Pike Research published a report last week analysing the market for smart grid data analytics. The report concluded that the associated software and services will represent one of the largest growth opportunities in the utility sector over the next few years. From a relatively small global market of $356m in 2010, smart grid data analytics will reach $4.2bn annually by 2015. That’s an average annual growth rate of nearly 64%. In 2009 the software part of the market was only slightly smaller than the services segment, but by 2015 services will represent approximately two-thirds of utilities’ total spending for data analytics.
The report points out that as utilities move to the smart grid and as the grid expands with the installation of millions of smart meters and other devices, it’s going to be a challenge to effectively use the flood of data that will be generated. As industry analyst Marianne Hedin, who wrote the report, put it; “Smart grid utilities are evolving into brokers of information. 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.”
As is the case with all ‘new’ markets, it’s fragmented in terms of suppliers. According to the report, among the large IT players there are established companies such as Accenture, Capgemini, HP, IBM, Microsoft, Oracle, SAIC, SAP, Siemens and Teradata. Pure-play companies, mostly with meter data management (MDM) expertise, include Aclara Software, Ecologic Analytics, eMeter, Itron, Olameter, and NorthStar Utilities. And other contenders include companies as diverse as Infosys, OPOWER, OSIsoft, Telvent, and Toyota.
More details of the report and an executive summary are available here.
This is going to be an interesting market that will expand into all sorts of areas of utilities business (and potentially beyond), which is why there are still opportunities for a wide range of suppliers. It’s going to be a case-by-case sell as the utilities establish their priorities and focus, but some of the major players already have broad offerings and lots of experience – see my coverage of Teradata a few weeks ago.
By the way, one of the strengths of The Green IT Review is its vendor neutrality. If anyone we mention in the blog is a current or recent client or we have any business interest in anything else we comment on, then we will say so. To that end, note that I have recently written a research report for Pike Research. It’s not published yet, I’ll tell you more when it is.