TOPIC 'Finance' on May 03, 2006 (CDT)
Renewable Power Plant Market Expanding in Europe
According to the Frost & Sullivan Energy group, that provides global industry analysis, market forecasts, and insights into emerging technologies, the European Renewable Power Plant Servicing Market earned revenues of US$417.9 million in 2005, with its estimates that this sum will reach US$1.2 billion in 2012. The expansion in the installed capacity of renewable power plants in Europe will need the services related to those power plants. This will create huge growth potential for the European renewable power plant servicing market.
"Country-specific policies and incentives to foster renewable energy supply complemented by activities at the European level, mainly through the European Commission, are expanding the renewable power plant industry," notes Frost & Sullivan Research Analyst Rajat Kumar. "This will create huge growth potential for the European renewable power plant servicing market."
At the same time, renewable power plant operators with limited experience in the actual running of their plants are increasingly outsourcing their servicing activities, including day-to-day operation and maintenance, to third-party specialists. However, skepticism regarding outsourcing these servicing activities persists.
"The utilities, with their vast experience in the operation of power plants, suffer from a traditional mindset and remain reluctant to outsource their servicing requirements," said Kumar. "They prefer to employ a full-time staff to carry out these services and view power generation as a core activity instead of looking at the power plant as an asset whose job is to earn a return just like any other asset."
With competition intensifying, industrial plants will be under pressure to continue with the outsourcing approach. Potential strategies could include the bundling of several services to make the final offer more attractive as well as catering to niche markets.
An overview is available that provides manufacturers, end users, and other industry participants with an analysis of the European Renewable Power Plant Servicing Market by subscription from Frost & Sullivan, as well as Opportunities in Servicing Renewable Energy Plants in Europe.