Building energy management systems (BEMS) for utility customers’ global spending will reach $41 million in 2012, growing at a compound annual growth rate (CAGR) of 29.2 percent through 2020, when the market will reach $319 million worldwide, according to a Pike Research report.

The US will remain the largest market over the forecast period, and is expected to be more than double the size of Western Europe, the next largest market, the report says.

Pike Research defines BEMS as IT-based monitoring and control systems that can provide information on the performance of some or all of the components of a building’s infrastructure, including its envelope, heating and ventilation, lighting, plug load, water use, occupancy and other resources.

Although BEMS vendors have traditionally focused on large enterprises as their clients, more utilities are considering BEMS, Pike Research says. Vendors’ energy management services can provide utilities with a new tool to boost effectiveness of their energy efficiency and demand-side management programs.

Because of this, BEMS vendors should market their systems to utilities, which offer a new, large customer base.

Pike Research says only a handful of vendors and utilities currently work together, but more pilot programs are in the works and will be announced in 2013.

New mandates and regulations for utilities are driving the market, and utilities are realizing it’s less costly to employ an energy management system than it is to build a new generation plant.

BEMS vendors do face challenges in accessing the utility market, however. Pike Research says these hurdles include longer sales cycles and understanding each utility’s business strategies and different regulatory environments.

A Pike Research report published in September said the automated, or smart, building energy management systems market will almost quadruple in size and be worth more than $1 billion by 2020.