The continued expansion of utility-scale PV power plants in key global markets is fuelling the growth in the operations & maintenance (O&M) ancillary market, according to a new joint report from GTM Research and SoliChamba Consulting. The growth is expected to lead to further acquisition activity.
The new report highlights that the global PV O&M market should surpass 88GW in 2014 and dominated, not surprisingly by China with over 10GW installed last year and at least 13GW expected to be installed in 2014.
However, the US is also a major market for O&M services, according to the report, which it expects to be the second-largest addressable utility-scale PV O&M market in 2018 with 31GW.
But the report also acknowledges that the expected growth is going to be front-loaded between now and through 2016, as the planned drop of the federal Investment Tax Credit (ITC) is expected to lead to a fall in PV power plant construction in 2017 and 2018.
“O&M is a game of portfolio scale and density, so the current trend of consolidation observed in 2013 and 2014 is expected to continue and accelerate, particularly in highly fragmented markets like Germany and Italy,” said report author Cedric Brehaut.
As covered by PV Tech, acquisitions of O&M firms and portfolios have been one of the developing trends in the downstream PV market in 2014. First Solar acquired skytron energy in June this year. A subsidiary of AEG Power Solutions, skytron had more than 600 power plants under managemnt, totalling around 5GW, mainly across Europe. The acquisition was said to have more than doubled First Solar’s global monitored O&M portfolio.
Leading PV inverter supplier, SMA Solar Technology also acquired Phoenix Solar’s European O&M business in August, while O&M specialist Solarrus Corporation acquired MaxGen Energy Services to expand its portfolio.
GTM Research and SoliChamba Consulting said they expected an increased number of acquisitions in the O&M space over the next few years.
Companies across the PV value chain have seen the opportunity to provide O&M services due to reliable long-term revenue streams and opportunities to integrate technologies and best practices to optimise PV power plant yields.