Asia’s burgeoning smart-grid market is expected to generate $15.83 billion in revenue in 2018, up from just $5.4 billion in 2012, as demand response and energy management systems grow in popularity.
The forecast comes from Frost & Sullivan, which also believes that “Southeast Asia’s desire to switch to smart grids” will fuel smart-grid sales over the next six years.
The market-research company says Asia’s smart-grid market has already been given a huge boost from the rollouts of advanced metering infrastructure in Australasia and smart city projects in North Asia.
As renewable energy usage puts pressure on already stressed networks, however, countries will need to invest in smart distribution control and management systems.
Indeed, smart grid projects in South Korea, Singapore and Japan already appear to be testing distribution generation using photovoltaics, biomass, wind energy and electric vehicle charging.
Meanwhile, the introduction of advanced metering infrastructure in Jeju, South Korea has already reduced energy usage in homes.
“The need to replace aging equipment in the power grid and utilities’ awareness of the benefits of smart equipment and automation systems further enhance the market’s potential,” said Avanthika Satheesh, a research analyst with Frost & Sullivan.
According to the company, Japan and South Korea expect electric vehicles to comprise 20% of total vehicles on the road by 2030, putting additional load on the power grid, especially during peak hours.
Nevertheless, while recognizing the obvious benefits of smart grids, Frost & Sullivan cautions that the high cost of implementation, lack of standardization, and security concerns all pose challenges to their introduction.
In Australia, for instance, consumers have protested about home installations of higher priced smart meters.
Frost & Sullivan urges utilities to work harder at educating consumers about the advantages of advanced metering infrastructure, but remains optimistic.
“The market’s prospects appear bright, as countries in the Asia-Pacific are likely to undertake large-scale projects over the next six years,” said Satheesh.