Power generation markets are in the midst of change – as they have been for a while already. Globally energy consumption is increasing, while the future of conventional power generation is coming to an end within an uncertain timeframe.
The market is now an entirely new ball game, which all players have to adapt to. Luckily, VEO has done well in capturing the new market and 2017 gave great proof of that. Overall, VEO’s sales has grown within power generation and we see this as a result of developing our expertise and our internal processes. We can offer more value to competitive prices and our customers can count on us delivering according to our promises and in time.
Last year was a success for VEO’s oil and gas power business, where our market is global. Worldwide we see many investments in power generation and the future looks bright for us. Last year VEO successfully delivered several large fast-track projects in Asia within a very tight schedule. We also signed contracts for similar large projects in another part of the Asian market. For large fast-track projects VEO has very competitive offerings and we have streamlined our internal processes to meet their demands. The investment rate is high in Asia at the moment with several large projects in the pipeline. It seems the market is now catching up to the previous slow years in the economy.
It seems the market is now catching up to the previous slow years in the economy.
Globally we also see many investments within wind and solar power projects. Through a partnership with a customer, VEO supports an engine-based balancing solution to intermittent renewable energy. For this solution, VEO offers smart control and automation products and services. With a team of 40 automation experts and leading expertise, we can offer the “brains” to monitor the balance between renewables and flexible balancing technology. Also in the Nordic countries, wind power has gained a strong foothold. Wind power plants are being built, subsidized and used in production in all of our three Nordic markets, Finland, Sweden and Norway. The subsidies for wind power lower Nord Pool’s electricity prices, making other forms of power generation non-lucrative for investors. With low investment incentives for conventional power generation, our customers face challenges with obsolete technologies in their older plants. Here VEO has the expertise to adapt old installations to markets with increasing shares of renewables. With our smart digital solutions our customers can run their plants more efficiently, while benefiting from the new opportunities in the energy market.
In hydropower markets, 2017 had the same trends and activities as the previous 2-3 years. Also here, the low electricity prices slow down investments. Just as in previous years, we have, however, been able to maintain our market shares in the Nordic countries. The newly developed Generator Commander, a smart device covering the generator’s or motor’s excitation, protection, synchronization and dimensioning requirements, was extremely well received by the market, making excitation sales in 2017 a great success. VEO has a strong interest in gaining market shares in hydropower and 2018 shows a promising start with markets picking up and many new inquiries coming in.
In thermal power, there are interesting advances within waste-to-energy solutions. Especially the British market has seen a boom in investments in waste incineration, with several large waste-to-energy plants being built at the moment. Hopefully, depending on the subsidies offered, the investments will continue in the years to come. For the electrification needs of these projects, VEO offers turnkey solutions with a full scope of products, planing, project management and installation. With VEO’s acquisition of I.C Electrical (ICE), much of our projects can be executed locally in the UK with support from Finland.
Finally, for our expert services segment, last year was a good one. Markets started picking up in the spring with an increased investment rate, along with higher demand for services, rebuilding and updates. In comparison to the year before, we saw a 50% growth in our expert services. In this segment we have grown every year, but now also the markets are supporting that growth. Last year we were happy to work with several new customers and also had success in technical developments. In addition, we have been successful in harnessing the power and knowledge of our network of suppliers in benefit of our customers. By combining our project management skills with our processes understanding we can offer our customers extensive expertise and value.