The need to conserve electricity and reduce greenhouse gas (GHG) emissions and supportive government policies are driving the construction of net-zero energy buildings (NZEBs). As a result, the net zero energy buildings market is predicted to value $2,106.6 million in 2024, growing from $896.6 million in 2018 at a healthy 15.6% CAGR during 2019–2024 (forecast period). The basic ideas behind NZEBs are that the electricity consumption is minimized and only electricity produced by the building itself is used, so that the net energy consumption comes out to zero.



On the basis of equipment, the net zero energy buildings market is classified into lighting systems, heating, ventilation, and air conditioning (HVAC) systems, insulation panels, and solar photovoltaic (PV) Panels. Out of these, the highest revenue to the industry was contributed by the solar PV panels classification in 2018. Commercial NZEBs house a large number of appliances, to power which a substantial number of PV panels are required. Due to the construction of more NZEBs and solar power’s proven environmental benefits, the demand for PV panels will rise too.


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Of the residential and commercial bifurcations within the application segment, the industry was dominated by the commercial bifurcation in 2018. Compared to residential buildings, the floor count and floor area of commercial buildings are more, which makes the former more lucrative for infrastructure developers, in terms of the rent received; this is why more commercial NZEBs than residential NZEBs are being built. During the forecast period, the residential bifurcation will display the faster advance, driven by governments’ energy efficiency initiatives and the public’s rising awareness about environmental degradation.



The key driver for the net zero energy buildings market is the government regulations aimed at reducing the usage of electricity. For instance, as per the California Long-Term Energy Efficiency Strategy Plan of the California Public Utilities Commission (CPUC), only the construction of residential and commercial NZEBs is allowed from 2020 and 2030 onward, respectively. With the increasing construction of such infrastructure, the demand for the various components and materials that go into them will surge too, as they are designed to minimize heat loss and gain, reduce electricity usage, and produce renewable energy.



Another major reason behind the swift advance of the net zero energy buildings market is the growing need to minimize carbon emissions. Currently, most of the power is produced from fossil fuels, such as crude oil, natural gas, and coal. As these fuels are burned in power plants to create electricity, they release massive amounts of GHGs into the atmosphere. Thus, the focus is increasing on not only decreasing the usage of electricity, but also generating it from cleaner resources, such as the wind and sun.



Currently, the most-lucrative net zero energy buildings market is North America, owing to the stringent electricity conservation and GHG emission reduction targets here. This is why governments at various levels in the two regional countries have initiated a large number of projects to boost the construction of NZEBs. For similar reasons, Europe is the second-largest market for the components that go into an NZEB. Most of the regional countries are part of the Paris Climate Agreement, which seeks to substantially reduce the carbon emissions and create a greener planet.



Hence, as more initiatives and regulations regarding the conservation of electricity and bringing about a decrease in GHG emissions are announced around the world, the number of NZEBs will increase.