Sourcetoday 454 Alternativeenergy 1

Distributors Hone In On Alternative Energy Markets

April 3, 2012
As distributors sharpen their focus on energy markets, many are playing up traditional strengths in IP&E while branching out into new and complementary solutions designed to meet engineers’ growing needs.

Energy markets represent big opportunities for distributors these days, especially as alternative energy solutions become more affordable and popular. Although the debate over fossil fuels versus alternatives rages on—especially in the United States—many businesses and consumers remain focused on finding cleaner, more efficient, and sustainable solutions to their energy consumption needs.

As the market expands, distributors are making sure they are there to provide the components and services designers and manufacturers require. For examples, look no further than the recent formation of energy-focused business units at many major distributors. Future Electronics’ Future Energy Solutions (FES) group is one. FES was formed in 2009 to mirror the success of its Future Lighting Solutions group, which has a track record of more than 10 years serving the LED market.

Using Future Electronics’ global footprint as a backdrop, FES combines a traditional distribution model with focused energy-market expertise and an eye toward adding complementary products and solutions to meet customers’ changing needs, says Danny Miller, Future Electronics’ corporate vice president and head of FES. Future has redeployed personnel and hired new talent to develop its energy-market focus.

“These European companies traditionally have their business in Europe, but as those markets decrease they are looking for new outlets around the world,” says Danny Miller, Future Electronics’ corporate vice president and head of FES. “We’ll help a Spanish company do an installation or with product and service expertise in India or South America, because I have a team in place in both of those regions.”

Mouser Electronics has launched two alternative energy-focused microsites at within the last year. The first is a solar microsite that highlights the latest products and technologies available to designers and manufacturers of solar products and equipment. The second is an energy-harvesting site focused on new technologies and product developments in that space. 

Energy harvesting is the process of taking energy from external sources such as solar, wind, and thermal and using it to power small wireless devices. Large catalog distributor Digi-Key has expanded in this area as well, introducing an energy harvesting TechZone (the distributor’s online information source covering six different end markets/technologies) within the last year.

“We’re trying to partner with our suppliers as they come out with new products that address alternative energy or energy harvesting because we want to be the first to have it on the shelves,” says Mouser’s Kevin Hess, vice president of technical marketing. “There’s a lot of interest and I think a lot of people are trying to learn what they can about all the different alternatives out there. If we can educate them in any way, that’s what we want to do.”

Such efforts are aimed at capturing a bigger piece of the alternative energy pie over the next few years and developing a reputation among engineers and purchasing agents as a go-to source for alternative energy needs.

Solar And IP&E

For Avnet Electronics Marketing, the solar market represents the largest opportunity in alternative energy today. Chuck Delph, Avnet EM’s senior vice president of sales, points to the market for photovoltaic (PV) inverters in particular. PV inverters are used in solar installations to convert dc electricity coming off the solar panels into the home or electric grid. Delph points to demand for traditional interconnect, passive, and electromechanical (IP&E) products such as connectors, inductors, capacitors, and industrial batteries for use in this process.

“Within the solar market, the PV inverter market is attractive, as it has applications in residential, commercial, and light industrial installations,” says Delph. “We consider it an important market for IP&E.”

The market also demands complementary products and solutions, such as wireless modules for sense and control and remote applications. Delph expects the opportunity to supply such products to remain solid, pointing to steady growth in PV inverter installations in recent years. Regionally, China is pegged as the fastest-growing solar market, but Delph points to the United States as a growth region as well—especially looking forward to 2013.

“Most experts believe China is the fastest-growing market for solar,” Delph explains. “Growth in many other regions of the world is largely tied to government incentives. Last year in Europe, many government incentives expired and growth fell off. Here in the U.S., some government incentives have not been renewed for 2012, so the same could happen here. However, the industry is expecting renewed incentives in 2013, so the future is getting brighter—if you’ll pardon the pun.”

Expanding Their Reach

Future’s Miller agrees that demand for alternative energy solutions is spreading globally. Historically, Europe represented approximately 70% of alternative energy consumption, he says. But that is changing.

“Now we’re seeing growth in other regions—most notably the U.S., India, and certainly all over the world, including South Africa and South America,” Miller explains.

FES is using its parent company’s global reach to support both suppliers and customers around the world, combining its product knowledge with local market expertise to help companies expand to new areas. This has been especially helpful to European customers, whose local business has decreased as alternative energy markets have matured in that region. Miller points to a customer in Spain that FES is helping to expand into India and Peru as one example.

“These European companies traditionally have their business in Europe, but as those markets decrease they are looking for new outlets around the world,” Miller adds. “We’ll help a Spanish company do an installation or with product and service expertise in India or South America, because I have a team in place in both of those regions.”

Keeping up with growing technologies is another necessity. Although FES is focused on providing alternative energy customers with its traditional components and solutions, Miller says many alternative energy customers’ needs go far beyond the usual offering. FES is regularly adding new products and solutions to its inventory as a result, especially when it comes to meeting demands in new areas such as smart meters and Smart Grid technology.

“As we have developed this division, we have been and are constantly on the lookout for new, innovative products to supply our customers to help them achieve their goals,” says Miller, pointing to FES’s recent partnerships with companies such as wireless technology provider Sierra Wireless and EnOcean, which provides energy-harvesting wireless sensor technology for use in buildings and industrial installations.

“These are examples of franchises we felt were needed and what our customers were looking for in some of these segments,” Miller says.

Looking ahead, Miller and others expect the alternative energy market to continue its evolution, especially as the cost of some of these technologies—particularly solar energy—declines.

“The way we’re looking at it is, we still view this as a growth market and we want to make sure we’re participating in that market as much as we can,” Miller says.

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About the Author

Victoria Fraza Kickham | Distribution Editor

Victoria Kickham is the distribution editor for Electronic Design magazine, SourceESB and, where she covers issues related to the electronics supply chain. Victoria started out as a general assignment reporter for several Boston-area newspapers before joining Industrial Distribution magazine, where she spent 14 years covering industrial markets. She served as ID’s managing editor from 2000 to 2010. Victoria has a bachelor’s degree in English from the University of New Hampshire and a master’s degree in English from Northeastern University.