With Smart Meter deployments reaching 30% market penetration level, a huge new opportunity for data analytics is emerging. Instead of collecting data once every month, utilities are going to be collecting data 96 times a day or roughly 3000 times per month. This is a 300,000% increase in the amount of customer data that utilities have had before. Converting this data into actionable intelligence will create a multi-billion dollar opportunity. By applying smart analytics and machine learning techniques to the smart meter data, utilities can start to understand their customers' behavior in real-time and take advantage of this understanding to serve them better while improving the efficiency of the grid.
According to a reccent report from Pike Research, the software and services that will enable smart grid data analytics will represent one of the largest growth opportunities in the utility sector over the next few years, increasing from a relatively small market of $356 million in 2010 to nearly $4.2 billion in annual revenue by 2015 with a CAGR of 65%.
Industry analyst Marianne Hedin says the 'data tsunami' that will wash over utilities in the coming years is a formidable IT challenge, but it is also a huge opportunity to move beyond simple meter-to-cash functions and into more robust business intelligence capabilities, true situational awareness with real-time optimization of their operations, and even predictive analytics".
Like most emerging technology sectors, the market is highly fragmented. Large IT companies (such as IBM, Oracle, SAP, Google), traditional power systems provider (such as ABB, Siemens, Areva, GE), specialized consulting firms (SAIC, Accenture, Jacobs, CapGemini, Infosys) and pure-play smart grid providers (Itron, eMeter, Alcara, Ecologic, Opower, Telvent) are all working towards this market but as Hedin puts it "at this stage of the race, the competitive market is wide open".
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