The distributed energy resource management system (DERMS) market is expected to register a CAGR of more than 14.5% during the forecast period, 2022-2027. The COVID-19 outbreak in Q1 of 2020 had led to construction and logistics disruptions and further delayed the commissioning of numerous projects. Factors such as the increasing demand for efficient energy management systems, which help in maintaining grid reliability and flexibility of the distributed energy source, and increased penetration of renewable energy sources, which are intermittent and fluctuate over time, are expected to drive the distributed energy resource management systems market during the forecast period. However, the initial cost for setting up DERMS, along with the expansion and up-gradation of centralized grids in developing countries to reach a 100% electrification rate, is expected to hinder the growth of the market being studied.
- Solar PV is expected to be the largest segment of the distributed energy resource management system market during the forecast period, owing to increased solar PV installations globally.
- The adoption of distributed power generation in the low-electrified areas of the African region is expected to act as an opportunity for the market soon.
- North America is expected to be the largest market during the forecast period, owing to supportive government policies for distributed power generation technology and the increasing share of renewables in the energy mix.
Key Market Trends
Solar Photovoltaic (PV) Segment to Dominate the Market
- Solar PV can be located on rooftops or ground-mounted and is one of the largest distributed power sources globally. This segment is expected to drive the distributed energy resources management system with an increase in installed capacity supported by decreasing average installed cost (USD/Kilowatt). Distributed energy resource management systems limit photovoltaic (PV) output in real-time to prevent reverse flows and high local voltages.
- Moreover, distributed generation is economically viable to build, as it requires significantly less capital compared to an equivalent traditional facility. Tax incentives for both solar stations and distributed solar generation are driving distributed solar PV globally. As of 2020, the global solar PV installed capacity was 707.49 GW.
- Further cost reductions are expected to strongly boost PV expansion in China, the majority being utility-scale projects. Distributed solar PV capacity is also expected to increase rapidly, driven by new auctions for commercial and industrial applications and subsidies for residential systems.
- Moreover, India's solar installations between January and November 2021 reached 11.1 GW, up from 3.73 GW in 2020. The total includes utility-scale, rooftop, and distributed generation solar capacity. Hence, with the increased adoption of solar as distributed power, the demand for distributed energy resource management systems is expected to be bolstered.
- India has an ambitious plan of generating 280 GW of sun-fired electricity by 2030 and outlined plans to spend an additional INR 19,500 crore to boost local manufacturing of solar modules. In United States, solar PV investments rose significantly, supported by corporate procurement.
- Therefore, with increased investment in solar PV and changing government regulations, coupled with upcoming projects, the solar PV segment is expected to be the largest market during the forecast period.
North America to Dominate the Market
- North America was leading the DERMS market in 2020 and is further expected to be the largest market during the forecast period, supported by United States and Canada, which have more than a million distributed generation units, in turn driving the demand for DERMS.
- Despite enough power generation and accessibility of transmission and distribution networks, power outages are caused in some areas of the region due to natural disasters, such as flooding and storms. The use of remote power systems, such as DERMS, to regulate distributed energy systems is likely to mitigate the issue.
- Distributed solar PV generation is expected to witness significant growth due to relatively low initial costs and a reduction in service costs, leading to a short return on investment. Many states such as California and Texas have introduced several laws for integrating renewables, such as installing rooftop solar PV, which in turn is expected to the growth of the market.
- As of 2020, close to 300 remote Canadian communities relied on power-generating infrastructure that limits energy security, environmental health, and economic growth. Compared to a traditional central power generator, the faster process of approving and developing a distributed generation system facilitates a quick-off-the-ground electrical system to supplement and extend the use of aging infrastructure, especially in remote areas.
- Moreover, a large share of North American utility needs better ways to manage and control assets in their distribution system. The high penetration of distributed energy resources (DER) is set to play a vital role in achieving emission targets and meeting higher energy demand.
- As per Solar Energy Industries Association 2021, United States installed 5.4 gigawatts (GWdc) of solar PV capacity in Q3 2021 to reach 113.5 GWdc of total installed capacity, which is enough to power 21.8 million American homes. This is expected to create demand for distributed energy resource management systems.
- Therefore, based on the above factors, North America is likely to be the largest market during the forecast period for distributed energy resource management systems.
The distributed energy resource management system market is moderately fragmented. The key players in the market include General Electric Company, Siemens AG, ABB Ltd, Schneider Electric SE, and Engie SA.
- The market estimate (ME) sheet in Excel format
- 3 months of analyst support
TABLE OF CONTENTS
- 1.1 Scope of the Study
- 1.2 Market Definition
- 1.3 Study Assumptions
2 EXECUTIVE SUMMARY
3 RESEARCH METHODOLOGY
4 MARKET OVERVIEW
- 4.1 Introduction
- 4.2 Market Size and Demand Forecast in USD billion, till 2027
- 4.3 Recent Trends and Developments
- 4.4 Government Policies and Regulations
- 4.5 Market Dynamics
- 4.5.1 Drivers
- 4.5.2 Restraints
- 4.6 Supply Chain Analysis
- 4.7 Porter's Five Forces Analysis
- 4.7.1 Bargaining Power of Suppliers
- 4.7.2 Bargaining Power of Consumers
- 4.7.3 Threat of New Entrants
- 4.7.4 Threat of Substitute Products and Services
- 4.7.5 Intensity of Competitive Rivalry
5 MARKET SEGMENTATION
- 5.1 Technology
- 5.1.1 Solar Photovoltaic (PV)
- 5.1.2 Electric Vehicles
- 5.1.3 Microgrids
- 5.1.4 Other Technologies
- 5.2 End User
- 5.2.1 Industrial
- 5.2.2 Residential
- 5.2.3 Commercial
- 5.3 Geography
- 5.3.1 North America
- 5.3.2 Europe
- 5.3.3 Asia-Pacific
- 5.3.4 South America
- 5.3.5 Middle-East and Africa
6 COMPETITIVE LANDSCAPE
- 6.1 Mergers and Acquisitions, Joint Ventures, Collaborations, and Agreements
- 6.2 Strategies Adopted by Leading Players
- 6.3 Company Profiles
- 6.3.1 General Electric Company
- 6.3.2 Siemens AG
- 6.3.3 ABB Ltd
- 6.3.4 Schneider Electric SE
- 6.3.5 Engie SA
- 6.3.6 AutoGrid Systems Inc.
- 6.3.7 Doosan Corporation
- 6.3.8 Open Access Technology International Inc.
- 6.3.9 Mitsubishi Electric Corporation
- 6.3.10 Emerson Electric Co.
7 MARKET OPPORTUNITIES AND FUTURE TRENDS