Smart grid security spending to exceed $2 billion by 2016, still major challenges

An estimated $590 million was spent on smart grid security technologies in 2010 and by 2016 that number is projected to surpass $2 billion, according to a report by ABI Research (Oyster Bay, N.Y., U.S.A.).  However, despite this, cyber security challenges are nowhere close to being resolved, and the industry will continue to face a number of serious hurdles in the coming years, says Pike Research (Boulder, Colo., U.S.A.).

 “Utility cyber security is in a state of near chaos,” says Bob Lockhart, senior analyst at Pike Research. “After years of vendors selling point solutions, utilities investing in compliance minimums rather than full security, and attackers having nearly free rein, the attackers clearly have the upper hand. Many attacks simply cannot be defended. That said, Pike Research has observed a dawning awareness by utilities during the past 18 months of the importance of securing smart grids with architecturally sound solutions.”

Lockhart adds that cyber security solutions remain challenging to implement, especially as attackers gain awareness of the holes between point solutions. Pike Research says that the utility cyber security market will be characterized by a frantic race to gain the upper hand against the attackers, while at the same time strong competitors attempt to outdo each other.

In a separate report by ABI Research, the firm says there has been an increased focus on smart grid security over the past few years, which is only going to intensify in the future.

"There has been an enormous focus on smart grid security, particularly over the last two to three years,” says Josh Flood, a senior analyst at ABI.  “As well as providing security protection against physical and cyber-attacks on the smart grid, utilities are spending significant amounts of money on closed-circuit television (CCTV) surveillance and security software."

According to ABI Research, security spending on transmission upgrades made up the largest portion of smart grid spending, accounting for approximately 54% of the total in 2011. This segment is predicted to remain the largest for the next five years. Additionally, security spending on substation and distribution automation is forecast to be significant over the next few years as well.

Electric vehicle (EV) charging stations are projected to see the highest security growth rates out of all the smart grid segments, growing from $6 million in 2011 to $150 million by 2016, says the research firm.  EV charging stations faced similar security issues to smart meters, such as data protection and tampering with the charging stations. The biggest areas of development in the security arena will be EV authentication of vehicles and physical security features.

Smart grid security covers identity management and access controls, threat and theft defense, industrial control system security, smart grid cellular communications, physical safety and security, and other security types, says ABI.

Related Articles

California adopts security standards for smart meters

Report: utility security a concern among U.S. smart grid

ArticleTools

Featured Big Data Reports

Market Opportunity: Big Data in the Internet of Things
Big Data and Analytics software and applications will play a crucial role in making IoT a success. The data generated through sensors embedded in various things/objects will generate massive amounts of unstructured (big) data on real-time basis that holds the promise for intelligence and insights for dramatically improved decision processes.

 

Structured and Unstructured (Big) Data in Telecom Analytics
This report provides the reader with a broad understanding of telecom data (structured and unstructured/big data) and related analytics. The report identifies market drivers and opportunities as well as forecasts for certain key growth areas such as deep packet inspection.

 

Telecom Carrier Big Data Operations, Applications, and Services
Telcos have a major advantage in that they have many sources of data but if they want to monetize that data and derive meaningful, actionable analytics it could be challenging due to the complexities of correlation, prediction, and the massive volumes of data from different sources.

 

Affordable Market Reports on Big Data, IoT, CDN & More!
Access the exclusive new series of market research reports brought to you through the partnership of Mind Commerce research and TelecomEngine.com.
Browse the latest titles

 

 

 

Featured Events & Partners

The Telecom Exchange (TEX)
Wednesday, June 24, 2015

Cipriani Wall Street, New York City

Designed to navigate enterprise and carrier network operators through all carrier hotels and colocation houses available in the US and globally.

Visit event website...