Electric Process Heaters Market: Troubleshooting Market Challenges and Identifying Growth Avenues
Although it is common in several industries to perceive digitization as a threat, it does not hold true for the energy sector. Energy industry experts believe that digitalization could prove key in addressing several pressing challenges in Germany’s energy sector. In Germany, power consumption is poised to increase due to the electrification of transport, heating, and the rise in industrial processes. Furthermore, the share of renewable energy derived is also on the rise. Even if energy efficiency grows in Germany’s energy sector, the demand for electrical power is expected to grow. Moreover, Additionally, Germany will have to electrify more industrial processes to ensure that the country’s ambitious targets to reduce the emission of greenhouse gases are met. This could considerably increase the demand for power in the region.
Consequently, this results in the power supply become highly volatile in the region and making it challenging to manage and balance the power system. Experts at Infiniti Research believe that digitization can act as a catalyst to combat such challenges and prepare the German energy sector for the future.
Handle growing complexity
The way power is produced and distributed is largely changing. Although renewable energy is an effective way to produce energy, they cause increasing volatility and complexity. Also, there is an increase in the number of players at both ends of the power line. Using digital platforms, the energy sector can handle these complexities and promote new forms of collaborations and encourage better trading relations.
Matching demand and supply
Power consumption is commonly a linear process. However, this pattern is set to change with smart power-consuming devices. Smart power consumption devices are constantly connected and leverage the internet in order to transmit information end-to-end. The information available can make smart devices to enhance their performance by optimizing their own consumption. This helps balances the overall power load.
Managing surplus power
The ongoing decentralization of power generation in the energy sector will result in surplus power being generated. This energy must be put to immediate use or must be stored. The growing surpluses can be handled by creating heat, producing synthesized heat, storing in batteries, using smart consumption to match peaks in supply, or through smart distribution that can be enabled through digital platforms.
The recent breakthroughs in natural-gas extraction is a classic example of the sheer speed with which game-changing technologies are transforming the energy industry. With rising environmental concerns and clean energy becoming a necessity than ever before, we can expect to see several groundbreaking clean energy trends over the next couple of years. This article describes some of the key clean energy trends that could revolutionize the energy sector. While not all of these clean energy trends may succeed in the long-run, even if a few of them pan out they could bring considerable changes to the energy landscape. Furthermore, it is also possible that the development of energy technologies is approaching a tipping point that will generate increases in energy productivity on a scale not seen since the Industrial Revolution.
Clean energy trends 2020
Digital power conversion
Large-scale high voltage transformers that were developed in the 1880s lead to the widespread development of the electrical grid, virtually the same technology continues to be used today. High-speed digital switches that are composed of silicon carbide and gallium nitride have been developed for high-frequency power management in military jets to high-speed rail. They are known to be highly energy-efficient and take up only about 1 percent as much space and are more reliable and flexible than the existing transformers. Today’s advanced applications include consumer electronics and variable-speed industrial drives for manufacturing. As such applications expand and the major semiconductor manufacturers begin to produce these technologies at scale, they could replace conventional transformers in the utility industry by 2020. China is particularly well positioned to reap the benefits of adopting digital-power electronics because of the scale of its planned grid expansion.
Blockchain technology would enable the buy and sell of clean energy at optimal times and will largely be driven by IoT and related technologies. This can play an integral role in boosting the performance of energy saving devices. This is a type of peer to peer network that effectively allows customers to trade energy. This may be done through the energy company itself, or even from customer to customer. Either way, this means that the majority of firms will need to capitalize on this emerging market. This can all be done in real-time settings and with the transparency that the blockchain network provides may prove to be beneficial to both businesses and their customers.
Leaders of companies and countries who neglect what is happening on the margins today risk being pushed to the margins themselves in the not-too-distant future.
Such clean energy trends could help coal-fired generators to capture majority of their carbon-di-oxide at a much lesser cost. The viability of this technology could also prevent the closure of several coal plants in the coming years. The same is applicable to plants situated even in China and Europe. However, this cannot be made a reality and be expanded at scale without supportive carbon regulations.
Biofuels and electro fuels
With crude-oil prices skyrocketing, market shares for biofuels such as cane and corn ethanol are rising rapidly. Although second-generation cellulosic biofuels have proved harder to make than many had hoped five years ago, innovative start-ups focused on cellulosic and algae-based biofuels are starting to create high-margin specialty chemicals and blendstocks, generating cash now and suggesting a pathway to deliver biofuels at much cheaper rates in the next couple of years. Furthermore, biopharmaceutical researchers are developing electro fuel pathways that feed carbon dioxide, water, and energy to enzymes to create long-chain carbon molecules that function like fossil fuels at one-tenth the cost of current biofuels.
About the Client
The client, a leading player in the US energy market, was finding it difficult to analyze competitive developments such as expansions, business agreements, product launches, and acquisitions in the renewable energy space. This prompted them to approach Infiniti Research to leverage its expertise in competitive intelligence to develop a competitor analysis template.
The Business Challenge
The energy industry client wanted to leverage Infiniti’s competitor analysis expertise to tactically profile the key players in the renewable energy industry and analyze their growth strategies using a competitor analysis template.
Like the other US industries, the energy industry has shifted its focus from stability to a fluidity as a countermeasure to cope with the ever-increasing challenges. However, our competitor analysis experts suggest that coping with such challenges and exploiting new market opportunities entails adaptation on all fronts. Other competitor analysis strategies include- paying closer attention to the nature of interconnection agreements and regulatory trends in the energy industry. (more…)
Players in the oil and gas industry are constantly pressurized to reduce cost and risks associated with new investments.
The global oil and gas industry has witnessed several disruptions owing to the shift in customer and societal sentiment towards sustainable energy sources. With such factors on the rise, companies in the natural gas segment are increasingly diversifying into alternative market segments and are adopting newer business models to establish themselves and gain a stronger foothold.
Technology adoption has positively impacted the bottom line of companies operating in the natural gas sector. Hence, the need to go digital is clear among major players in the industry and they are increasingly relying upon IoT, big data, AI, artificial, and machine learning algorithms to improve their processes.
Like any other industrial segments, the natural gas segment faces several challenges arising due to a large number of retirements of experienced employees. To overcome such challenges, players in the natural gas sector will have to adopt new approaches to improve operational efficiency and enhance knowledge transfer for the workforce.
The Business Challenge
- The client: A natural gas equipment manufacturing company
To improve their bottom line by enhancing service offerings, the client – a leading natural gas equipment manufacturer – approached Infiniti to engage in a market assessment study. The client wanted to understand the distribution and operation of companies in the natural gas segment. Their primary objective was to evaluate the viability to roll out compressed natural gas to the public transport sector as an alternative to petrol. Also, with the help of market assessment, the natural gas client wanted to gauge the market size in terms of volume.
How Can Market Assessment Help Understand the Oil and Gas Industry?
In today’s rapidly changing market, crucial business issues are converging with repercussions felt across multiple industrial segments. This makes it necessary for organizations to identify and analyze market trends, opportunities, and challenges that impact their business strategies. Our market assessment experts help you determine the growth potential and viability for newer subsegments in the oil and gas industry.
Summary of our market assessment engagement
The solutions offered by Infiniti’s market assessment experts helped the natural gas equipment manufacturer to gauge market feasibility. It also helped the client to identify their key weaknesses and strengths in order to enhance the value of services being offered.
Furthermore, to help the client identify the right distribution channels, the market assessment experts at Infiniti conducted a detailed market survey to help them gain a better understanding of the market. The approach included primary and secondary research methodologies coupled with qualitative and quantitative data collection procedures. The experts also reached out to various stakeholders in the oil and gas industry.
Solution Benefits and the Business Impact
Infiniti’s market assessment experts helped the natural gas equipment manufacturer to identify well-defined metrics for long-term success. Also, with the help of our solutions, the client was able to identify major growth opportunities in the CNG sector. Marketing assessment also helped the natural gas client to enhance their product and service offerings.
The boom of the sustainable energy segment has increased the demand for low-carbon energy, leading to a rise in demand for natural gas as a power generation fuel. Indeed, this sector is growing quickly when compared with oil and coal as a result of which there will be an increase in demand for skilled workforce and innovate ways in which it is extracted, refined, and exported throughout the next few years.
A must-read case study for strategy specialists and decision makers looking to develop an understanding of the oil and gas industry
Spiraling capital costs and the upfront expense of building and maintaining solar energy plants are considered to be major growth barriers for companies operating in the solar energy market.
Over the last few decades, the demand for power has increased manifold across the globe- being driven by the rise in government investments, technological innovations, and consumer demand. Despite the undeniable progress, companies operating in the solar energy sector face major challenges due to factors such as the continuously evolving regulatory framework, execution risks, and the implementation of renewable energy technology.
The deep-rooted nature of innovative technologies also presents a formidable barrier for the global clean energy market. Companies operating in the renewable energy segment such as solar, wind, and other such clean energy sources will have to compete with their peers in the industry to benefit from the existing infrastructure, policies, and technical expertise. Moreover, the high costs associated with the infrastructure tend to make the financial establishments more likely to perceive the clean energy market as risky, loaning money at higher rates and making it difficult for companies to justify their investments.
The Business Challenge
- The client: A solar energy company
To devise a list of key influencers and precisely target the decision-makers in the global energy market, the client – a leading solar energy company – approached Infiniti to engage in a market assessment study. The B2B industrial organization was looking at creating a new business unit that would focus on offering end-to-end solar energy solutions.
The solar energy company wanted to conduct a market assessment study to identify and assess the opportunities in the global energy market. However, their primary objective was to establish a business case for market entry and investment including the recommendation of a go-to-market strategy.
How Can Market Assessment Help Players in the Energy Market?
A market assessment study acts as a great instrument for businesses to gain a detailed understanding of the market in which they operate. Market assessments are not very extensive or expensive when compared with other benchmarking assessments. They offer a quick and precise snapshot of the existing market conditions and also hints at how the future may look like. Also, market assessment studies help business organizations to identify and capitalize on new market opportunities and areas- especially where the enterprise can get a prodigious deal.
Summary of our market assessment engagement
Infiniti’s market assessment engagement helped the solar energy company to focus on market penetration by developing more accurate marketing strategies. The changing market landscape with aggressive competitors posed several challenges for players in the global solar energy market. To help the client assess the opportunities in the global energy market, the market assessment experts at Infiniti conducted a market assessment study that offered valuable insights on decision-making procedures, market trends, and barriers.
The approach included primary and secondary research methodologies coupled with qualitative and quantitative data collection procedures. The experts also reached out to various stakeholders in the energy market.
Solution Benefits and the Business Impact
Infiniti’s market assessment experts offered end-to-end solutions that helped the solar energy company to better align their goals with the market needs. The market assessment study also enabled the client to build a business model to better understand and analyze the potential market opportunities.
The energy company also gained insights on market trends that helped them make necessary adjustments in their design and development approach and product marketing strategies.
The global trend in the solar energy market is the rising use of IoT technologies. Leveraging such technologies not only provides real-time insights but can also brings about major improvements in smart metering; thereby, making the entire process of energy production more cost-efficient. The implementation of IoT ensures that the system is less susceptible to security breaches and productivity issues.
However, companies in the solar energy market should focus on enhancing the development of the connected products, which makes it easier to focus on what’s important for the firm in the most efficient way.
A must-read case study for strategy specialists and decision makers looking to develop an understanding of the global energy market.
The world’s energy needs are constantly on the rise, and power companies are looking at all sorts of possibilities and modes to fulfill the increasing demand. It’s a tough task to produce enough electricity to power the needs of all the people across the world. A traditional source such as fossil fuel has been used on a wide scale as the most significant source of energy. However, due to environmental concerns and increasing emissions, governments across the world are slowly reducing their dependence on fossil fuels and are switching over to a cleaner source of energy. As a result, renewable energy sources have been grabbing the headlines more often. The APAC region has been regarded as the prime example for the adoption of renewable energy sources for their power requirements. Numerous reports estimate the energy demand in the APAC region to nearly double by 2030. The region is on the right path to meet such demands even after reducing their dependence on traditional sources. The Chinese government is expected to move away from energy production from coal, which kills thousands of people each year. So, what does the renewable energy future look like in the Asia-pacific region?
China is a world leader in wind energy generation and has ambitious plans to triple its solar power capacity by 2020. The country is aiming to raise its solar energy generation to 150GW and wind energy generation to around 250GW by 2020. Although the renewable energy sources accounted for approximately 14% of Chinese power, they expect to increase this figure to 22% by 2020. In 2017, China announced to scrap their plans to build 85 coal-fired power plants and instead pour about $350 billion into renewable energy. Additionally, the authorities reported that the country had exceeded official targets for carbon intensity, energy efficiency, and the share of clean energy source.
Similar to China, in 2015, India also announced their ambitious goal of increasing the renewable energy power capacity to 175GW by 2022. This plan includes increasing the solar capacity to 100GW, wind energy to 60GW, bioenergy to 10GW, and hydropower to 5GW. If they achieve this target, then they will witness a five-fold increase in power capacity in a span of seven years. Currently, India is the fourth largest installer of wind power behind China, the US, and Germany. India has been largely helped by the falling solar installation prices, with the rate falling as low as 4 cents a kilowatt hour to add 250MW of solar capacity in Rajasthan.
The shift towards a renewable energy future seems to be picking up steams in Japan. After the Tohoku earthquake, 2011 Tsunami, and triple meltdowns at the Fukushima nuclear power plant, the Japanese government introduced a feed-in tariff system to promote renewable energy. The scheme made it mandatory for utilities to purchase wind, solar, mini-hydro, and geothermal energy at a fixed rate for the specified number of years. A report from IEEFA expects Japan’s solar energy to account for 12% of electricity mix by the year 2030. The report also estimates the renewable capacity to reach 159GW by the year 2030.
The success of solar farms in Thailand coupled with positive development in other clean energy resource puts Thailand right on track to achieve its goal to reach the share of renewable energy by more than 37% by 2036. Additionally, the development of ultra-fast charging battery in Singapore is showing a promising renewable energy future as it can charge batteries up to 70% in just two minutes.
To know more about the renewable energy future in APAC region:
The origins of nuclear energy can be traced back to 1932 when physicist Ernest Rutherford discovered that immense amount of energy was released when lithium ions were split by protons from a proton accelerator. After subsequent discoveries from Niels Bohr and Albert Einstein, nuclear energy was able to power nuclear reactor for energy generation. Today, uranium, a common element in the Earth’s crust, is the element of choice for conducting nuclear fission for generating electricity. Going by today’s consumption rate of the element, numerous studies estimate the reserves to last for another 200 years’ worth of supply. Nuclear energy is distinct from any other source of energy and has its own sets of pros and cons.
Advantages of nuclear energy
Continuous electricity generation
Nuclear power unlike other sources of energy is independent of natural conditions. For instance, solar and wind energy is highly dependent on hours of sunlight or wind which doesn’t usually coincide with fluctuating energy demands. A nuclear power plant is generating electricity about 90% of the annual time which is relatively high compared to other forms of renewable energy. In comparison, natural gas generates an average electricity of 50% of the annual time, while coal and wind produce energy at almost 51% and 32% respectively.
A significant advantage of using nuclear power over fossil fuel is the relatively low amount of fuel it is required to produce an equivalent amount of energy. The cost of nuclear fuel, i.e., uranium, accounts for only 20% of the cost of electricity generated. Such high levels of efficiency also make it easier in transportation, handling, and extraction of nuclear fuel and subsequently reduces the overall costs in the supply chain.
Clean source of energy
The only byproduct generated out of a nuclear power plant is used uranium which is safely stored in pools or concrete containers. Unlike other fossil fuel source, it does not emit CO2 causing air pollution and acid rain. Of all the clean energy sources like wind, solar, and hydro, nuclear power is the most significant source of clean-energy generation in the US contributing to 64% of the total output.
Disadvantages of nuclear energy
The radioactive waste generated as a byproduct of nuclear power is hazardous and has to be carefully stored and monitored for several thousand years. Although high-security standard is maintained to store this waste effectively, accidents can still happen with deadly consequences for both humans and nature. A nuclear or radiation accident such as Fukushima Daiichi nuclear disaster, Chernobyl disaster, and Three Mile Island accident have posed serious questions to the safety of nuclear energy.
High capital investment
Although the fuel source of nuclear power, uranium, is relatively low, the cost of electricity is significantly driven by the high rate of initial investment for constructing a nuclear plant. So nuclear plant will have to run for a number of years in order to recoup the initial investment. Additionally, nuclear plants also have a limited life; after expiry, they have to be dismantled. The construction time for a nuclear power plant usually takes 4-5 years with a payback period of over 30 years which is relatively high considering other source of energy.
Fossil fuels can be mined in many parts of the world, which is not particularly accurate for uranium, which is a very scarce resource. Only a handful of countries have uranium ores, and getting the approval from several international authorities is a tiresome process before building a nuclear power plant. As a result, not many countries can depend on nuclear energy to fulfill the energy demand.
To know more about pros and cons of nuclear energy, nuclear power plant, and the nuclear reactor:
Globally, the demand for power is expected to grow by 58% by 2040.
Over the last decade, increasing regulatory pressures have started forcing prominent energy suppliers to shift toward a more decentralized and intelligent energy system. The energy sector, at large, comprises of resources that help sustain the economic development of a country. Growing concerns pertaining to emission reduction, while delivering a stable and secure supply of energy, is compelling companies in the energy market to look for promising alternative renewable resources. In addition, digitization, sturdy economic growth, and greater efficiency will drive the growth of the energy market in the coming years. Although the energy market is expected to witness considerable growth, owing to the growing number of players, some factors may influence its growth over the next few years.
- The transition towards renewable sources: The recent years have witnessed a growing need to reduce carbon emissions while maintaining the quality of the services rendered. Leading companies are facing pressures to shift towards renewable sources to ensure the secure and reliable supply of energy. Also, the growing demand for renewables among the consumer segments is forcing companies to bridge the demand-supply concerns and enhance the supply of the services.
- Digital disruption: While technology is instrumental for improving inter-connectivity between energy systems, it makes such systems more vulnerable to cyber attacks. Prominent technologies such as batteries and gird-embedded generation require more technical expertise; thus, making it essential for organizations to stay up to date and handle large-scale cyber attacks.
- Rebalancing energy and supply demands: With the recent economic recovery, organizations are facing the need for rebalancing the energy and supply demands. Also, stringent government regulations to curtail the use of unconventional resources and improve the efficiency of the products offered are forcing companies to bridge the demand-supply concerns.
To address these challenges and identify the potential opportunities in the energy market, organizations are utilizing market segmentation studies. Market segmentation aims at identifying different groups of purchasers in the market and targeting specific products and services for each segment.
The Business Challenge
- The Client: A renowned energy provider
- Area of Engagement: Market segmentation
The client, a prominent firm in the energy market, wanted to classify the products based on different groups and precisely meet the needs of the customers in the UK. The energy supplier wanted to analyze the market, identify the key segments, and implement a segmentation strategy to deliver the required products and services to each customer segment. With the help of Infiniti’s market segmentation solution, the firm in the energy market wanted to re-align their products and services based on each segment and adequately allocate their marketing resources to meet their target audience’s needs. The primary concern of the client was to profile the key competitors in the UK and their offerings and make informed business decisions.
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To track and target each group, the market segmentation experts at Infiniti followed an extensive research methodology comprising of interviews and discussions with prominent stakeholders in the energy market across the UK. To implement a segmentation strategy, the experts also compiled information from a wide array of secondary sources such as trade shows, paid industry databases, and company presentations in the energy market.
The Solution and the Business Impact
The market segmentation solution helped the client in the energy market segment the market in terms of usage and needs. The solution helped the client design their marketing campaigns such as advertising and media to drive sales and improve market attractiveness. The client in the energy market was able to understand the commonalities in opinions and leverage the use of statistical techniques to profile people with similar attitudes. Moreover, the client in the energy market also sought ways to determine the prominent branding strategies and keep the brand in tune with the customers.
The future of the energy market will be marked by innovations, with a considerable number of players offering energy from renewable sources. The future of the energy market will also depend on public-private collaborations as it will help energy companies achieve sustainable growth.