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The market for smart-grid-related cloud services will reach $4 billion by 2020, finds a new report from Zpryme.

The report says that although global smart grid technology deployments are reshaping the global energy landscape, they are also poised to challenge the traditional business, information technology (IT), operations and management structures that utilities have grown accustomed to over the past 50 years.

To prepare for such change, Zpryme says that utilities must embrace new business models and operational architectures that will allow them to meet the current and future needs of their customers. Highly scalable and cost-effective cloud solutions will play a key role in allowing both small and large utilities to adapt to such changes.

Cloud technologies have experienced explosive growth in the IT industry, according to the report. Successful applications of cloud technology have been demonstrated in fields ranging from human resources to healthcare and have drawn the attention of utilities worldwide. Many of these utilities have invested substantial amounts of capital in hardware installations, particularly in the areas of advanced metering infrastructure (AMI) and sensor deployments.

Now that the hardware is in place, the report says, utilities are looking for ways to optimize and analyze the voluminous data being generated from these devices. Thus, they are looking to cloud services as a solution to manage their data externally, reduce IT costs, optimize their infrastructure and increase their ability to rapidly scale their solutions to meet their future business needs.

Zpryme’s forecast indicates the market for cloud solutions for utilities will experience dynamic growth over the next eight to 10 years, with an average annual growth rate of 25%. Growth will be moderate in the short term, primarily led by North America and Europe, and accelerated later by the Asia-Pacific region, which has been slower to adopt cloud services.

However, by 2015, the Asia-Pacific region will surpass Europe and will do the same to North America by 2019. By 2020, the Asia-Pacific region will account for the largest share of the global cloud services market. The major application areas for cloud solutions will be in distribution system software and applications, AMI, and data management and analytics.



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