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Although many utilities have been largely focused on rolling out significant numbers of smart meters in their service territories, many others have also seen the value in creating interconnected communications networks that allow them to better manage the distribution grid, according to a recent report from Pike Research.

Moreover, vendors have realized that across the distribution network, a variety of wireless technologies are likely to be put in place, rather than a single, overarching technology. Pike Research says this is a function of both financial pressures and operational efficiency. Most utilities are not going to deploy a communications network with performance capabilities that far exceed their needs, especially if there is a less expensive, adequate solution available, the report explains.

As a result, Pike Research believes most utilities and vendors envision the current and future field area network (FAN) as an amalgamation of a variety of protocols. Some might be owned by the utility, and some might be leased from telecommunications providers - each one selected based on the most suitable performance/cost metrics for the specific application or applications that are being deployed.

Despite this, the report says a single, unified management system will be used to monitor and control these disparate applications, with vendors increasingly designing their equipment to support Internet Protocol-based networking and full interoperability with devices made by other vendors.

Ultimately, Pike Research believes the biggest driver in the development of FANs is the need to increase the safety and efficiency of the utility grid already in place. The report says that utilities have realized that by networking, monitoring and automating various devices in the field (beyond smart meters), they can run a variety of applications that require little or no change in the behavior of their customers.

These applications offer higher returns on investment (ROIs) than for large-scale advanced metering infrastructure (AMI) programs and fast payback, the report says. Moreover, they increase the efficient operation of the grid, improve the reliability of assets in the field, speed service restorations and enhance the security of the grid.

By networking equipment that previously had to be monitored or controlled manually, such as substations, reclosers, capacitor banks and feeders, utilities can respond to minute changes in the state of the grid, Pike Research adds.


While private wireless FANs are seeing enhancements in both overall data throughput and range, Pike Research says utilities are focused on the ability of their vendors to “play nicely” with each other, as well as with older equipment already in the field. Some vendors still position themselves as providing superlative technical performance compared to their competitors.

However, the report says a growing number of vendors are highlighting their expertise and willingness to work closely with utilities to better understand their current and future needs and challenges.

At the same time, these vendors are being supportive of existing technology they already have deployed. Pike Research says that in its discussions with vendors, most have characterized their platform solution as an end-to-end FAN solution, despite primarily gaining experience with one particular application (e.g., smart meters). This approach highlights the overall platform or “master manager” nature of their software solution, the research firm says.

Pike Research anticipates that the large networking vendors, such as Cisco, have the opportunity to be viewed as the true leaders in the platform or master manager space. The vendors with significant experience in providing communications functionality to substations and distribution equipment (e.g., GE Energy and S&C Electric Co.) have a similar opportunity, the report adds.

Despite the increasing availability of newer, high-speed wireless broadband technology such as WiMAX and Wi-Fi, Pike Research projects that the current and near-term future demands for many distribution automation (DA) and substation automation (SA) applications are unlikely to require the very high bandwidth of these technologies.

Nevertheless, the report says it is likely that some utilities will choose these technologies due to their increased range and future capacity. Municipal or cooperative utilities that have a relatively constrained service territory and are looking for a solution that will be somewhat future-proof for the next decade may find the newer technologies particularly attractive.

Ultimately, the process of selecting a technology for a FAN remains a very utility- specific decision, with no singly “right” technology application for all scenarios, Pike Research says. Budgets, service territory size, geographical topography, node density and, most importantly, application utilization are the key criteria strikingly similar to other utility projects.

The market ahead

Pike Research says the market for private wireless FANs is perhaps best measured by node unit shipments and revenue. The report focuses on four primary zones where nodes are deployed:
  • AMI-NAN: AMI-neighborhood area network;
  • AMI-WAN: AMI-wide area network;
  • DA-WAN: Distribution automation-wide area network; and
  • SA-WAN: Substation automation-wide area network.

The report projects the global market to be led by AMI-NAN node unit shipments, driven by smart metering mandates around the world. Shipments hit relatively high volume levels in 2010 through 2012, but will then decline slightly in 2013 to 2015 as a result of the initial metering efforts (particularly in the U.S.) coming to a close.

However, Pike Research says overall shipments will begin to increase again late in the forecast period. Metering mandates in Europe, as well as increasing smart meter activity around the globe, will drive AMI-NAN node shipments. An increased focus on DA and SA in the U.S., Canada and other developed regions will help these node types gain additional share of the private wireless FAN market, the report adds.

Meanwhile, the technology used in the creation of private wireless FANs will continue to be a mixed bag, Pike Research says. While utilities and vendors agree that most of the technologies in use today will continue to be deployed throughout the forecast period, the research firm says it is clear that open-standards-based technologies (e.g., RF mesh 802.15.4 and WiMAX) are gaining favor in the marketplace.

Despite the segmentation presented in the report, Pike Research says it ultimately expects that utilities will wind up deploying a mix of technologies across the FAN. The various applications being run will likely determine the most appropriate technology to use.

Moreover, the report says, with utilities opting for multi-technology, multi-vendor environments, vendors that can provide a platform management solution are likely going to be in the best position to influence the technologies used to network, monitor and control the next decade’s FANs.

For more information on the report, click here.

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