Asset Management Software Opportunities Lie in Renewable Energy Market

Source: Pixabay

Renewables could be the next goldmine for asset management software vendors as the world ramps up its renewable energy production.

According to the International Energy Agency (IEA) Renewables 2022 report, renewable energy sources are set to overtake coal as the largest source of global electricity by early 2025. Renewables will also account for nearly 40% of global electricity output in 2027. This means a further decline in the shares of coal, natural gas, and nuclear.

Russia’s invasion of Ukraine brought energy security concerns to the fore. The war is now motivating countries to accelerate growth in renewables. Governments are passing legislation, providing incentives, and implementing existing policies to address the energy crisis. If momentum continues, the world could add as much renewable power in the next five years as it did in the past two decades.

Moreover, the report estimates that global renewable power capacity could grow by 2,400 gigawatts over the 2022-2027 forecast period. This increase is about 30% higher than what the agency projected the previous year.

Source: IEA, 2022

Utility-scale solar PV will lead the pack when it comes to the most widely implemented renewable energy sources. Based on the IEA report, solar energy growth will almost triple to 2,350 gigawatts by 2027. Also, solar will overtake hydropower in 2024, natural gas in 2026, and coal in 2027. Experts also predict a rise in the installation of residential and commercial solar panels that can help reduce energy bills.

“This is a clear example of how the current energy crisis can be a historic turning point towards a cleaner and more secure energy system. Renewables’ continued acceleration is critical to help keep the door open to limiting global warming to 1.5 °C,” explained IEA Executive Director, Fatih Birol.

Efficient Management of Renewable Energy Assets

Based on current estimates, there are at least 97.2. billion solar panels installed globally. In the United States alone, the solar market’s average 10-year growth was 33%. Prices of solar panels have declined 52% in the past 10 years and now account for 45% of all new electricity-generating capacity added in the US. Those are just for one type of renewable energy source. Other types of renewable sources like wind, hydro, and geothermal all add to the large and distributed assets that plants or operators need to monitor.

Against this backdrop, vendors can expect the demand for tools to manage renewable assets to also increase. Companies have traditionally relied on spreadsheets to manage various business processes. But asset management for renewables will require sophisticated, cloud-based solutions that can gather and process data that companies can use to ensure the highest possible performance and utilization of their renewable assets portfolio.

Single Platform for Renewable Energy Data

Managing renewable energy assets involves a wide range of data points. These can come from utility meters, monitoring systems, and weather data just to name a few. Also, renewable energy professionals would often need to access market rates and financial data from their company’s ERP software to ensure project information are up-to-date.

Since data can come from multiple sources and enterprise applications, vendors should highlight their platform’s capabilities in synchronizing all technical data from renewable energy assets. Simple and secure integrations with all data sources will be a key consideration for clients to get rid of silos and experience a seamless flow of data.

Automated Workflows

Automation helps increase efficiency. For businesses in the renewable energy market, automated workflows can play an important role in reducing errors, managing contracts and compliance, and conducting preventive maintenance fixes. Vendors that can offer automated invoicing tools could also potentially increase their client base since billing systems can be complex. Automated billing will be an excellent feature as it can generate contract and metering information and create accurate and reliable invoices every month.

Financial Management

Vendors should also highlight financial management tools that users will need for reports, especially for investors and stakeholders. Tools for creating multiple budgets, financial statements, and tracking transactions are essentials that should be included in any modern asset management software.