Environmental Consulting Services Market Size, Trends [2031]

Report Description

Environmental Consulting Services Market Outlook 2031

The global environmental consulting services market size was USD 36 Billion in 2022 and is likely to reach USD 71.9 Billion by 2031, expanding at a CAGR of 8% during 2023–2031. The market is driven by the strict environmental regulations implemented by various government organizations, coupled with the growing focus on sustainable practices.

Rising climate change concerns across the global economies are leading to the implementation of environmental protocols by various governments. Companies in private and public sectors are heavily focusing on sustainable practices. Furthermore, growing awareness among consumers about the impact made by various products on the environment is resulting in conscious buying decisions.

This, in turn, is boosting reliance on environmental consulting services to cover all the possible practices within an organization under eco-friendly practices. The growing usage of technologically advanced tools in environmental consulting services for improving environmental decisions is expected to create opportunities in the market during the assessment period. For instance,

• Honeywell’s Environmental Sustainability Index Q4 2023 compiled insights gained from over 750 business executives directly related to environmental sustainability (ES) initiatives. 75% ranked sustainability as the foremost important initiative. 92% of organizations have formal plans toward ES goals.

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The research report finds that the COVID-19 pandemic affected the environmental consulting services market. The demand for various ES services declined, as numerous organizations faced operation limitations, owing to emergency lockdowns implemented in various countries. Nearly every industry registered a significant revenue decline, which resulted in budgetary cutdowns for non-time-sensitive services and solutions.

However, the awareness about global warming, pollution, and other climate-affecting factors grew substantially among the global population during and post the pandemic normalization. This raised the need for strict implementation of eco-friendly practices, resulting in growing demand for environmental consulting services.

Impact of Artificial Intelligence (AI) on the Environmental Consulting Services Market

The emergence of various generative artificial intelligence tools is anticipated to benefit the market in the coming years. AI tools are used in consulting services to analyze large amounts of data from various sources to recognize patterns and deep insights. This, in turn, aids in implementing accurate environmental policies and covering all the possible aspects.

AI improves consulting services by enabling them to get more results within less time and costs. AI-powered environmental consulting software is expected to reduce complexities in projects, thereby, enabling consulting firms to provide high-scale strategic work. For instance,

• In June 2023, PROTOSTAR, a management consulting services provider, launched AI-based consulting services to enable sustainable & equitable energy transition. The firm aims to revolutionize the way consulting services are executed by harnessing the power of generative AI and advanced analytics.

Environmental Consulting Services Market Dynamics

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Major Drivers

Growing enactment of environmental regulations with rising pressure from customers, investors, and regulators is expected to fuel the market in the coming years. Submitting environmental impact assessments and auditing to authorities has become crucial to gaining approval for projects, such as commercial projects, industrial projects, and township infrastructure development.

Companies are increasing their dependence on consulting services for effective implementation of environmental regulations. This supports companies in gaining a comprehensive insight into the environment, which is used to mitigate several hazard factors. For instance,

• A survey published in November 2022 revealed that 87% of business executives expect a rise in investment in sustainability in the next two years, from their organizations. Approximately, 86% of business executives stated that investments in sustainability, are protecting their businesses from disruption.

Rising adoption of renewable energy measures and focus on cost saving is expected to propel the market. Adoption of sustainability consulting services is essential for businesses with long-term vision. This helps in complying effectively with necessary environmental protocols and saves expenses that occur due to needless resource use.

Adopting environmental consulting is proving to be efficient for firms in optimizing the use of raw materials, energy consumption, and other resources. This results in saving significant costs for companies in the long term.

Existing Restraints

High costs of environmental consulting services are expected to hinder the market. Several organizations tend to limit their investment toward integrating environmentally focused policies, owing to budgetary concerns. High initial capital requirements and expenses involved in switching to sustainable solutions are expected to affect the market. In addition, the unwillingness to change traditional operations to sustainable affect the market in the coming years.

Emerging Opportunities

Adoption of innovative technologies and diversification of the services to cover wide aspects are expected to create lucrative growth prospects for the players in the market. Solutions powered by artificial intelligence, machine learning, and the Internet of Things (IoT) are transforming environmental services.

For instance, the use of drone services for environmental monitoring ensures strict compliance with regulations set by government authorities. Additionally, the expansion of consultancy services to cover wide industries and areas of operations impacts environmental policies, which is projected to generate opportunities in the market.

Scope of the Environmental Consulting Services Market Report

The global market research report includes an assessment of the market trends, market segments, and regional markets. Overview and dynamics have also been included in the report.

Market Segment Insights

Service Type Analysis

Based on service type, the environmental consulting services market is divided into permitting & compliance, investment assessment & auditing, monitoring & testing, and project & information management. The monitoring & testing segment is expected to dominate the market in terms of demand, owing to the need for consistent tracking of sustainability practices across the operations.

Corporations and the public sector implement effective measures with consultancy aid that ensure the best standard practices. The environmental monitoring and testing services are intended to aid key decision-takers, policymakers, and stakeholders, in framing future policies or steps that are necessary for eco-friendly practices.

The investment assessment & auditing segment is anticipated to register significant growth in the coming years. The segment growth is due to the rising budget allocation toward sustainability and corporate social responsibilities.

Consultancy services are the go-to option for analysis of return on investment (ROI) and auditing the outcomes achieved from certain sustainability practices, as they possess more expertise on the subject. Large corporations across the globe are heavily relying on environmental consultancy providers, to assess investment-related decisions toward environmental, social, and governance (ESG).

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Application Analysis

On the basis of application, the global market is segregated into waste management, water management, and others. The water management segment is projected to expand at a substantial CAGR during the forecast period, owing to the need for effective water management.

The ongoing water scarcity issue in different parts of the world, due to inconsistent rainfall and weather changes, has created the need for cautious utilization of water resources. Additionally, the regulations set by different governments for industries and commercial spaces about water usage and recycling before being released into the environment are driving the demand for consultancy services, thereby boosting the segment. For instance,

• According to a study published by the World Bank on Water Resources Management in October 2022, water scarcity affects 40% population of the world. It estimates that the world is projected to face a 40% shortfall between demand and available water supply by 2030.

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Vertical Analysis

On the basis of vertical, the environmental consulting services market is segmented into energy & utilities, manufacturing & process industry, chemical & petroleum, public sector, transportation & construction industries, mining, and others. The energy & utilities segment is expected to register a robust growth rate during the forecast period, as it is required to comply with health safety and different environmental protocols in its majority of operations.

Companies are increasing investments in production of electricity, due to the rising energy demand across the globe. This, in turn, is expected to drive the demand for environmental consultancy, as various governments worldwide are enacting strict regulations on industrial projects and resource use. For instance,

• According to an Electricity Market Report 2023 published by the International Energy Agency (IEA) in February 2023, the electricity demand stayed resilient worldwide in 2022. The energy crisis caused by the Russia-Ukraine war fueled the electricity needs. The electricity requirements grew by nearly 2% in 2022, in comparison to the 2.4% average growth between 2015 to 2019.

• As per the Electricity Market Report 2023, it is estimated that electricity demand across the globe is likely to grow at a much more rapid pace of 3% every year during 2023-2025, in comparison to the 2022 growth rate.

Regional Outlook

In terms of region, the global environmental consulting services market is classified as Asia Pacific, North America, Latin America, Europe, and Middle East & Africa. North America is anticipated to dominate the market during the projection period, owing to rising digitization and wide-scale transformation of environmental compliance with digital monitoring tools and software solutions.

Growing investment from small & medium enterprises, as well as large corporations toward sustainable practices is creating opportunities in the market. The increasing implementation of environmental health and safety software is further increasing the demand for consultancy services in this region, as new complexities and issues are being identified with such digital tools. For instance,

• According to a study report published in September 2021, the environmental consulting services industry revenue is likely to reach USD 12.4 billion by 2024.

The market in Europe is expected to register rapid growth, with strict ESG regulations adopted by governments in European countries, including Germany, the Netherlands, and Denmark. The increasing pressure from environmentally conscious customers, investors, and regulatory organizations is boosting demand for ESG consulting services across European corporations. Rising acceptance of advanced digital environmental monitoring and auditing tools by corporations in the region is anticipated to generate opportunities in the market.

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