09,22,2026 37 views
A new study by Navigant projected that the smart thermostat market could reach approximately US$1.4 billion by 2020, up from around US$100 million at the time of the research.
While this represents substantial growth over the subsequent seven years, the report offers a conservative outlook for certain market barriers, particularly in the U.S. residential market where utility companies are involved. The figures could prove far higher if manufacturers build sufficiently compelling products for the open market, similar to bundled offerings seen in the retail and telecommunications sectors.
“Unlike products and solutions directly integrated into government-funded utility smart grid programmes, smart thermostats remain largely commercially driven, with purchasing decisions tied to individual energy-efficiency awareness and potential cost savings,” the report’s authors noted. “As a result, the smart thermostat market has struggled to find strong growth catalysts.”
Indeed, smart thermostats were still a niche product category at that time, and utility companies were only beginning to enter this space. Even so, emerging trends signalled that the market was gathering momentum for takeoff. According to GTM Research, only a handful of U.S. home energy management firms boasted more than one million customers. Many of these companies deploy smart thermostats as part of their service portfolios to engage end-users, delivering offerings that utilities had yet to provide.
It was reported that Nest Labs shipped 40,000 smart thermostats per month, with installations peaking during the previous Christmas season. In Europe, non-utility offerings such as Tado were also disrupting the market.
Much of the untapped growth potential for smart thermostats stemmed from limited participation by utility providers. Meanwhile, the integration of mobile connectivity with thermostatic controls made these devices far more appealing to consumers.
Compiled by China Intelligent Electrician Network. Reproduction permitted only with clear attribution to the source.
Although anecdotal accounts are not definitive, they reflect genuine forward momentum within the market. When consumers compare thermostat control apps on their iPhones or discuss Nest thermostats at casual gatherings, it signals a shift in the thermostat market. Buyers are no longer motivated solely by cost savings or energy conservation. Customers adopt these devices for the convenience of remotely adjusting heating and cooling via their smartphones; monthly utility bill savings are merely an added bonus for most users.
Most utility companies have historically shown limited interest in managing household appliances directly. However, they recognise the value of leveraging connected devices to access new customer segments and are increasingly partnering with third-party vendors, whose presence in the home automation space continues to expand rapidly.
GTM Research observed that standalone residential devices — especially smart thermostats — serve as a low-barrier entry point for suppliers seeking to engage utility customers. Multiple utilities, including San Diego Gas & Electric and Southern California Edison, have revised their residential demand response service portfolios. They use thermostats as a leverage point for their service programmes and roll out popular device models to drive adoption of related demand-response services.
