The global energy and resources consulting market is valued at $11.1 billion, according to a recently released report, 5.7% higher than the previous year. Europe represents one third of the industry.
In 2012 companies and governments worldwide spent approximately $10.5 billion on energy and resources consulting, according to data from analyst firm Source Information Services (Source). After several years of slow growth, spending accelerated in 2013, growing the market by 5.7% to $11.1 billion. This more positive picture can be partially attributed to the strong growth in the US which, which makes up 39% of the total market.
From a functional perspective, technology is with a distance the biggest service in the global energy and resources consulting market – accounting for 33% of all consulting spend. This is followed by operational improvement ($2.64 billion) and financial management ($1.94 billion).
Looking forward, the outlook is mixed, forecasts Source. Large changes in the energy landscape (e.g. regulation, M&A, sustainability) are expected to boost transformation support and hence demand, with technology-driven changes regarded as the key growth driver. “Technology is set to continue growing, not just because it enables clients to improve productivity and cut costs, but also because it’s becoming a driver of change in its own right. Big data and digitisation are having a particularly revolutionary effect as clients are eager to collect and analyse vast amounts of data that simply weren’t available before,” says Alison Huntington from Source.
Another area with a positive outlook is environmental consulting, a field which is returning to the “forefront of the energy and resources industry,” says Huntington. “Following a recent string of high profile [events] …… it’s clear that environmental considerations are changing the way the industry works – and that means big opportunities for consultants.”
At the same time, Huntington highlights that there are concerns in the market that the falling price of oil will soon or later have its impact on consultant spending. “When commodity prices are high and climbing, as they were for much of the last ten years, demand for consulting is high, however when prices plummet, consulting is often one of the first things to be cut. With oil prices currently at a five year low, there is concern from many consultants in the oil sector.”
With a total size of $11.1 billion, the energy consultancy market is nearly double the size of the healthcare consulting industry, however still far off the financial services segment, valued at nearly $24 billion, which amounts to a quarter of the entire industry.