“With electricity rates on the rise, driven by increasing wholesale prices and investments in renewable sources of energy, demand for lower energy consumption in buildings is bound to occur,” said IHS.

The full findings, which were reported in the “Building Automation Equipment” report, showed that the U.S. building automation systems market will reach a projected $1.65 billion by year-end, up 5 percent from $1.57 billion in 2012. Solid growth ranging from 7 to 9 percent will follow in the next four years, said the report, with industry revenue forecast to hit $2.24 billion by 2017, equivalent to a 43 percent increase from 2012.

The IHS documents noted that the spiraling cost of electricity is a major factor in the operational efficiency of a commercial building structure, and leaned on that reason to explain why building automation systems could play an important role.

“Prices for U.S. retail electric power will increase by 8 percent from 2012 to 2020, IHS CERA forecasts, with a sizable proportion of the increase in price related to the investments being made by the market in renewable energy,” said the company.

According to the company, a similar story is unfolding in Germany, where the Energiewende policy is promoting the move away from nuclear and fossil-fuel power generation and toward renewable sources of energy. Such investments are driving up the cost of energy overall and adding pressure to the already stretched operational budgets of many commercial and government organizations.

“With budgets cut and many large companies struggling to grow at more than 5 percent on an annual basis, the higher cost of electricity could prove to be a major headache for commercial and government building owners,” said Sam Grinter, market analyst for the Building Technologies group at IHS.

In particular, buildings consume huge quantities of energy through heating, ventilation and cooling, Grinter noted. “Making buildings as efficient as possible is crucial to driving down energy consumption. And one way to increase energy efficiency is to install an integrated building automation system,” he explained.

Building automation systems centrally manage the HVAC systems of a structure. According to IHS, This is why building owners will increasingly look to building automation systems to achieve savings on energy consumption, especially as the cost of electricity keeps going up.