Smart Grid Sensors Market Expected to Hit $350 Million in 2021, IHS Says

The smart grid sensor market is roughly doubling in size every two years, as electric utilities worldwide are expected to begin large-scale installations of this new technology

Category:

Tuesday, March 17, 2015 8:00 am EDT

Dateline:

AUSTIN, Tex.
"Utilities are altering their organizational structures, to better use information gathered from smart grid sensors, which radically increases the value of sensing devices"

Austin, Texas (March 17, 2015) –The market for smart grid sensors is set to rapidly expand in the coming decade, with revenues growing nearly ten-fold, from 2014 to 2021, according to IHS Inc. (NYSE: IHS). 

Based on information in a new study from IHS Technology, the market for smart grid sensors is centered mainly in North America, where there is a mixture of a few large installations and many smaller pilot projects. Last year, however, IHS observed a series of larger contracts being reviewed in North America, while markets in other global regions also showed signs of potential adoption. A pressing need to monitor the grid in real-time exists, and utilities are expected to gain greater value by installing modern smart grid sensors, which can greatly improve utility operations and performance. 

While still a fairly nascent market in North America, the larger tenders for smart grid sensors support the positive outlook forecast by IHS. The United States market is estimated to reach $30 million in 2014; however, annual growth from 2015 to 2021 is expected to average 36 percent. 

“The United States has been on the forefront of smart grid sensor market development,” said Fizza Arshad, market analyst with IHS. “Many factors have converged to make this happen, but one of the stronger influences was the American Recovery and Reinvestment Act of 2009.” 

The American Recovery and Reinvestment Act (ARRA) provided the investment needed to install extensive grid distribution-layer communications networks. Having affordable, ubiquitous communications networks is essential to making the smart grid sensor story emerge. “The smart grid movement that resulted from ARRA spurred interest from telecommunications providers to see critical infrastructure, like the electric grid, as a potential client base,” Arshad said. Since 2014 some of these larger contracts for smart grid sensors in the United States are going up to a thousand or more units, revealing greater acceptance of the technology.

Source: IHS, Inc. 

While the current market is centered primarily in the United States, Europe, Latin America and other global regions are also forecast to become high-growth markets. In Latin America, utilities are spending time and resources to install pilot programs to aid fault location and theft prevention. 

“Latin America is an untapped market with a lot of potential to grow,” Arshad said. “As the governments in this region take note of the grid problems, more and more policies and utility benchmarking schemes are being put in place to encourage investment in smart grids.” 

In Europe there is a particularly strong need for renewables energy management. The influx of energy from solar and wind is creating a large demand for improved grid monitoring by utilities companies. Greater adoption of smart grid sensors across Europe is anticipated, as utilities will need more granular measurements on the electricity grid, in order to efficiently integrate renewables, while still properly balancing the grid. Since many of these residential solar installations are concentrated in dense, urban environments made up of large underground distribution networks, smart grid sensor growth in Europe is supported by a sharp increase in sales of underground sensors.

IHS forecasts that while the smart grid sensor market only accounted for less than 20 percent of total sensor sales revenues in 2014, they will account for 75 percent of the total sensor market in 2021. The smart grid sensor market is expected to reach the $100 million mark in 2017 and fast-paced growth will continue well into 2021. “A growth of this magnitude shows that smart grid sensors will become widely accepted in the near future,” Arshad said, “and while sensor are not becoming business as usual for most smaller utilities, larger utilities companies will incorporate sensors, as part of their regular purchasing decisions.” 

Going from pilot programs to large-scale installations will bring more examples of successful deployments, further reveal benefits to utilities, and allow for smart grid sensor technology to scale accordingly. “Utilities are altering their organizational structures, to better use information gathered from smart grid sensors, which radically increases the value of sensing devices,” Arshad said.

# # #

About IHS (www.ihs.com)

IHS (NYSE: IHS) is the leading source of insight, analytics and expertise in critical areas that shape today’s business landscape. Businesses and governments in more than 150 countries around the globe rely on the comprehensive content, expert independent analysis and flexible delivery methods of IHS to make high-impact decisions and develop strategies with speed and confidence. IHS has been in business since 1959 and became a publicly traded company on the New York Stock Exchange in 2005. Headquartered in Englewood, Colorado, USA, IHS is committed to sustainable, profitable growth and employs about 8,800 people in 32 countries around the world. 

IHS is a registered trademark of IHS Inc. All other company and product names may be trademarks of their respective owners. © 2015 IHS Inc. All rights reserved.

To read our privacy policy, click here.

Contact:


or
All Industries
IHS Media Relations, +1 303 305 8021
press@ihs.com

Multimedia Files:

Preview image