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Worldwide smart meter shipments surpassed 20.6 million units in the fourth quarter of 2012, representing year-over-year growth of 182.7% and a 33.9% increase over the third quarter of 2012 (3Q'12), according to a new report from IDC Energy Insights.

Europe and the International Electrotechnical Commission (IEC) standards market led the first wave of smart metering, beginning with Enel's deployment in Italy a decade ago. The report notes that the IEC market was overtaken by the American National Standards Institute (ANSI) market in 2009, as mandated deployments and American Recovery and Reinvestment Act (ARRA)-funded projects began to gain steam in North America.

In 2012, the report adds, momentum again shifted back toward the IEC markets, led this time by the methodical establishment of smart metering infrastructure in China.

The wave of ARRA projects has crested, and shipments in the Americas continue to decline, falling 10.8% quarter-over-quarter and 47.7% year-over-year. Shipments in EMEA have increased 1.9% over 3Q’12 and 36.6% year-over-year, though growth has thus far proven much more modest than projected by the EU 20-20-20 plan.

Meanwhile, smart meter shipments in the Asia-Pacific region are driving the global advanced metering infrastructure (AMI) market, exploding by 48.9% sequentially and 779.6% year-over-year, the report adds.

Smart metering is rapidly becoming the global standard. Particularly in the ANSI market, few vendors still offer electromechanical meters, while the cost differential between automatic meter reading systems and low-end AMI is rapidly shrinking.

However, IDC Energy Insights says that new projects are proceeding much more cautiously than they have in previous years. Global economic uncertainty has tightened the appetite and ability of utilities to take on debt, and in more developed markets, regulators and consumers are increasingly demanding that utilities demonstrate clear value from their metering infrastructure investment.

This atmosphere of caution and uncertainty has manifested as longer and larger-scale trials and longer horizons for regulatory approval. By contrast, in developing markets, the need to create basic infrastructure continues to drive deployments of smart metering systems; these developing markets, IDC says, will help drive global smart meter shipments in 2013.

In mature markets, projects in situations of clear need, such as TEPCO in Japan, are proceeding more rapidly, while long-debated and -delayed implementations in the U.K., France and Germany are not expected to have a significant impact on shipments until 2014-2015.

"The market for basic smart metering systems continues to expand," says Dean Chuang, senior research analyst for IDC Energy Insights. "Much of the activity we've observed in recent quarters has been targeted toward basic infrastructure and operational issues, such as billing and non-technical loss.

“Conversely,” Chuang continues, “deployments in more mature markets have slowed, as global economic uncertainty has increasingly driven utilities and regulators to reflect upon the near-term cost benefit of AMI deployment. Utilities and vendors are still learning how to communicate the benefits of AMI as foundational infrastructure; we expect activity to pick up as the industry develops experience with AMI and continues to integrate applications beyond billing."

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