The new monitoring and meter technology, utilities argue, bolster an emerging smart grid infrastructure, saves energy, allows for careful planning and empowers end users to tailor their energy usage to times when power is cheapest. Consumers, however, have yet to embrace smart meters with the ardor shown by the utilities.
The recent past has seen a rash of anti-smart meter lawsuits, demands for opt-out provisions and even claims that smart meters are a dangerous source of radiation or a nefarious tool of Big Brother. However, according to a recent report by a market research group specializing in the energy sector, these objections haven’t stopped utility companies from charging full speed ahead with their plans for the meters. According to the report, smart meters are not going anywhere and the industry, while not quite living up to earlier projections, is in fine health, thank you very much.
The newly released projections, published by IHS Market Research, predict that global shipments of smart meters are expected to triple from 2011 to 2016. Just how many smart meters actually is that? Shipments of the digital meters reached 20.5 million units last year. By 2016, that means that the industry will ship 62 million meters. All of those smart meters have also given a jolt to another, associated, industry: semiconductors. According to IHS, global sales of semiconductors used in these smart meters are projected to grow to $1.1 billion in 2016, up from $505.6 million in 2011.
The rollout of smart meters is being propelled by government support and regulations. For example, in the United States, stimulus money from the Smart Grid Investment Grant program is driving the replacement of conventional meters with new smart models. Meanwhile, the European Union is targeting an 80 percent conversion to smart meters by 2020, representing shipments of 180 million units.
Despite all the government help and the rapid growth of smart meter shipments in the coming years, the industry is not where it was projected to be, deployments actually are progressing more slowly than had been expected from a few years ago and revenue for both the meters and the related semiconductors is expected to flatten starting in 2015. One factor slowing market growth is a lack of money. Amid current economic conditions, investments in smart grids and smart meters are falling short of expectations in many cases.
Another factor, according to IHS, is the old stumbling block – consumer acceptance. Utilities just haven’t done a good enough job selling the benefits of smart meters in particular and smart grid technology in general to consumers. Just showing up and installing the meter isn’t good enough. Instead, the report says, smart meters should be paired with services that deliver more value to consumers, such as a dashboard that shows the electricity consumption of appliances and other devices.