frost & sullivan’s top 10 energy & ict smart trends
DESCRIPTION
Given the increasing interest in convergence between the energy and the IT and Communications Technologies (ICT) sectors, industry participants need to know the requirements and stage of development in order to accurately target their product portfolio. This briefing will list the top 10 global energy and ICT trends and will specifically focus on which trends could have an impact between now and 2020.TRANSCRIPT
Frost & Sullivan’s Top 10 Energy & ICT Smart Trends
Which Technologies and Trends will have a Real Impact on the Smart Grid by 2020?
© 2013 Frost & Sullivan. All rights reserved. This document contains highly confidential information and is the sole property of Frost & Sullivan. No part of it may be circulated, quoted, copied or otherwise reproduced without the written approval of Frost & Sullivan.
Jonathan Robinson, Senior Consultant, Energy & Environment
Yiru Zhong, Industry Manager, M2M & ICT in Smart Energy
2nd October 2013
2
Today’s Presenters
• Yiru is an analyst for the ICT industry, with expertise in Machine-to-Machine and ICT in Energy.
• Jonathan is a consultant in for the energy and environment sector, with a focus on conventional power generation, renewables and smart energy.
Yiru Zhong, Analyst,
Frost & Sullivan
Jonathan Robinson,
Consultant,
Frost & Sullivan
Yiru Zhong: http://www.linkedin.com/pub/yiru-zhong/1/1a2/b46Jonathan Robinson: http://www.uk.linkedin.com/in/jonathanserobinson
@frostsullivan
3
We identified a long list of trends that could impact smart energy by 2020
ProjectedImpact on the
EnergyVertical by
2020
High Impact
Low Impact
Certainty by 2020Low High
Smart buildings -> Smart Cities
Demand Response
Renewable Energy
Electric Vehicles
Distributed Generation
Automation of the Grid
Expansion into Services
Expansion of AMI
Prosumers
Energy Efficiency
High Growth Impact
LowGrowthImpact
MediumGrowthImpact
Enterprise Mobility
Data Security
Cloud Computing
M2M/IoT
IT/OT Convergence
Big Data & Analytics
Distributed Intelligence
Source: Frost & Sullivan analysis
Energy StorageVirtual Power Plants
Cross domain interoperability
Next Generation Networks
Open Source
4
Switches
Solar panel
Industrial plant
Office/ Factory
Small generators and solar panels to reduce demand on the grid
Wind farm
Central power plant
Demand responseCustomers can manage their consumption depending up on the supply conditions
SensorsThese switches are used to isolate areas in case of fault detections
Energy storageEnergy generated during off-peak time is stored in batteries
Current flow
The Grid of the Future is Fast Becoming Closer to Reality
Source: Frost & Sullivan analysis
5
0
20
40
60
80
100
120
North America Europe Rest of World
Reve
nues
($ B
illio
ns) 2011 2014 2017
0 25 50 75 100 125 150
2011
2014
2017
Reveneus ($ Billions)
North AmericaEuropeRest of World
29%
21%
50%
16%
12%
72%
North America Europe Rest of World
Smart Grid Revenue Growth, Key Regions, 2011, 2014 and 2017
Booming Levels of Smart Grid Investment, Particularly in Asia Pacific/China
Smart Grid Regional Revenue Splits, North America, Europe and Rest of World, 2011, 2014 and 2017
2011 2014 2017
Source: Frost & Sullivan analysis
13%
10%
77%
6
Smart Grid Sub-segment Revenue Split, Global, 2011
$27 bn in Smart Energy Investment in 2011, Forecast to Increase to $125 bn by 2017
($9.8bn) ($10.1bn)
($7.8bn)($1.6bn)
Smart Grid Sub-segment Revenue Growth, Global, 2011, 2014 and 2017
Source: Frost & Sullivan analysis
0 25 50 75 100 125 150
2011
2014
2017
Reveneus ($ Billions)
High Voltage AMI
Demand Response Distribution Grid Management
High Voltage35%
AMI25%
Demand Response
6%
Distribution Grid
Management34%
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Top 10 Energy & ICT Trends
Renewable Energy
Distributed Generation
Advanced Meter Infrastructure
Automation of the Grid
Data Security
Enterprise Mobility
Data Analytics
Machine-to-Machine & Internet of Things
IT/Operational Technology Convergence
Expansion into Software and Services
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Renewable Energy: Renewables the fastest growing electricity source
Coal
Oil
Gas
Nuclear
Hydro
Wind
Other renewables
-4% -2% 0% 2% 4% 6% 8% 10% 12% 14%
2020-30 2010-20
Electricity Generation CAGR by Technology, Global, 2010-2030
Renewable Energy Share in Total Generation Capacity, Global, 2010-2030
74%
26%
72%
28%
68%
32%
65%
35%
62%
38%
2010 2015 2020 2025 2030
Renewable energy, incl. hydro power Fossil fuel based generation (gas, coal, nuclear, oil)
Source: Frost & Sullivan analysis
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Distributed Generation: DG drives an increasing defragmentation of power industry landscape
Large C&I customers Mid- to small-scale C&I customers Residential customers
Captive power 1 Captive power (incl. renewables) 1 Own generation 1
A host of new needs above mere gas and electricity procurement:
• Energy consumption reduction
• Optimised energy procurement
• Increased transparency and energy data management
• Renewable energy and self-generation
• Carbon compliance
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AMI: Why is AMI Important?
Consumer Utility
Benefits
Outcomes
means greaterneed for…..
=
Before meters read 1-12 times
a yearNow = 35,000 times a year
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AMI: Strong Global growth, with AMI Market doubling from $8 bn to $16 bn by 2017
Source: Frost & Sullivan analysis
2010 2011 2012 2013 2014 2015 2016 2017Revenue 6237.6 7766.7 7893.9 8238.5 9427.2 11235.3 13683.0 16461.9
Growth Rate 24.5 1.6 4.4 14.4 19.2 21.8 20.3
0
5
10
15
20
25
30
0
2,000
4,000
6,000
8,000
10,000
12,000
14,000
16,000
18,000
Gro
wth
Ra
te (%
)
Re
ven
ue
($ M
illio
n)
Year
Total AMI Market: Revenue Forecast, Global, 2010–2017Revenue CAGR, 2012–2017 = 15.8%,
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Automation of the Grid: Key element at all stages of the smart grid
Automation: Central to the smart grid
13
Global Smart Grid Automation Investment 2011 and 2017
Automation of the Grid: Massive Investment in Global Grid Automation
0
5
10
15
20
25
30
2011 2017
Reve
nues
($ B
illio
ns)
Source: Frost & Sullivan analysis
Different Focus: Europe + North America vs. Rest of World
CAGR 33%
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Enterprise Mobility: Adding Mobility Increases Efficiency and Effective Customer Engagement
Source: www.xcubelabs.com
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Data Security: Data Security & Privacy is Fundamental to Smart Grid Integrity
Smart meter data
Customer: CRM/CIS
Energy: Forecast Load balancing
New
applications
in a smart
Energy
future
Source: Frost & Sullivan analysis
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Data Analytics: Big Data – A Huge Untapped Source of Actionable Insight
Divide & Conquer(or Intercept & Forward)
In-memory Computing(for Real-time Analytics)
Next-Gen
Analytics Engine
Process some data
faster
Derive near real-time analytics
Deploy some data quickly into business
Strip away most for processing & trend
analysis
1
2
BI Platform
3
BIG DATA
Process all data at In-memory speed; derive
real-time analytics ‘on-board’ in RAM
Make all data available to
business users in seconds
Source: Frost & Sullivan analysis
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M2M: M2M Connectivity -> Applications -> Intelligence -> New Business Models
• Using machines to solve ‘who-what-where-when challenges
• Strong demand for data analytics, auditing, compliances and SLA management
• Monitoring, reporting, maintenance and troubleshooting.
• Entire business models built around ‘connected assets’
• Simple reporting and feedback
• Assist in supporting existing business models
• Limited storage and analytics requirements
From Asset Management
Driving Business Efficiency
New Product & Service Innovation
+
+
• Monitoring, reporting, maintenance and troubleshooting.
• Entire business models built around ‘connected assets’
• Simple reporting and feedback
• Assist in supporting existing business models
• Limited storage and analytics requirements
+• Simple reporting and
feedback• Assist in supporting
existing business models• Limited storage and
analytics requirements
End
poin
t M
onito
ring
Com
ple
x R
ules
-bas
ed
Inte
ract
ions
‘Big
Dat
a’ M
anag
emen
t a
nd S
ma
rt C
usto
mer
R
elat
ions
hip
Cu
sto
mer
Val
ue to
to
2009 20182010 2011 2012 2013 2014 2015 2016 2017
Current M2M Focus
Source: Frost & Sullivan analysis
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IT & Operational Technology Convergence: Achieving Greater Operational Efficiencies
Interoperability
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Expansion into Service & Software: Countries/regions are at different stages of development – but some closing in on “maturity” by 2020
Europe
North America
Asia
MaturityDevelopment Growth
Africa
Middle East
Latin America
Time
Lev
el o
f D
eve
lop
men
t
Establishing regulatory climate, incentivising
investment etc.
Focus on investing in equipment and
systems
Services and solutions demanded to satisfy newly
created needs
Source: Frost & Sullivan analysis
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Expansion into Service & Software: Utilities - key element in the new system is customer – residential sector
Past Future
Business model based on .. Product (electricity, gas)Services catering to customer needs and overall experience
Main differentiator Price Scope of services, ease of use, interactivity
VS.
Product-oriented past Customer-oriented future
• The progress is slower in the residential sector but the changes are underway as well with many non-utility companies looking to get into a ‘living room’.
• Utilities will continue to face a tough competition for customers, which are still loyal to their incumbent energy providers – an advantage a few utilities have realised.
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Expansion into Service and Software: Examples of all three strategies present in the smart space
Acquisition: Traditional equipment manufacturers are already expanding into service
Organic Growth: There is also greater internal R&D focus from key equipment manufacturers to improve energy systems solutions e.g SCADA, outage management
Alliances: Being formed across the industry – in some cases to target particular geographic markets
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Conclusion
• AMI, Renewables, Automation of the Grid, Distributed Generation trends = Create a need for ICT companies to sell the energy sector
• Overall huge opportunities for the different stakeholders:
• Energy utilities – challenges, but could need to innovative to maintain positions
• Industrial equipment suppliers – booming investment – but services and solutions coming to the fore
• ICT companies – 3 immediately relevant trends to act on, 2 that requires cross industry collaboration
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For Additional Information
Jonathan RobinsonSenior ConsultantEnergy & Environment+ 44 207 915 [email protected]
Joanna LewandowskaCorporate CommunicationsICT+48 22 390 41 [email protected]
Yiru ZhongIndustry ManagerM2M & ICT in Smart Energy +44 207 915 [email protected]
Chiara CarellaHead of Corporate CommunicationsEnergy & Environment+44 207 343 [email protected]