The worldwide digital power utility market is expected to increase at a CAGR of 23.4% from $55.02 billion in 2021 to $239.38 billion by 2028. The increasing adoption of digital technologies and the growing demand for efficient power management solutions drive this remarkable market growth.
The COVID-19 epidemic in the first quarter of 2020 has significantly reduced global electricity consumption. It has also resulted in decreased energy industry investment and the postponement of current projects.
During the forecast period (2022-2027), factors such as increasing electricity generation and energy demand consumption, particularly renewable energy, will likely boost the digital power utility market. However, rising distribution and transmission network running costs will likely hinder the digital power utility market throughout the projection period.
Rise In the Renewable Energy Sector and Drive for Renewable Integration Market for Digital Power Utilities
Several nations' change from traditional power-centric to renewable-focused policies has considerably increased energy from renewable sources' contribution to the digital power utility market. The increasing adoption of digital platforms is the next great transformation to affect the power sector, and renewable energy production is an early user of this technology.
Along with various other benefits, digitalization can aid in integrating variable renewables by allowing networks to better match energy consumption to periods when the sun shines and the wind blows. By generating better incentives, digitalization can help to accelerate the growth of distributed energy sources such as residential solar power plants and storage.
Rising Demand in North American Markets Fuels Growth in the Digital Power Utility Market
North American countries like the United States and Canada are among the first to use digital platforms to boost power utilities. Due to digital transformation, utilities in North America are changing their business, operations, and information models.
Furthermore, the North American power utility business is very profitable, and any value addition to existing services is significant to its customers. With the possibility of a cleaner energy supply from renewables and a spike in natural gas from shale in North America, companies must modify their energy supply mix and innovate to maintain their customer base.
Increased Transmission and Distribution (T&D) Use Drives Market Growth
Digital devices are used rapidly for maximum plant output, reliability, and security in the spread, power production, and supply industries. Effective grids, detectors, and automated meters are digital technologies that offer businesses and consumers a more exact and current time record of electrical use.
These digital devices help to improve the effectiveness, execution, and security regulation, as well as the dependability of electricity generation and distribution. Its outcomes are enhanced preparation, asset management, operation, superior service, and client fulfillment.
Digital Buildings Will Open New Avenues for Energy Efficiency and Improved Power Control
The digitization and technical improvement of budlings will provide opportunities for energy conservation and improved power control. Building sensors should be capable of measuring energy and power consumption, temperature, air quality, and moisture presence and effect, and digital solutions and technologies will be needed for energy efficiency and automated buildings.
Several standards and recommendations for future-oriented integrated investment strategies for building-related digitalization technologies will become more prevalent in new and existing structures.
Power Sector Digital Transformation
The power industry is experiencing a shift toward digital technology with the introduction of digital innovations, including AMI, DERs, and smart grids. These technologies assist in increasing the efficiency and stability of the electricity grid while also allowing utilities to communicate with customers innovatively.
Increased Demand for Energy from Renewable Sources
As the need for renewable energy grows, so does the need for digital solutions to manage their integration into the grid. Digital technology can assist in maximizing renewable energy usage while improving grid dependability.
Increase in Smart Meters
Smart meters are getting more common, opening up new avenues for utilities to communicate with their consumers. Smart meters may capture energy usage data, which can then be utilized to assist clients in managing their energy consumption.
Increased Customer Involvement
Utilities are putting more emphasis on customer involvement, and technological advances are giving utilities new methods to communicate with customers. Digital technology may give clients details on their energy use and new services, including demand response programs.
High implementation costs: Implementing digital power technology might need to be lowered for some utilities.
Worries concerning data security and privacy: When employing digital power technology, there are worries about data security and privacy. As a result, utilities and customers may be unwilling to adopt this technology.
Interoperability issues: There are interoperability issues between various digital power technology and systems. It can make integrating these technologies into current utility systems problematic.
Regulatory issues: The adoption of digital power technology is fraught with regulatory issues. Utilities must adhere to several restrictions, which might make implementing these technologies challenging.
Regional Coverage for Digital Power Utility Market
Because of government backing, various incentives, and national ambitions, Asia-Pacific is the regional hub for the electricity industry. Primary energy consumption worldwide reached 556.63 exajoules in 2020.
Because of major Asian countries' weak electricity transmission and distribution (T&D) networks, power is unavailable in certain isolated and rural locations. The region's governments are investing considerably in constructing the transmission network to supply power to these places.
According to the International Energy Agency, China was the top destination for power sector investment in 2020, owing to the growing need for power in both the commercial and industrial sectors. Furthermore, China's electrical transmission and distribution infrastructure has undergone considerable renovations and alterations to transport more electricity and meet future demand.
Over the last four years, India's energy investment has increased by more than 10%. Renewable investment continued to outpace fossil fuel-based power production in 2020, thanks to the tendering of solar PV and wind projects. It has boosted the digital power utility market throughout the projected period.
The Indian government stated in February 2022 a grant of INR 19,500 crore to stimulate solar module production under the government's flagship Production Linked Incentive (PLI) plan. The main objective was to push the digital power utility business.
As a result of the preceding factors, growing power consumption is likely to favorably influence the digital power utility market throughout the forecast period, particularly in the Asia-Pacific region.
Company Recent Development
Siemens: In January 2023, Siemens disclosed its forthcoming Digital Power Platform. The cloud-based platform provides companies with a set of digital resources to help them enhance the efficiency and dependability of their business.
GE Power: In February 2023, GE Power revealed its new Predix Asset Performance Management (APM) system. The system implements data analytics to assist utilities in identifying and addressing possible asset issues before they create interruptions.
ABB: In March 2023, ABB debuted its new Grid Edge Control Center. The data center is a software system that assists utilities in managing the grid integration of distributed energy resources (DERs).
Considering the volatility of business today, traditional approaches to strategizing a game plan can be unfruitful if not detrimental. True ambiguity is no way to determine a forecast. A myriad of predetermined factors must be accounted for such as the degree of risk involved, the magnitude of circumstances, as well as conditions or consequences that are not known or unpredictable. To circumvent binary views that cast uncertainty, the application of market research intelligence to strategically posture, move, and enable actionable outcomes is necessary.View Methodology