Billion dollar opportunity in smart grids for public cellular operators by 2020

| April 13, 2012

Mobile operators can tap into a potential market of US$1 billion from the supply of networking services to smart grid deployments, says new research from Pike Research.

According to the market researchers, utilities have so far ignored public cellular networks for their smart grid initiatives, but that is about to change. A confluence of factors is leading a major shift in how utilities view public cellular options as they roll out smart grid infrastructure projects, Pike said.

“Carriers and integrators have awakened to the unique opportunity of the smart grid. It is no longer just another general vertical market application,” says vice president Bob Gohn. “With new pricing and service offerings specifically tailored for the large number of endpoints but relatively low aggregate data volume typical of grid applications, public cellular is becoming a real competitor to private utility-owned networks. The end result is a significant and growing monthly stream of revenue to the carrier, without taxing the carrier’s network resources.”

According to Pike Research, global annual service revenue from public cellular network nodes in smart grid applications will surpass $1 billion by 2020, representing a 27% compound annual growth rate (CAGR) from 2011 to 2020. A cumulative total of 73 million cellular M2M communication nodes will be shipped for use in smart grid applications during the period from 2011 through 2020, the cleantech market intelligence firm finds.

A major factor for the surge is the European Union’s much-publicised 20-20-20 mandate, which aims to reduce EU GHG emission by at least 20% below 1990 levels, deploy 20% of renewable energy for the EU, and a 20% reduction in energy use.

Europe is the leading region for public cellular node unit shipments and revenue through the remainder of the decade, Pike said. Europe will also likely lead the market in annual service revenue, due largely to the sheer volume of aggregate data being sent by the region’s smart meters, as well as the smaller (yet steadily growing) number of nodes being used for applications such as distribution automation and substation automation.

 

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Category: Applications, Global energy, Mobile, Networks, Renewables, Smart grids

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