Global Power Distribution Automation Market To Hit US$10 Billion

The power distribution automation market is growing fast due to various benefits but it still faces challenges.
Published: Thu 26 Feb 2015

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The revenues of global power distribution automation market, which reached US$7.32 billion last year, are estimated to hit US$10.33 billion in 2018, according to a new Frost & Sullivan analysis.

The ‘Analysis of the Global Distribution Automation Market’ states that with power interruptions resulting in huge economic losses of up to US$150 billion annually, distribution automation is presenting itself as a viable solution to enable better asset management, minimal power interruptions, and improved efficiency in the power grid network as a whole.

Last year, Engerati published a live webinar presentation, Closing the Gap Between Smart Metering and Distribution Automation with Transformer Level Measuring, presented by Patricio Villard, Vice President Product Management CISG, Landis + Gyr, which pointed to the wide ranging benefits of distribution automation including the identification and minimizing of technical and non-technical losses, amongst others.

Due to the clear benefits of distribution automation, it is very quickly becoming a requirement for utilities, the report points out. Power demand and grid complexity will continue growing and utilities across the globe are turning to advanced automated solutions to protect assets, enhance reliability, and minimize operations and maintenance costs.

Distribution automation in emerging countries

The report points out emerging countries especially hold significant potential for distribution automation vendors.

“In India, transmission and distribution loss is estimated at over 20% of produced power, while in Latin America, power distribution loss is estimated at over 16%. Hence, governments are urging utilities to adopt automation solutions and boost grid efficiency.”

India is expected to invest the largest amount in traditional transmission and distribution development investment. This is mainly in response to the country’s non-technical losses which in certain areas average 25% - 55%. [Engerati-Power Losses-A Thing of the Past?] The country is expected to outpace China by 2024 with its transmission and distribution developments. [Engerati-The achievements and lessons learnt by India compared with other developing markets.]

Distribution automation still facing challenges

Apparently, the high initial costs of automation solutions restrain the uptake of distribution automation solutions. While this is not surprising, it is hoped that utilities will recognize that the efficiency gains will be higher than the initial monetary outlay. [Engerati – Efficiency Gains Will Trump Cost Concerns, Says Report.]

Integration of different types of vendors, including information technology providers, communication network suppliers and hardware suppliers is also crucial to create products that prepare automation companies to meet future demand.

Distribution automation is in the early stages of its lifecycle and investments in complementary technologies enabling two-way communication, better asset management, and improved efficiency will help capitalise on the full potential of the technology, explains the report.

“The combination of technologies will yield significant benefits for all stakeholders.”

The report points out that the lack of integrated demonstration projects and universal standards are dissuading utilities from investing in distribution automation. The report suggests demonstrating the superior operational benefits of these solutions will be vital for market growth.

Further reading

Frost & Sullivan - Analysis of the Global Distribution Automation Marke