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What's in store next year for utilities? A new report from IDC Energy Insights reveals the company's top 10 predictions for the North American utility industry in 2013:

1. Utilities will make outage prevention, readiness and response a top priority in 2013.

2. Smart meter shipments will fall below 9 million units in 2013.

3. In the next five years, consumer spending will transform home energy management.

4. By 2017, 70% of advanced metering infrastructure (AMI) systems will integrate to a distribution control system.

5. In 2013, utility incentives will drive $160 million in smart building technologies, ensuring energy efficiency is here to stay.

6. Utilities have breathing room to plan, as plug-in electric vehicle (PEV) penetration is lower than expected.

7. Utility chief information officers' (CIO) security practices in 2013 and beyond will center on risk management.

8. CIOs’ agenda for 2013 will focus on bringing business efficiencies through information technology (IT) initiatives.

9. In 2013, marketing and customer operations will increase efforts in the social business space.

10. North American IT spending will increase at a 4.92% compound annual growth rate over the five years from 2010 to 2015.

A closer look
Considering the devastation Hurricane Sandy brought along the East Coast, it is no surprise that outage prevention and power restoration will likely be top of mind for utilities in 2013. Following the storm, many customers, regulators and politicians argued that utilities’ planning efforts for - and responses to - Sandy were poor.

In New York, for example, Gov. Andrew M. Cuomo signed an executive order in November establishing a commission to investigate how the state's utility bodies reacted to Sandy. In addition, the state’s attorney general subpoenaed both the Long Island Power Authority, whose chief operating officer resigned following the storm, and Consolidated Edison to participate in a similar probe.

And, of course, Sandy was not the first time regulators turned their magnifying glasses on utilities following a damaging storm: IDC notes in its report that the Connecticut Public Utilities Regulatory Authority said Connecticut Light and Power Co.’s response to Hurricane Irene in 2011 was “deficient and inadequate in the areas of outage and service restoration preparation." Nonetheless, the report also says that there was an improvement in restoration times during Sandy compared to Irene.

IDC Energy Insights says utilities and regulators will likely consider underground transmission lines and upgrades to infrastructure in the months ahead. The report also predicts that utilities’ IT operations and CIOs will play a key role in mitigating weather-related issues by building upon social media efforts to communicate with customers during outages, establishing software innovations to better manage field crews and utilizing predictive analytics to protect critical assets from an oncoming storm.

The report’s No. 2 prediction - that shipments of smart meters will drop below 9 million units next year, down from approximately 11 million in 2012 - may not come as a surprise to the industry. After all, utilities across the U.S. have either already completed or plan to finish their AMI rollouts by the end of 2013, the report says. IDC Energy Insights explains that smart meter shipments saw a huge boost from mass deployments funded by the American Recovery and Reinvestment Act of 2009 (ARRA), and although there will be various new smart grid pilots and deployments throughout North America, the report notes that “these projects will not replace the ARRA surge.”

According to the report’s No. 6 prediction, the utility industry will have “breathing room” in 2013 to prepare for PEV penetration, as the adoption of such vehicles will be well below expectations. IDC Energy predicts that approximately 878,000 PEVs will be sold in North America by 2015; meanwhile, President Obama had set a goal of 1 million PEVs in the U.S. alone by then.

The content of this IDC Energy Insights report was presented as part of a Web conference on Dec. 5. To access a recording of the conference, click here.





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