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Navigant Research sees smart grid as a service markets growing to $6 billion annually by 2025
Written By: Jen Neville
January 24, 2017
On January 24, Navigant Research announced its prediction that the global smart grid-as-a-service market is expected to grow from $1.3 billion in 2016 to $6 billion in 2025.
The research firm looked at a series of SGaaS sub markets including data services, cloud-based software, and fully managed services, while providing forecasts for managed distribution/substation automation, microgrids, distributed energy resources management, advanced metering infrastructure (AMI), demand response, home energy management, and analytics.
According to Navigant, utilities have preferred to acquire their own physical assets and the software required to manage these assets, store all related data in-house, and use their own staff to perform associated business processes. Today, however, utilities are increasingly turning to service-based delivery to help them take a more flexible approach to business processes, mitigating technology risks, and reducing costs while staying ahead of the competition.
Stuart Ravens, principal research analyst with Navigant Research noted: “The monopoly business model allowed utilities to wait for technologies to mature before purchasing them, but with the increasing threat of competition, the potential profits from the Energy Cloud will not wait and first mover advantage will soon be the order of the day, A new, innovative future will require flexibility—such as the ability to scale up and down data center capacity or rapidly deploy software for product development or testing—which lends itself to cloud-based procurement.”
The research firm stressed the need for speedy time-to-market is anathema to many utilities, where historically there was an incentive to be second or third movers, as competition is becoming a more and more important driver for SGaaS.