The availability of a sufficient and clean energy supply is one of the main factors threatening economic growth in the long term. New applications based on electric systems like power electronics offer solutions for energy production, electricity efficiency, and energy savings. Power-electricity-based technology is utilized both with new sources of energy – wind power, solar power, and fuel cells – and in existing industry and public-sector processes. Electric-powered transportation is also growing more common. The market for power electronics has increased and is going to expand by as much as 10% annually. This growth opens opportunities for new players in the market.

The majority of the total cost during the life cycle of electric motors consists of the price of the electricity consumed. Increasing energy costs get consumers interested in energy-efficiency, and pollution is causing governments and authorities to impose greater pressure for energy savings. There is plenty of room for growth for new applications in power electronics. For example, only five percent of squirrel-cage motors are equipped with frequency converters. A substantially higher level of installations would be justified on economic grounds.

The market leaders in electric systems like power electronics are major corporations in the automation and electrical engineering business sectors. Due to increasingly tough competition, many of these global giants are focusing on their core competencies and expertise. For many such companies, not all areas of power electronics are part of the core technology. Also, the cooperation between these companies is expected to increase. Both of these trends will create new joint ventures and spinoffs. For an investor focusing on power electronics, both of these restructuring processes in the market will create excellent investment opportunities in carefully selected areas of power electronics.

Two-digit growth in the clean-technology market and the restructuring needs of the currently fragmented markets are substantial. Power Fund II will invest in early growth and expansion of existing businesses, which can utilize the business management resources, logistics expertise, and business network of VNT Management Oy. Existing networks and an in-depth understanding of the electric systems business will create an excellent base for new growth companies.