IDC Energy Insights is one of the top research firms in the energy sector. Annually it publishes its top 10 predictions for the North American energy and utility sector. Jesse Berst, well known smart grid consultant and founder of Smart Grid News, has reviewed the IDC predictions, prepared his own top 9 predictions, which in some cases agree with IDC and in others disagree. It is interesting to see where the two overlap.
Agree
- Distribution automation spending will continue to accelerate.
- Smart building technology will become more important to utilities.
- Utilities will invest in analytics to manage big data.
- More electric vehicles will be sold in 2012.
- Lithium ion large format batteries will become much cheaper by year-end.
- Solar PV growth will continue at 25% or more in spite of the government grant programs expiring.
Different perspectives
- Jesse sees municipals and rural coops driving new AMI deployments, where IDC expects smart meter deployment to peak in 2012, and demand response becoming increasingly important.
Disagreement about top priorities
- Jesse sees utility mergers accelerating.
- Jesse predicts that electric power demand will flatten or even fall.
- IDC sees IT spending by North American utilities increasing by 4.5% over the next four years.
- IDC sees increasing budgets for security and risk management.
- IDC sees commercial PV operations investing in micro-inverters or DC optimizers.
Below are listings of the top energy and utility priorities from the two sources.
IDC Energy Insights top 10 predictions for energy and utilities
#1 – Smart meters will peak in 2012, propelling demand response, but spending tempered for now
#2 – Distribution automation will lead smart grid control investments with 13% CAGR
#3 – Smart building technology investments will gain more traction with utilities
#4 – 120,000 plug-in electric vehicles will be sold in North America in 2012
#5 – Lithium-Ion large format batteries will reach $600 per kWh by the end of the year
#6 – Despite the 1603 Treasury Grant expiring in 2011, PV installations will grow by >25% in 2012
#7 – >60 MW of commercial PV installations will incorporate micro-inverters or DC optimizers in 2012
#8 – Security and risk will continue to grab decision maker’s attention, leading to increased budgets
#9 – Utilities will invest in analytics in anticipation of big data
#10 – IT spending by North American utilities will increase by 4.5% % over the next four years
1. Utility mergers will accelerate.
2. Demand will flatten or even fall. After decades of sure, steady growth, consumption growth in North America has flattened and may begin to fall after 2012. This could force a difficult adjustment in an industry that has come to expect growth in consumption.
3. Municipals and co-ops will drive new AMI deployments. Their focus will be communications networks that can handle next territories (urban and rural). And that can handle multiple applications for multi-utilities (electric, gas, water).
4. Distribution automation spending will continue to accelerate thanks in part to short payback periods (18 to 36 months typically).
5. Utilities will invest heavily in analytics to manage Big Data. Utilities are getting large volumes of data from smart meters. Now they're trying to figure out how to get business value from that information. And how to use it for "real-time" trading and "real-time" operations.
6. Smart buildings will become important to utilities. 25 states have energy efficiency standards or targets. Smart buildings can help meet such goals. The building energy analytics market will double between 2012 and 2015, jumping from $193 billion to $402 billion.
7. 2012 is the make or break year for electric vehicles. That is when we will be able to see whether they will go mainstream anytime soon.
8. Grid-scale lithium-ion battery prices will plunge. Prices are not cheap yet, but they are already half what they were two years ago, with further big drops on the way.
9 Solar PV growth will moderate, falling to roughly 25% per year. It appears current grant programs will be allowed to expire, reducing the incentives to install solar PV.
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