- Renewable Generation
- Distributed Generation
- Utility Infrastructure
Unlocking Aftermarket Opportunities in the Energy Sector
Equipment manufacturers, project developers, and energy providers can unlock recurring revenue opportunities and competitive advantage by redefining their aftermarket strategies. In December 2018, Vertiv announced that it completed the purchase of the maintenance business of MEMS Power Generation (MEMS), a privately owned company headquartered in the UK that specializes in temporary power solutions. The 160 MEMS contract customers in the UK range from data centers to hospitals and universities to industrial companies and utilities. Vertiv will service the newly acquired MEMS customers with the Vertiv UK service team. The acquisition not only strengthened Vertiv’s capability in generator maintenance but also expands its service offerings in critical infrastructure in Europe and the Middle East & Africa. This marks the third acquisition for Vertiv and is consistent with the company’s growth strategy.
Is This a Sign?
This recent acquisition by Vertiv confirms a growing interest across distributed energy resources (DER) businesses to focus and grow their asset management and services businesses.
On January 16, renewable energy developer BayWa r.e. secured the contract for handling the operations and maintenance (O&M) of 13 solar farms with a combined output of more than 60 MW across the UK on behalf of Octopus Investments. The contract covers all electrical and non-electrical tasks for plant management, as well as performance optimization of the projects. Asset performance management in the renewable sector is exponentially growing following the attractive growth potential of the global solar and wind energy markets. In a market driven by economies of scale, large scale contracts such as the one secured by BayWa r.e., can effectively maximize profitability at minimized risk.
O&M coupled with asset management can potentially unlock exciting recurring revenue opportunities and access to new value streams for DER manufacturers and service providers while maximizing the profitability of the asset. Innovative asset management strategies and business models can help optimize cost of operation across the lifetime of assets. Traditionally, plant operators and asset owners were more concerned about reducing operational costs. However, the new generation of customers are more innovative in their approach and are proactively driving new business models along with their service providers. The hybridization of the energy ecosystem requires assets to be more efficient and cost-effective. OEMs across both conventional a renewable energy technologies are increasingly invested in the abundant cost reduction potential that asset management can offer.
Digitization is a key enabler in the asset management industry. Unlocking the power that data analytics can bring to a business’s asset management function will transform the distributed energy sector’s ability to drive up efficiency, lower emissions across hybrid energy systems, and bring more flexibility and resilience to power generation across technologies.