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New Report: Frequency Inverter Market to Suffer in Europe
A new Frost & Sullivan market report, titled, "Strategic Analysis of the Frequency Inverters Market in Solar and Wind Energy Industry," details a murky future for inverters in Europe but strong growth in the Americas.
February 07, 2013 | By
POSTED IN: Energy Management
The U.S. wind power industry has ben in total flux for the last 14 months, with the 2012 presidential campaign rhetoric and the minor earthquake called the fiscal cliff. Now, a new report from London-based Frost & Sullivan (www.motors.frost.com) forecasts low demand in the Europen market for solar and wind frequency inverters, due to policy changes in the renewable markets and the ongoing debt crisis. Specific policy changes that could dampen investment in the renewable energy sector in the next two years are predicted tax hikes, reduced subsidies and the increase in feed-in tariffs—long term contracts offered to energy producers.
The new report finds that frequency inverters in the global solar and wind energy markets earned $6.00 billion and $2.84 billion, respectively, in 2011. Frequency inverters are estimated to rack up $ 14.58 billion in the solar industry and $7.09 billion in the wind industry by 2018.
The impact of such changes on the frequency inverters market will be high during the short-term and moderate during the medium- and long-terms.
The report goes on to say "despite these challenges, benefits of energy optimization, lower maintenance costs and higher ROI will ensure continued product uptake to buoy frequency inverter market revenues during this turbulent phase." Unlike Europe, the market is expected to see strong growth in other regions such as Asia and North America.
I find this report to be a quite accurate read of the inverter market and the overall wind market in Europe, and the North American market. The wind power industry in the U.S, on a certain level, has made a breakthrough and is part of the energy discussion. No small feat considering the landscape ten years ago. Now, the wind power industry is looking at "off-shore" test pilots, with the help of the U.S. government. Late in 2012, the DoE announced "funding up to $168 million over six years, will expedite the development of the nations' first offshore wind farms. None are operational yet, but nine have reached the advanced development phase and 24 more are in earlier stages."
In Europe, the Hannover Show in April 2013 will showcase a Wind show/pavilion and marks the first time a hall has been dedicated to the offshore technologies and services in this highly specialized renewables segment. Also, "a new proposal by a Belgian cabinet member, Johan Vande Lanotte, would create a nearby man-made atoll placed in the North Sea to store energy," reported by Martin LaMonica via the MIT Technology Review. Excess wind energy—the biggest challenge with solar and wind—would be sent to the atoll, 3km offshore, and would power turbines to pump water (pumped hydro) into the atoll. During peak energy times, the water is released to turn a generator and create electricity. The article states, "the Belgian government doesn’t propose building the facility itself and would rely on private industry instead."
Short and Long-term Outlook
“The impact of such changes on the frequency inverters market will be high during the short-term and moderate during the medium- and long-terms,” cautions Frost & Sullivan's industry analyst, Sivakumar Narayanaswamy. “Market participants are planning to adapt to this new policy landscape by streamlining operational costs and developing sustainable strategies.
“Solar inverters are highly durable and have lower lifecycle costs, which help reduce maintenance costs by 10 per cent compared to other inverter products,” notes Narayanaswamy. “Lower maintenance costs will make these inverters more cost-effective for customers.” Similarly, wind inverter products have an average lifespan of 8-10 years. Efforts to further enhance product quality and durability will reduce maintenance costs, supporting cost savings for customers. Rapid ROI will be another factor motivating the continued demand for both solar and wind frequency inverters. These products enable energy optimisation, boosting energy savings for customers.
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