According to the latest market study by IDC Energy Insights, smart grid infrastructure investment will increase by 17.4 percent globally -- Compound Annual Growth Rate (CAGR) for hardware, software and services -- from 2010 to 2015 while overall spending will reach nearly $46.4 Billion worldwide in 2015.
The Asia-Pacific region is forecast to experience the most growth in spending with a five-year CAGR of 33.7 percent.
IDC Energy Insights identified 14 smart grid project types to help profile top investment priorities across the various regions of the world. They then reviewed data based on technology type (hardware, software and services), utility ownership (government owned or investor owned) and whether the utilities are electric only or a combination electric and gas.
Utilities across the globe share the same or similar pressures and business drivers to make information and communications technology (ICT) investments in smart grid infrastructure.
However, differences in regional investment profiles are stark in some cases, driven by differences in government mandates, environmental regulations and private sector support.
Utility investments in smart grid initiatives are intended to improve grid reliability, support distributed and renewable energy, reduce operations and maintenance costs, increase energy delivery efficiency, improve system security and enable energy efficiency and demand response.
With these drivers in motion, IDC Energy Insights surveyed utilities in four global regions (North America, Europe, Asia Pacific, and Latin America) to understand the magnitude and timing of ICT investment.
According to their report, in North America, they found widely deployed advanced metering infrastructure (AMI) and smart meter investment leading to high expectations for demand response for 2014.
In the same period, North America distribution automation investments will concentrate on feeder automation, volt/var optimization, and automated fault restoration.
In Europe and Asia-Pacific regions, smart meters and AMI investments carry the sector's growth forward as major project deployments begin later in the forecast period as Europe eyes its 20-20-20 goals -- a 20 percent increase in energy efficiency, 20 percent reduction of CO2 emissions, and 20 percent renewable generation sources by 2020.
In Asia Pacific, the smart metering torch is being carried by China with a goal of deploying 300 million smart meters by 2020.