A new report form ARC Advisory Group on turbine monitoring and controls finds it to be a dynamic segment ripe with product innovation.
“This market has tremendous opportunities with steady growth driven by replacement of legacy turbine monitoring & controls with new features such as the growing demand for smart connected products based on the Industrial Internet of Things (IIoT),” said Tim Shea, Senior Analyst, ARC Advisory Group. “The drive for process manufacturing productivity growth is pushing companies to invest in new turbine monitoring and controls for various process industries applications driven by trends such as digitalization and IIoT.”
ARC’s market report reveals that the overall worldwide market for controls for all three turbine types (gas, steam, water/hydro) was just over $1 billion in 2019. There is expected to be a dip in 2020, but by 2024, the market will have grown to little short of $1.5 billion.
“The impact of Covid-19 pandemic and other trends such as a slowdown in China and continued pressure on oil and gas prices caused ARC to forecast a decline in revenues in 2020,” said Shea. “We anticipate a recovery in most countries starting in earnest in Q4 and into 2021 and beyond. The market will continue to grow at a steady growth rate as more customers replace legacy turbine control systems to improve operational performance and increase energy efficiency.”
Control innovation adds value to turbomachinery operations
The turbomachinery monitoring & controls industry has evolved from a field comprised of isolated specialists to a technology with much wider adoption across different industries and applications. Advances in data quality, software processing, and ease of use continue to increase the value proposition for end users, added Shea. He said market drivers include growing demand for energy, an increased focus on energy efficiency, greater demand for products derived from chemical, petrochemical and manufacturing processes requiring mechanical drive of compressors or pumps.
The movement from analog or mechanical controls to digital technology, for example, has enabled operators to realize greater operational performance with fewer resources via remote monitoring, predictive maintenance, asset management and lifecycle optimization.
New software and software platforms have enabled enhanced functionality without necessarily requiring “rip and replace” of current technology. This has also had the benefit of reducing the amount of hardware that needs to be replaced while avoiding a complete rewrite of all code. The cloud, too, is gradually invading the turbine controls space.
“While still a relatively nascent market, ARC expects demand for cloud deployments expected to grow as users realize benefits of scalability, enhanced analytics capabilities for turbine and balance of plant real-time visibility and flexibility,” said Shea. “Of course, this all depends on robust cybersecurity.”
He believes smart wireless sensors are the tip of the spear in any digital roadmap. Wireless sensors support easy scalability, lower costs, access to more remote locations, and an optimized form factor relative to wireline.
“The benefits offered by newer technologies for turbine monitoring and control include greater performance, energy efficiency, and output, as well as improved turbine uptime and availability, and reduced maintenance costs,” said Shea.
Many suppliers offer new monitoring & controls solutions that incorporate advanced analytics or remote monitoring and services designed to help owner-operators and end users to optimize turbine performance, improve energy efficiency, lower costs, and optimize their process operations. Shea has advice for both suppliers and users: Suppliers should develop strategic plans that ensure value propositions that justify higher pricing; users should seek out suppliers willing to invest sufficient time, resources, product development, customization, support, and training necessary to enable successful deployment and operation of the turbine and its optimization during the life of the project.
“Demand for turbine monitoring & controls service-based solutions is expected to outpace that of hardware and software-based solutions over the forecast period as a growing number of operators and end user firms decide to outsource some or all of the turbine monitoring & controls,” said Shea. “Demand for service-based revenues will be most heavily concentrated in the U.S.”
Oil & gas investing in controls
Although the oil & gas segment has been experiencing a recent downturn in oil prices, the impact on turbine monitoring & controls aftermarket/retrofit solutions was somewhat muted. This was due to the continued demand from the midstream segment. This segment relies heavily on mechanical drive for compression to transport hydrocarbons to the end user in the form of electricity, gas heating or air conditioning, or even natural gas-powered vehicles. The more recent severe adverse impact of the COVID-19 pandemic on demand for oil and a plethora of supply created the perfect storm that caused near record declines in oil prices. This has affected sales of solutions designed to service upstream and midstream customers. However, the decline has not been severe.
Simultaneously, though, the chemical and petrochemical markets, especially in the U.S., have seen increasing demand due to cheaper feedstock. In addition, there has been growing demand for plastics and other materials and products that rely on chemical or petrochemical derivatives. This had had a positive effect on demand for on-site power and mechanical drive for compression, and associated controls.
“Demand for mechanical drive for compression is strong in the refining space as low oil prices have helped increase margins,” said Shea.
In the upstream and midstream oil and gas segment, investment continues to go into the digitalization of rotating equipment control such as in compressor and pump stations. ARC Advisory Group research shows that only 18% of asset failure is age related. The other 72% could be addressed by proactive or predictive maintenance. However, a shortage of trained personnel resources challenges many firms.
ARC Advisory Group noted services such as mCloud’s AssetCare asset management platform that collects real-time and historical data directly from assets and moves those data into the cloud. The system performs heuristics and uses artificial intelligence to detect issues and provide insights and guidance to help asset owners optimize asset performance.
You can read a more in-depth report about the Turbomachinery Controls and Instrumentation market in the July/Aug 2020 print edition of Turbomachinery International.
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