the increasing adoption of smart home technologies which offer flexibility and control is driving the on-premise deployment segment.
• For instance, in June 2024, Aurora Solar launched whole home energy management solution as well as integrate easily with solar-plus-storage system.
• Thus, as per the market analysis, increasing adoption of smart home technologies is driving the on-premise deployment.

Cloud is anticipated to register the fastest CAGR during the forecast period.

• The advancement in cellular connectivity as well as emergence of Wi-Fi 6 is propelling the adoption of cloud deployment due to faster remote access and control over the devices.
• Also, the primary function of cloud deployment is to collect data, analyze data, monitor and control energy consumption among others.
• Further, the increasing adoption of cloud computing to remotely monitor, analyze, and optimize energy usage is driving the cloud deployment segment.
• Therefore, the increasing adoption of cloud computing are anticipated to boost the market during the forecast period.