The global PV monitoring market became slightly less fragmented last week after inaccess acquired Sense One Technologies.
Both firms are headquartered in the U.K., which is the primary market for Sense One. Inaccess also monitors a diversified portfolio of projects in southern Europe and the United States. In GTM Research’s recent report Global PV Monitoring: Technologies, Markets and Leading Players, 2013-2017, inaccess was ranked 5th and Sense One was ranked 7th among independent PV monitoring vendors in 2012, based on megawatt total.
The combined entity would take the 4th-place spot in the same period, surpassed only by leading German providers Solar-Log, meteocontrol and skytron energy. After the acquisition, inaccess announced a new combined managed fleet of 1.5 gigawatts as of December 20. The rankings for 2013 are still not available, due to high growth and profound changes in the geographic spread of new PV installations.
At first glance, this acquisition may look like a pure market share consolidation play, but there is another dimension to the move.
Inaccess is primarily a technology company, with SCADA monitoring software and a hardware platform originally developed for the telecom world that evolved to serve the needs of a fast-growing solar industry. Sense One focuses on software catering to the fleet management and analytics needs of large solar portfolio owners. So the overlap between both solutions is only partial, with one geared toward technical monitoring of individual plants and the other toward fleet-level management. There are similarities to Also Energy's acquisition of DECK Monitoring in October, which gave birth to a new leader among independent monitoring vendors in the U.S.
In the meantime, SAG Solarstrom, a German project developer and owner of independent monitoring and O&M firm meteocontrol, filed for insolvency on December 13. In our report on the global PV monitoring market, GTM Research and SoliChamba Consulting named meteocontrol the global leader among independent PV monitoring providers for the utility-scale segment in 2012.
One can reasonably assume that SAG Solarstrom’s financial trouble stems from its new power plant business being highly dependent on a declining German PV market, but the situation could also impact meteocontrol’s monitoring and O&M businesses. Although the insolvency news happened too late in the year to influence the 2013 numbers, uncertainty around SAG Solarstrom’s future may prompt some of meteocontrol’s clients to explore alternatives in 2014.
Both SAG Solarstrom and meteocontrol manage operations & maintenance (O&M) for large portfolios of solar plants -- a total of 526 megawatts as of mid-2013, according to GTM Research’s new report, Megawatt-Scale PV Plant Operations and Maintenance: Services, Markets and Competitors 2013-2017. The report highlights the difficulties among engineering firms and developers in Germany, which are commonly creating separate business entities for O&M activities. This makes it likely that the O&M business can survive as a standalone entity if the project development business faces financial difficulties like those experienced by SAG Solarstrom.
In other words, no matter what happens to the EPC side of the firm, its O&M business should emerge relatively unscathed -- except if the company’s O&M contracts allow customers to exit without penalties in case of insolvency. Such terms are mandated by certain solar investors, although one can only guess whether they are part of SAG Solarstrom or meteocontrol’s existing contracts. But with constant downward pressure on O&M prices in Germany and beyond, the firm’s clients would certainly welcome the opportunity to renegotiate older contracts at current market rates.
Both PV monitoring and PV O&M markets remain extremely fragmented overall, and we should see more consolidation happening in 2014 -- along with more bankruptcies.
For in-depth analysis of the competitive landscape, market size and trends in the PV monitoring market, read Global PV Monitoring: Technologies, Markets and Leading Players, 2013-2017. For more details on the competitive landscape, market size, prices and trends in O&M of PV plants above 1 megawatt, see Megawatt-Scale PV Plant Operations and Maintenance: Services, Markets and Competitors, 2013-2017.