Annual expenditures for operations and maintenance (O&M) services in the U.S. wind industry are expected to double from just under US$ 3 billion in 2012 to nearly US$ 6 billion in 2025, according to a new report U.S. Wind O&M Strategies: 2012-2025 by IHS Emerging Energy Research (IHS EER).
O&M’s share of annual U.S. wind expenditures is expected to increase from 12 per cent to 29 per cent over the same period. Larger wind owners are planning to bring more aspects of O&M in-house to leverage economies of scale. At the same time, Original Equipment Manufacturers (OEMs) are aggressively expanding the O&M side of their businesses in part due to expectations that the pace of new turbine orders will decline following the record pace of 2012 installations. The emerging opportunity has also fostered the creation of a host of full service Independent Service Providers (ISPs), aiming to provide more cost-effective O&M than OEMs and owners. The increasingly competitive environment is already beginning to drive OEMs and ISPs to offer new types of contracts and service offerings with a focus on maximizing production, the report says. Production-based availability contracts—which tie O&M compensation to project output—are becoming more prevalent and are anticipated to begin replacing traditional uptime availability guarantees. OEMs and some ISPs are also developing new tools to enhance the production of previously installed turbines as a means of differentiating their offerings.
O&M’s share of annual U.S. wind expenditures is expected to increase from 12 per cent to 29 per cent over the same period. Larger wind owners are planning to bring more aspects of O&M in-house to leverage economies of scale. At the same time, Original Equipment Manufacturers (OEMs) are aggressively expanding the O&M side of their businesses in part due to expectations that the pace of new turbine orders will decline following the record pace of 2012 installations. The emerging opportunity has also fostered the creation of a host of full service Independent Service Providers (ISPs), aiming to provide more cost-effective O&M than OEMs and owners. The increasingly competitive environment is already beginning to drive OEMs and ISPs to offer new types of contracts and service offerings with a focus on maximizing production, the report says. Production-based availability contracts—which tie O&M compensation to project output—are becoming more prevalent and are anticipated to begin replacing traditional uptime availability guarantees. OEMs and some ISPs are also developing new tools to enhance the production of previously installed turbines as a means of differentiating their offerings.
