Energy ESO Market Set to Witness an Uptick during 2020 to 2027Posted by Mrudula Anil Karmarkar on April 30th, 2021 The global energy ESO market size is estimated to reach USD 766.43 billion by 2027, registering an estimated CAGR of 18.8% from 2020 to 2027, according to a new report by Grand View Research, Inc. The increasing investment in renewable energy resources to reduce energy-related Carbon Dioxide (CO2) emission is the primary factor fueling market growth. Energy producing industries are shifting toward renewable and nuclear resources. For instance, according to the International Energy Agency, in 2020, energy-related emissions reduced after two years of continuous growth in 2017 and 2018 owing to greater awareness about energy conservation and global warming. Technological advancements are expected to support the market growth in the forthcoming years due to the increasing need for automated, real-time reporting, and analysis of key performance indicators associated with energy plant operations and equipment maintenance. These advancements are further expected to offer advanced capabilities such as hybrid architecture, the Internet of Things (IoT), and smart grid technology in the energy production and plant digitization process. Moreover, the emergence of electronic embedded machinery, which enables data collection, is used for plant and process monitoring, and is reliable in harsh weather conditions in the oil and gas industry, is expected to further fuel the energy engineering service outsourcing (ESO) market growth. The non-renewable segment is expected to witness a slowdown amidst the outbreak of COVID-19 and its economic repercussions worldwide, as energy production and distribution involve challenges related to continuity, productivity, safety, and reliability. However, outsourced engineering services in the renewable energy segment have experienced minimal negative effects owing to favorable government initiatives. For instance, in April 2020, the Ministry of New and Renewable Energy (MNRE), India, sanctioned a must-run status to renewable energy generation plants. The ministry also declared that this status would remain unaffected throughout the lockdown period, which is anticipated to trigger the growth of renewable energy generation projects over the forecast period. Furthermore, the outsourcing firms leverage advanced engineering tools and technologies to serve their clients, which is expected to further fuel the market growth. Partnering with service providers to accelerate Research & Development (R&D) activities has become common in the energy sector. However, Intellectual Property (IP) and security threats are two critical factors restraining market growth. The OEMs and service providers regularly exchange confidential data on project specifications, technologies, and equipment performances to enhance collaboration on development, design, and support. Thus, IP management and data security issues have become increasingly crucial for businesses utilizing outsourcing services. Energy ESO Market Report Highlights
Furthermore, the energy engineering service providers need to compete on the grounds of pricing and their domain expertise to prove beneficial for the energy-producing companies. ESPs are emphasizing the provision of services to address the difficulties experienced while operating in the energy sector. For instance, power fluctuation is one of the major issues connecting wind farms to the power network. Hence, ESI Group, a French provider of virtual prototyping solutions, offers virtual testing technology for windmill operations. Similarly, Altair Engineering, Inc., a U.S.-based provider of product engineering, industrial design, and analytics solutions, offers IoT-based digital transformation services for the energy outsourcing industry. Over the past few months, the COVID-19 pandemic has caused an unprecedented global slowdown. It has also affected the energy sector, thereby delaying the construction of new energy infrastructure and facilities due to equipment delivery problems. For instance, China, being the first country affected by the COVID-19 pandemic, is one of the primary producers of several clean energy equipments, including wind turbines and solar panels. Delivery and installation of energy-related equipment for renewable energy companies have been negatively affected due to the pandemic, which has resulted in the reduced demand for engineering service providers. Have a Query? Ask Our Expert: https://www.grandviewresearch.com/inquiry/450948/ibb In recent years, ESPs have evolved from providing energy ESO services from their headquarters to opening key operations and excellence centers in developing countries. Most leading ESPs provide services for embedded product engineering, mechanical designs, plant layout designs, and digital manufacturing solutions. These firms are principally engineering, procurement, and construction management companies with a global presence. As the industry has evolved from a domestic to a global domain, it has impelled companies to form global delivery systems. The market is witnessing robust growth with numerous domestic and international companies operating across the regions. Moreover, the key market participants are entering into mergers and acquisitions to expand their business presence and sustain the competitive business environment. For instance, in 2017, Altran Engineering, through its subsidiary Altran U.S., acquired Aricent, a U.S.-based design, and engineering service provider. With this acquisition, Altran Engineering aimed to leverage new opportunities and emerging demands from this region. Some prominent players in the energy engineering service outsourcing (ESO) market include:
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