SubsectorsSmart Grid

  • Though the hype has gone out of smart grids (SG), they remain a key component of worldwide future utility initiatives, promising improved grid reliability, loading and security, while paving the way for increased distributed generation (DG) and EV penetration
  • The IEA estimates US$10trn of global electricity infrastructure investment over the next 20 years (50% generation, 50% T&D), with an increasing allocation to SG-related domains; specific projections for SG market size vary widely
  • SG implementation has been led by simple smart meter programs but is increasingly evolving towards complex (digital/”smart”) solutions
  • Key deployment barriers remain interoperability (standards), utility business models & incentives, complexity (interdisciplinary) and cybersecurity
  • Different regions are following different trajectories and strategies
    • an over-burdened grid and IT/communications company/technology heritages place the US at the vanguard of SG deployments
    • SG rollout in the EU has been relatively slow and basic, but is gathering steam
    • China has the most aggressive SG rollout globally, though is a challenging market for non-domestic vendors and is deploying more lagging-edge technology
  • Major multinationals (communications, IT, energy …) are already very active in the SG sector; Internet leaders are entering, but niches exist for innovative start-ups
  • Investor interest has moved from hardware (smart meters, comms …) to software (AI, analytics, apps, cybersecurity, big data …)
  • Despite a slowdown in SG capital raising and M&A activity, strategics continue to look for critical portfolio bolt-ons