Smart Thermostat Market Size
| Study Period | 2019 - 2029 |
| Market Size (2024) | USD 5.34 Billion |
| Market Size (2029) | USD 13.36 Billion |
| CAGR (2024 - 2029) | 20.10 % |
| Fastest Growing Market | Asia Pacific |
| Largest Market | North America |
| Market Concentration | High |
Major Players
*Disclaimer: Major Players sorted in no particular order |
Smart Thermostat Market Analysis
The Smart Thermostat Market size is estimated at USD 5.34 billion in 2024, and is expected to reach USD 13.36 billion by 2029, growing at a CAGR of 20.10% during the forecast period (2024-2029).
Lighting and other household appliances consume a considerable amount of energy, and presently, there is a dire need to use these energy resources efficiently. Therefore, governments are emphasizing the use of smart devices in homes.
- The increasing adoption of smart homes across the globe, the occurrence of the COVID-19 pandemic, the emergence of IoT-enabled HVAC systems, the surging adoption of smart home voice assistants, and government regulations pertaining to increasing the energy efficiency of buildings are some of the factors propelling the demand for Smart Thermostat Market over the next couple of years.
- Moreover, the critical factors driving the need for smart thermostats are convenience, energy conservation, energy tracking, and the need for an increase in potential savings. Also, the BYOT (Bring-your-own-Technology) trend is expected to stimulate the growth of the market over the forecast period. Consumers have independently begun purchasing smart Wi-Fi-enabled thermostats capable of receiving demand response control signals.
- Additionally, with a Wi-Fi connection and smart thermostats, virtual assistants, like Amazon Alexa, or Google Assistant, are increasingly being used to control and monitor the home temperature, program schedules, or manage the Air conditioning.
- A wireless network is the most widely used connectivity technology in smart thermostats as it helps the customers to bring down the maintenance and installation costs, along with providing higher scalability and flexibility, and enhanced connectivity.
- The installation of wireless connectivity makes smart thermostats more compatible with smart devices such as tablets, smartphones, and laptops for operation. Further, the increasing adoption of smart homes in the United States is expected to fuel the demand for smart thermostats based on wireless connectivity technology.
Smart Thermostat Market Trends
This section covers the major market trends shaping the Smart Thermostat Market according to our research experts:
Increasing Demand for Energy-saving Devices
- As smart thermostats aid in saving electricity, owing to such characteristics, the demand for smart thermostats is expected to grow over time and has been influenced by the augmented demand for energy-efficient solutions.
- According to a study conducted by Nest Labs (a part of Google LLC), the company compared the energy bills of real people in 41 states before and after the installation of Nest Learning Thermostats. The study was conducted via two independent studies - from real Learning thermostats and real homes with real families.
- As per the result, on average, the Nest Learning Thermostat saved approximately 10% to 12% on heating and approximately 15% on cooling. Further, based on typical energy costs, the company estimated an average savings of approximately USD 131 to approximately USD 145 per year. That means the Nest Learning Thermostat paid for itself in under two years. Such positive results are expected to promote the adoption of smart thermostats in the market globally during the study period.
- According to the US EIA, the global energy demand will grow at 2.1 % per year to 2040 with the current stated policies scenario. The demand surge will raise the electricity share in 2040 to 24%.
- The use of technologies, changes in government policies, developing economies, and market conditions are driving the growth of low-carbon sources to maintain the environmental levels. Electricity consumption has a direct effect on the carbon footprint as electricity generation requires the burning of non-renewable resources and leads to a carbon footprint.
North America to Hold Significant Market Share
- North America has been the major contributor to the revenue generated by smart thermostat products and services globally, owing to the increasing adoption of the technology across the residential sector of the region.
- Owing to this rise in smart homes and smart home devices, connected thermostats are also expected to witness an increased adoption, particularly in North America, being the early adopter of new technological encroachments. The increasing dependency on smartphones and mobile apps is only set to drive the demand for smart home applications as smartphones offer an intuitive medium via different applications for controlling smart home technologies.
- Smart homes are accelerating, with nearly 30 million US households predicted to add smart home technology soon. The products consumers are looking to integrate into their homes include connected cameras (40%), video doorbells (26%), and connected light bulbs, thereby fueling the demand for the smart thermostat application among the smart solutions.
- The addition of advanced technologies, like AI and predictive analytics, gives a notion of the increased price of allied thermostats. Therefore, the market has been further boosted by active government/state-level association initiatives to make the products affordable to the end consumers across residential applications.
Smart Thermostat Industry Overview
The smart thermostat market is fragmented and competitive. Due to the government's support and promotion for the uptake of smart devices in residential buildings, many smart home vendors have entered the market. Some of the key players in the market include Alphabet Inc. (Nest Labs - Google), Honeywell International Inc., Ecobee, Schneider Electric SE, and Lennox International Inc., among others. Some recent developments in the market include:
In September 2022, Autogrid entered into a partnership with Mysa with an aim to launch utility-scale virtual power plants using smart thermostat technology for grid modernization. AutoGrid would be leveraging its VPP platform in collaboration with Mysa's smart thermostat technology for electric heating and cooling to provide a scalable and comprehensive dispatch solution for both technologies and other IoT solutions from various thermostat and Water Heater Controls platforms.
In May 2022, Ecobee launched its new Ecobee Smart Thermostat Premium, which would be replacing its existing flagship model, SmartThermostat with Voice Control, with new features.
Smart Thermostat Market Leaders
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Nest Labs Inc.
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ecobee
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Emerson Electric Co.
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Johnson Controls
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Honeywell International
*Disclaimer: Major Players sorted in no particular order
Smart Thermostat Market News
- September 2022: Aqara, a leading provider of smart home products, announced the launch of its Radiator Thermostat E1 to automate hydronic radiators, making the heating systems smarter for improved energy efficiency and comfort. Based on the Zigbee 3.0 protocol, the Thermostat is anticipated to support the future-proofing Matter standard via an OTA update of the compatible, Zigbee 3.0-based Aqara hub.
- April 2022: Voltus, Inc., a distributed energy resource (DER) software technology platform, collaborated with Resideo, a global provider of home comfort and security solutions and a distributed energy resource management system (DERMS), and Google Nest, launched its first bring-your-own-thermostat program that would deliver both demand response capacity and ancillary services.
Smart Thermostat Market Report - Table of Contents
1. INTRODUCTION
1.1 Study Assumptions and Market Definition
1.2 Scope of the Study
2. RESEARCH METHODOLOGY
3. EXECUTIVE SUMMARY
4. MARKET INSIGHTS
4.1 Market Overview
4.2 Industry Value Chain Analysis
4.3 Industry Attractiveness - Porter's Five Forces Analysis
4.3.1 Bargaining Power of Suppliers
4.3.2 Bargaining Power of Buyers
4.3.3 Threat of New Entrants
4.3.4 Threat of Substitute Products
4.3.5 Intensity of Competitive Rivalry
4.4 MARKET DYNAMICS
4.4.1 Market Drivers
4.4.1.1 Increasing Demand for Energy-Saving Devices
4.4.1.2 Effectiveness & Convenience in Controlling HVAC Devices at Home
4.4.2 Market Restraints
4.4.2.1 High Product Price and Installation Costs of Smart Thermostats
4.4.3 Market Opportunities
4.4.3.1 Proliferation and Integration of Smart Home Devices
4.4.3.2 Internet Penetration and Demand for Smart Phones
5. MARKET SEGMENTATION
5.1 By Type
5.1.1 Wireless
5.1.2 Wireless
5.2 By End-User Vertical
5.2.1 Residential
5.2.2 Commercial
5.3 Geography
5.3.1 North America
5.3.2 Europe
5.3.3 Asia-Pacific
5.3.4 Rest of the World
6. COMPETITIVE LANDSCAPE
6.1 Company Profiles
6.1.1 Nest Labs Inc.
6.1.2 Resideo Technologies, Inc.
6.1.3 ecobee
6.1.4 Emerson Electric Co.
6.1.5 Lennox International Inc.
6.1.6 Alarm.com Inc.
6.1.7 LUX Products Corporation
6.1.8 APX Group Inc.
6.1.9 Johnson Controls PLC
6.1.10 Netatmo SA
6.1.11 Tantalus Systems Corporation
6.1.12 tado GmbH
6.1.13 Centrica Hive Limited
6.1.14 Siemens AG
- *List Not Exhaustive
7. INVESTMENT ANALYSIS
8. MARKET OPPORTUNITIES AND FUTURE TRENDS
Smart Thermostat Industry Segmentation
Smart thermostats refer to devices that allow remote connectivity and can be managed through a handheld device, finding its applications in residential and commercial sectors. These thermostats can be wired and wireless with the same features but a different installation process. These are the devices that are connected and allow remote connectivity in the consumer sector. Thermostats are termed smart due to the inherent capabilities of being able to communicate with IoT devices within a smart building, the ability to learn with AI capabilities, active geo-fencing features, reduced energy consumption, and the ability to communicate with emerging virtual private assistants.
The study on Smart Thermostat Market covers segmentation by Type of Thermostat, including Wired and Wireless, End-User, including Residential and Commercial Sectors, as well as Geography. The market sizes and forecasts are provided in terms of value (USD million) for all the above segments.
| By Type | |
| Wireless | |
| Wireless |
| By End-User Vertical | |
| Residential | |
| Commercial |
| Geography | |
| North America | |
| Europe | |
| Asia-Pacific | |
| Rest of the World |
Smart Thermostat Market Research FAQs
How big is the Smart Thermostat Market?
The Smart Thermostat Market size is expected to reach USD 5.34 billion in 2024 and grow at a CAGR of 20.10% to reach USD 13.36 billion by 2029.
What is the current Smart Thermostat Market size?
In 2024, the Smart Thermostat Market size is expected to reach USD 5.34 billion.
Who are the key players in Smart Thermostat Market?
Nest Labs Inc., ecobee, Emerson Electric Co., Johnson Controls and Honeywell International are the major companies operating in the Smart Thermostat Market.
Which is the fastest growing region in Smart Thermostat Market?
Asia Pacific is estimated to grow at the highest CAGR over the forecast period (2024-2029).
Which region has the biggest share in Smart Thermostat Market?
In 2024, the North America accounts for the largest market share in Smart Thermostat Market.
What years does this Smart Thermostat Market cover, and what was the market size in 2023?
In 2023, the Smart Thermostat Market size was estimated at USD 4.45 billion. The report covers the Smart Thermostat Market historical market size for years: 2019, 2020, 2021, 2022 and 2023. The report also forecasts the Smart Thermostat Market size for years: 2024, 2025, 2026, 2027, 2028 and 2029.
What are the trends shaping the Smart Thermostat Market?
Key trends shaping the Smart Thermostat Market are: a) Increasing integration with AI and machine learning b) Rise of voice-controlled thermostats c) Growing emphasis on sustainability and energy conservation
Smart Thermostat Industry Report
The smart thermostat industry is experiencing remarkable growth, fueled by the rising demand for energy-efficient solutions and the adoption of smart homes. Innovations in IoT-enabled HVAC systems and wireless connectivity technologies like Wi-Fi and ZigBee have made smart thermostats a key component in home automation, offering features such as remote appliance control. The market, featuring connected, standalone, and learning thermostats, caters to a wide array of preferences, spanning residential to commercial sectors. This growth is further supported by the shift towards open API for enhanced interoperability with utility and home energy management systems. Despite the hurdles of high costs, the industry's future looks bright, with significant expansion opportunities in both developed and emerging markets, driven by consumer demand for convenience, energy savings, and the evolution of homes into interconnected environments. For detailed insights, Mordor Intelligenceā¢ provides comprehensive analysis and forecasts on the smart thermostat market share, size, and revenue growth, including a free report PDF download for a deeper understanding of this booming industry.
