The global smart thermostat market size was worth USD 4.2 billion in 2021. It is projected to reach USD 40 billion by 2030, growing at a CAGR of 28.2% during the forecast period (2022–2030).
An electronic device called a smart thermostat, often called a communicative or connected thermostat, allows for establishing preset and automatic temperature settings based on the weather, heating and cooling requirements, and daily schedules. A smart thermostat can pick up on patterns in its environment, conserving energy used by heating and cooling systems. For example, a smart thermostat in the home studies the occupants' behavior patterns and modifies the heating and cooling system accordingly. As a result, it uses fewer heating and cooling systems while the house is vacant for an extended time.
Additionally, smart thermostats can be controlled by any internet-capable device, including a phone, tablet, smart speaker, or another electronic gadget. Some smart thermostats can diagnose any ducting or HVAC system issues. Rapid IoT and A.I. technology acceptance, increased use of smart technology in medical monitoring, and adoption of smart infrastructure in residential and commercial infrastructure all impact market growth.
|Market Size||USD 40 billion by 2030|
|Fastest Growing Market||Asia Pacific|
|Largest Market||North America|
|Report Coverage||Revenue Forecast, Competitive Landscape, Growth Factors, Environment & Regulatory Landscape and Trends|
With an emphasis on smart cities, where linked technologies and Internet of Things (IoT) solutions are used to improve critical infrastructure, public safety, city lighting, energy efficiency, traffic flow, and traffic congestion, society is continuing to become more urbanized. The objective is to improve urban living, working, and recreational environments while reducing cities' carbon footprints. To live up to its name, a smart city must employ technology to promote long-term growth. Technology must increase resource efficiency while promoting responsible decision-making by the public and government.
Market analysts predict that the US smart thermostat market share will rise from 16.1% in 2020 to 17.5% in 2028. This element covers buildings and companies owned by the city, institutions of higher learning, medical facilities, charities, and private citizens. Sensor technologies, behavioral economics, and gamification will probably be needed to address this element, change the physical infrastructure, and promote wise resource allocation. These cities might begin implementing technologies that use algorithms and sensors and gradually increase heating and cooling efficiency to become more energy-efficient. As a result, it might directly influence the market expansion.
The market for smart thermostats is predicted to grow profitably as automation technology usage increases in the residential, commercial, and industrial sectors. The implementation of smart thermostats for autonomous climate management is anticipated to increase as the trend for smart homes in the residential industry grows. Furthermore, the market's growth is expected to be boosted by adopting energy-efficient technology.
High investments are needed for modernized control systems and advanced connected thermostats. Small and medium-sized enterprises (SMEs) may find it challenging to enter the market. Additionally, individuals with limited purchasing power might have trouble paying the price. For instance, a December 2020 analysis by Brinks Home found that smart thermostats typically pay for themselves after two years of installation. They save 15% on cooling expenditures and 11% on heating costs. However, the initial cost can be four times higher than a typical thermostat.
Additionally, utilizing the touchscreen display panel and learning the software may be difficult. Not everyone who dislikes reading manuals and figuring out all the buttons and software may appreciate using this product. The user could not experience savings if the device is not correctly installed and set. Therefore, it is anticipated that the high cost of manufacturing, the difficulty of installation, and the different compatibility requirements will restrain the growth of the global smart thermostat market.
Automatic functionality is necessary for end-users as it saves time and is more convenient. Therefore, self-learning energy-saving technology is growing in popularity to reduce energy use. Smart thermostats' self-learning mode and remote control functionality make them perfect for home and business applications. Market participants may have the opportunity to increase their residential share due to the growing use of these self-learning devices in residential applications. The elderly will be able to operate HVAC equipment with the help of self-learning devices without having to cope with challenging programming.
Region-wise, the global smart thermostat market is segmented into North America, Europe, Asia-Pacific, and LAMEA.
Due to the rising demand for solutions to manage energy consumption and the extensive distribution network of leading suppliers in the region, North America is anticipated to dominate the global smart thermostat market share. One of the main factors driving market expansion is the rising average unit rate of power, encouraging household customers, businesses, and initiatives to embrace smart energy solutions.
Asia-Pacific is the fastest-growing region. A large portion of the world's population resides in Asia-Pacific. The smart thermostat market share in this region is anticipated to grow as smartphones and other electronic products become more popular in the residential, commercial, and industrial sectors. Due to technological developments, household goods like refrigerators, heating and cooling systems, and washing machines are becoming more intelligent. They can therefore connect to the internet as a result. Consequently, it is projected that all of these variables will promote market expansion.
Europe is the second-largest region, driven by supportive regional government policies. For instance, to lower Britain's energy usage and promote financial improvements for homes toward energy efficiency, the Department of Energy & Climate Change in the UK created the Energy Company Obligation (ECO) in January 2013.
The global smart thermostat market is segmented by technology, application, end-user, and region.
By technology, the global market is segmented into Wi-Fi, Bluetooth, Zigbee, and Others.
The Wi-Fi segment is the highest contributor to the market and is estimated to grow at a significant CAGR over the forecast period. A surge in internet penetration fuels the growth of the Wi-Fi segment, thereby enhancing the global smart thermostat market growth.
By application, the global market is segmented into Air Conditioning, Heating, and Ventilation.
The Heating segment is the highest contributor to the market and is estimated to grow at a CAGR of 26.7% over the forecast period. The Air Conditioning segment is the fastest growing.
By end-user, the global market is segmented into residential, Commercial, Industrial, and Others.
The Residential segment is the highest contributor to the market and is estimated to grow at a CAGR of 26.9% over the forecast period. The adoption of energy-efficient HVAC controls like smart thermostats has been fueled by the rising awareness of energy conservation, efficiency, and environmental protection. They aid in maximizing energy efficiency and preserving the coziest and healthful interior atmosphere. The residential vertical has also grown due to favorable government laws, tax credit facilities for installing HVAC systems, and end-users increasing focus on lowering electricity bills.