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Utilities around the world are investing billions of dollars to deploy and implement smart grid technologies to modernize their operational and information systems. These initiatives promise to transform the power grid, enabling utilities to monitor, analyze and synchronize their networks to improve reliability, availability and efficiency. According to a recent report from Pike Research, smart grid data analytics - which examine raw data from smart grid sensors and devices along with other forms of operational data and external third-party data - are a crucial part of fully realizing these investments.

Smart grids cannot be considered smart without the intelligence to act to correct deficiencies in the power delivery system, including transmission, substations, the distribution system and, ultimately, the customer side of the meter, the report says. A fully optimized utility depends on an enterprise-wide approach that meets both technical and business challenges related to smart field equipment, communications systems, data management, cyber security, data privacy, and the analytics that solve the complex and demanding problems of the utility, in a timely and accurate manner.

“Data analytics are the next level of intelligent network control and planning,” says senior research analyst Bob Lockhart. “The application of smart grid data analytics is challenging, because it involves collating and analyzing data from many internal sources, plus integrating non-structured data from external sources such as demographics, social media, emails and images, to effectively support decision making. Simply analyzing well-structured meter and monitoring data may no longer be enough to understand how a utility can improve its business.”

Technology challenges
Innovation still plays a large role in the smart grid data analytics market, the report says. Better, more-effective products, processes, technologies and ideas are emerging quickly and driving transformation and change. Despite the fact that other markets like telecommunications and manufacturing have solved many of the fundamental technology challenges, including networking communications and scale, Pike Research says utilities provide a service that requires optimal solutions for reliability and resiliency, yet are often burdened by regulatory and spending constraints.

The electrical grid has been called one of the greatest machines on earth, and the industry has unique challenges, including rising fuel costs, societal concerns about climate change, growing demand and an aging infrastructure, the report adds. The fundamental nature of the grid is changing to meet these challenges by integrating renewables and automating systems for optimal efficiency.

Increasingly, large numbers of technologies, from smart meters to smart devices, are being deployed to modernize the grid, and a variety of high-performance technologies are required to recognize return on investment and meet the unique challenges that are inevitable with smart grid data analytics.

Technology considerations for the implementation of smart grid data analytics introduce risk, given the breadth and impact that energy informatics brings to bear on the utility operation. According to the report, this is not a straightforward technology-buying decision for information technologists because of the wide distribution of data sources and the fact that stakeholders across the organization - including executives, financial-legal, accountants, analysts, energy traders, field operators, IT, OT, customer service, procurement and technicians - will want access to varying forms of analysis. The delivery of this data will be just as varied through dashboards, complex visualizations, general reporting, alarms, alerts, modeling and statistical analysis, simulation, and time series analysis.

Perhaps the most important part of implementing data analytics is to realize that it is not a technology problem; it is about changing business and business processes while finding the right technology to meet those needs, Pike Research explains.

Extremely large and complex collections of data are often called “big data.” Big data technologies in the utility must support varying demands, including stream processing, parallel processing, summary indexing, data exploration and visualization. These systems are quite costly, despite their potential value to the utility enterprise. However, the report says the data deluge will be unrelenting, and big data technologies must succeed in order for any smart grid data analytics strategy to prosper.

The future of energy delivery is interactive. Smart grid data analytics is about taking data and creating consumable information for stakeholders to work with, analyze, discover and take action at the presentation or edge tier, the report continues. Analytics can be automated, used to understand what happened and what is happening now, help understand relationships among data, comprehend outcomes and potential outcomes, and develop high-value actionable strategies. These are most often done in the context of business, grid and customer analytics.

Market forecast

According to the report, smart grid data analytics is still an emerging market that is expected to grow rapidly, even given a forecasted slowdown in meter deployments and economic investment, because of growth in grid and asset instrumentation, as well as renewables integration. The growing number of devices on the smart grid will generate a flood of data that must be analyzed if valuable and actionable information is to be derived that will save money and improve operations.

Overall, Pike Research says the worldwide market for smart grid data analytics is expected to grow steadily through 2020, with cumulative worldwide spending through 2020 totaling just over $34 billion.

The Asia Pacific region will see early growth rates of over 50% and an overall CAGR of 25%, with the bulk of the spending in the world markets. The report says this is driven by China’s aggressive deployment of smart meters and its attendant infrastructure, though at this point, it is unclear which drivers will be most important to that nation in deploying analytic solutions. As those drivers become more understood, Pike Research says it is possible that opportunities in Asia could grow at an even faster rate than currently anticipated.

Latin America, the Middle East and Africa, due to their overall low penetration rates of smart grid technologies, will experience mid-forecast rates exceeding 60%. Given the 20-20-20 mandates in Europe and the continuing penetration of advanced metering infrastructure (AMI) (estimated to be approximately 80% by 2020), Pike Research forecasts that adoption will progress heartily for smart grid data analytics solutions in the European region. Europe will hold a slightly stronger share of the market in 2020 than it does today.

In North America, despite lowered projections regarding AMI deployment, more electric utilities in this region are expected to adopt smart grid technology as they expand on their existing smart grid operations, driving a strong demand for data analytics. In addition, pressure and policy to raise caps on renewables integration will drive uplift in the analytics market in North America in 2017, the report adds.

North America will continue to steadily progress, as utilities work to integrate home area networks into their sphere of control. Many meters, especially in North America, provide networking capability that can reach into the customer’s side of the meter for command and control of in-home devices. Even while the forecast trend normalizes, the report says the continuing growth in the North American region can be attributed to the fact that the U.S. has a very large addressable utility market of 3,273 utilities.

This article was adapted from Pike Research’s “Smart Grid Data Analytics” report. For more information on the report, click here.

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