northeast group, llc
Emerging Markets Smart Grid: Outlook 2016 BRICS Central & Eastern Europe Eurasia Latin America Middle East & North Africa Southeast Asia Sub-Saharan Africa January 2016 | www.northeast-group.com
Emerging Markets Smart Grid: Outlook 2016 Northeast Group’s Emerging Markets Smart
Emerging markets smart meter potential
Grid: Outlook 2016 is the fifth edition of its
10
annual emerging markets smart grid overview.
9
This study looks ahead over the next decade to
8 7 6
developing countries. To-date, most smart grid
5
investment has been concentrated in developed
4
countries. This mainly includes countries in
3
North America, Western Europe, and East Asia.
2
These markets represent nearly 83% of the current installed base of smart meters and
Potential benefits
project where smart grid investment will occur in
Ready for investment
Strong potential; awaiting government action
Not yet ready, but will progress throughout decade
1 0
1
2
Activity imminent, but some risk involved
Regulatory framework
0 3
4
5
6
7
8
9
10
many of the pioneering distribution automation, analytics, home energy northeast group, llc!!
Emerging Markets Smart Grid: Outlook 2016 10!
Nigeria'
rest of the developing world are positioning themselves to quickly catch up.
Poten2al+benefits+
management, and other smart grid initiatives. But many countries in the
8! 6! 4!
PopulaBon:!178,721,000! GDP/capita!at!PPP!(2015):!$6,185! GDP!growth!(Avg.!2015U2019):!4.5%!
2!
Nigeria! Ghana! South!Africa! Regulatory+Framework+
0! 0!
2!
The 50 countries in this study have all begun to explore smart grid deployments, and in many cases have advanced regulatory frameworks and extensive pilot projects in place. With GDP growth rates more than
8!
10!
Smart!meters!are!an!explicit!goal!of! 2! industry!restructuring,!but!no!official! target!
2026!split:!PLC:!18%;!RF:!70%;!Cell.:!12%!!
Pilot!projects!
3!
Leading'distribu2on'u2li2es'
Funding/ financial! incenBves! Technical! standards! Deployment! plans!
Credited!Advance!Payment!for! 3! Metering!ImplementaBon!(CAPMI)!! should!help!fund!deployments!
Smart!meters!(2015):!183,086!
There!are!six!private! generaBon!and!11!private! distribuBon!uBliBes.!There!is! a!single!stateUowned! transmission!uBlity.!
6!
Smart!meter! target!
Total!meters:!6,788,097! ResidenBal!meters:!6,094,580!!
GeneraBon! ! Transmission! ! DistribuBon!
4!
Regulatory'framework'
Industry'structure'
UBlity!
Customers!
Sales!(GWh)!
Ibadan!
1,159,336!
NA!
Benin!
737,270!
NA!
Ikeja!
670,832!
NA!
All!uBliBes!currently!acBve!in!piloBng! smart!meters!
0! No!technical!standards!to!date! 2! UBliBes!developing!deployment!plans!
The!President!approved!the!NaBonal! Major! Integrated!Infrastructure!Master!Plan! infrastructure! 3! (NIIMP)!for!the!country!to!run!from! !!!!!!!!!=!50Ucountry!!!!!!!!!! Demand7side*benefit*poten&al* investment! weighted!average! 2014!to!2043! Electricity!consumpBon/capita! CO2!target! 4! 45%!reducBon!by!2030! Electricity!prices!
Smart'grid'business'case'indicators'
10!
%!Technical!and!nonUtechnical! losses!(most!recent)!
South! Africa!
40%!
!
!
na
0! No!relevant!DG!incenBves!
EV!incenBves!
0! No!incenBves!
Outreach! program!
0!
Outreach!has!been!limited! !
Further'detail!
30%! 20%! 10%! 0%! Ghana!
Opera&onal*benefits*
H'
Frequent!meter! reading!errors!have! led!to!losses!and! complaints.!
M' L'
Nigeria!
Financing*mechanisms* Government!funding! available!through!CAPMI! scheme.!
Sources:!EIA,!IMF,!NERC!
non-technical losses – mostly due to electricity theft – that cost in
Distributed! generaBon! incenBves!
The9*reduc&on*
High!
infrastructure investment. Many of these countries suffer from rampant
0!
Percentage!T&D!losses!
South!Africa!
Emerging market countries can reap immediate benefits from smart grid
5!
Gh a
0!
!A fric a!
1,000! Ghana! Nigeria!
grid modernizations.
Cents/kWh!(most!recent)!
15!
2,000!
Nig eri a
these 50 countries will have the funds available to undertake significant
20!
3,000!
uth
kWh/person!(2014)!
4,000!
So
double those in the developed world (4.8% per year from 2015 – 2019),
AMI' • First!notable!deployments!in!2015,!with!tenders!for! over!300,000!meters!in!near!term! • Credited!Advance!Payment!for!Metering! ImplementaBon!(CAPMI)!scheme!expected!to!fund! millions!of!prepaid!meter!deployments!in!coming!years! • 5!uBliBes!already!have!deployment!targets!of!over! 100,000!meters!and!up!to!2!million;!there!are!no!set! AMI!targets,!but!some!prepaid!meters!could!have!smart! funcBonality!in!the!medium!term! ' Grid'applica2ons' • Basic!SCADA;!some!transmission!investment!to! incorporate!new!generaBon,!but!no!set!smart!plans! ' Home'energy'management/distributed'genera2on' • HEM!remains!undeveloped;!some!solar!potenBal!
Emerging Markets Smart Grid: Outlook 2016 | Sub-Saharan Africa
© 2016 Northeast Group, LLC
197$
aggregate $63.1 billion dollars each year in lost or unbilled revenue. Furthermore, all of the countries in this study face high rates of electricity demand growth, straining existing infrastructure, and worsening already unreliable electric grids. The findings from this study show that 40% of the countries are already ready for significant investment in smart
Chinese vendor AMI activity
grid
infrastructure.
This
means that they not only have welldeveloped regulatory frameworks,
Linyang purchases equity stake in Lithuanian vendor Elgama
but
also
have
the
underlying
market conditions (through high T&D loss rates, high electricity Wasion (in partnership with Siemens) carrying out projects in Brazil and Mexico
Hexing purchases Brazilian vendor Eletra
Star Instruments active in much of SE Asia Sanxing active across Africa and the Middle East
residents) to justify smart meter deployments.
Other
smart
grid
initiatives will follow smart metering, with distribution automation the Countries with active AMI projects served by Chinese vendors
Source: Northeast Group
© 2016 Northeast Group, LLC
prices, and enough high-income
second largest overall segment
($49bn from 2016 to 2026). In addition to regulatory frameworks and T&D loss rates, further key criteria
Market share of leading meter hardware vendors in Latin America
for assessing smart grid potential include existing
1%
industry structures, current electricity prices (and
14%
whether or not they are subsidized), financing mechanisms, the potential for operational benefits,
0% 35%
4%
and other efficiencies. Of the 50 countries, almost all of the Central & Eastern European (CEE) countries studied meet these criteria, while some countries in Latin America, Middle East & North Africa, and Southeast Asia do as well. Meanwhile, the other
0% 44%
countries in this study show the potential to progress quickly over the course of the coming decade.
*Note: This is a forward looking market share and includes both installed bases of AMI meters as well as announced contracts.
Source: Northeast Group
Additionally, regional organizations and regional leaders will help drive progress across these emerging markets. The EU, ASEAN, and GCC have all been critical in facilitating smart grid cooperation, while countries such as Brazil, Singapore, and the United Arab Emirates already serve as regional leaders. As smart grid deployments are likely to show distinct characteristics in emerging markets that differ from existing deployments in developed countries, these regional leaders will be critical in developing models that can be used by countries with similar drivers and barriers. Perhaps most significantly, 21 of the 50 countries in this study have some form of smart meter target. In the cases of CEE countries such as Estonia, this is already leading to large-scale deployments and full smart meter penetration can be expected in the near term. In other countries, the targets serve as guides or only mandate deployments to high-consumption residents. In all cases though, these targets are pushing regulators to adopt complimentary regulations that will drive the smart grid market. Additionally, smart meter pilots have already begun in many of the other countries where there are not yet targets. As a result, the overall smart meter penetration rate for the 50 countries in this study is expected to reach 61% by 2026. Key questions answered in this study: •
What are the key themes for the global smart grid market in 2016?
• •
What smart grid activity took place in emerging markets in 2015 and what is expected for 2016? What is the forecast market for AMI, distribution automation, wide area measurement, home energy management, and IT in each emerging market region? How do emerging markets compare to developed countries in forecast deployments? Which countries were most active in developing smart grid-related policies and which countries took a step back? Who were the leading international vendors in emerging markets in 2015? What is their market share in emerging markets? Who are the most important local vendors? Which emerging markets countries have the most developed smart grid regulatory frameworks? Which of these 50 countries have the potential to reap the most direct benefits from smart meter deployments?
• • • • •
© 2016 Northeast Group, LLC
Table of Contents
i. Executive Summary
1
ii. Themes for 2016
7
ii.i Theme 1: Smart meter roadmaps are now materializing into tenders
7
ii.ii Theme 2: Lower GDP growth rates are diminishing some long-term potential
8
ii.iii Theme 3: Chinese vendors are becoming increasing active in AMI markets
10
ii.iv Update on 2015 themes
12
iii. Methodology
13
1. Introduction
19
2. Global overview
28
2.1 Smart meter potential in emerging markets
28
2.2 Developments in 2015
34
2.3 Business case drivers
38
2.4 Regulatory drivers
42
3. Emerging markets smart grid market forecast
49
4. Vendor activity
56
4.1 Leading meter hardware vendors
56
4.2 Leading communications-only vendors
65
4.3 Local and other metering vendors
68
4.4 Leading distribution automation vendors
68
5. Regional and country summaries
75
6. BRICS
78
6.1 China
82
6.2 India
84
7. Central & Eastern Europe
86 © 2016 Northeast Group, LLC
Table of Contents (cont.)
7.1 Bulgaria
90
7.2 Croatia
92
7.3 Czech Republic
94
7.4 Estonia
96
7.5 Hungary
98
7.6 Latvia
100
7.7 Lithuania
102
7.8 Poland
104
7.9 Romania
106
7.10 Slovakia
108
7.11 Slovenia
110
7.12 Turkey
112
8. Eurasia
114
8.1 Kazakhstan
118
8.2 Kyrgyzstan
120
8.3 Russia
122
8.4 Ukraine
124
8.5 Uzbekistan
126
9. Latin America
128
9.1 Argentina
132
9.2 Brazil
134
9.3 Chile
136
9.4 Colombia
138
9.5 Dominican Republic
140 © 2016 Northeast Group, LLC
Table of Contents (cont.)
9.6 Ecuador
142
9.7 Mexico
144
9.8 Paraguay
146
9.9 Peru
148
9.10 Uruguay
150
9.11 Venezuela
152
10. Middle East & North Africa
154
10.1 Bahrain
158
10.2 Egypt
160
10.3 Israel
162
10.4 Jordan
164
10.5 Kuwait
166
10.6 Lebanon
168
10.7 Oman
170
10.8 Qatar
172
10.9 Saudi Arabia
174
10.10 United Arab Emirates
176
11. Southeast Asia
178
11.1 Indonesia
182
11.2 Malaysia
184
11.3 Philippines
186
11.4 Singapore
188
11.5 Sri Lanka
190
11.6 Thailand
192 © 2016 Northeast Group, LLC
Table of Contents (cont.)
11.7 Vietnam
194
12. Sub-Saharan Africa
196
12.1 Ghana
200
12.2 Nigeria
202
12.3 South Africa
204
13. Appendix
206
13.1 List of abbreviations and acronyms
206
13.2 List of companies mentioned in this report
209
List of Figures, Boxes, and Tables
Emerging markets smart grid: key takeaways
5
Emerging markets smart meter potential
6
Notable emerging market AMI tenders in 2015
7
Key smart meter tenders and announcements in emerging markets
8
GDP growth projections for 50 emerging market countries
9
Electricity meter market growth in emerging markets
9
Chinese vendor AMI activity
10
Comparison of China with other emerging market regions in AMI growth
11
Update on 2015 themes
12
Northeast Group smart grid forecasting model
17
Figure 1.1: Smart grid value chain
19
Figure 1.2: Smart grid model highlighting focus in emerging markets
20
Figure 2.1: Global smart grid activity
28
Figure 2.2: Smart grid regulatory country index
29
Figure 2.3: Smart grid potential benefit country index
30
Figure 2.4: Emerging markets smart meter potential
31
Table 2.1: Biggest shifts in regulatory framework score
35
Table 2.2: Biggest shifts in potential benefit score
35
© 2016 Northeast Group, LLC
List of Figures, Boxes, and Tables (cont.)
Figure 2.5: Biggest positive movers in smart meter potential
36
Figure 2.6: Largest installed base of AMI meters
36
Figure 2.7: Notable smart meter activity in 2015
37
Figure 2.8: Average electricity prices by region
38
Figure 2.9: Annual GDP growth (2015 – 2019)
38
Figure 2.10: Global T&D losses
38
Figure 2.11: Per-capita electricity consumption
38
Figure 2.12: T&D losses by % and dollars lost
39
Figure 2.13: Annual electricity demand growth
40
Figure 2.14: Typical number of outages per month (SAIFI)
41
Figure 2.15: Typical duration of outages per month (SAIDI)
41
Figure 2.16: Smart meter targets in emerging markets
43
Table 2.3: Smart meter funding mechanisms
44
Table 2.4: Outside smart grid funding bodies
44
Table 2.5: Smart meter interoperability standards in Europe
45
Table 2.6: Electricity network spending in emerging markets (2014 – 2020)
46
Figure 2.17: CO2 emissions targets in emerging markets
46
Figure 2.18: Renewable energy incentives in emerging markets
47
Table 2.7: Types of electric vehicle incentives
48
Figure 3.1: Emerging markets smart grid forecast by region
49
Table 3.1: Emerging markets smart grid forecast by region
50
Figure 3.2: Regional electricity meter market sizes in 2016
50
Figure 3.3: Regional electricity meter market sizes in 2026
51
Figure 3.4: Smart meter deployments in emerging markets by communications
51
Table 3.2: Emerging markets smart grid forecast by segment
52
Figure 3.5: Emerging markets smart grid forecast by segment
52
Table 3.3: Emerging markets distribution automation forecast
53
Figure 3.6: Emerging markets distribution automation forecast
53
Figure 3.7: Global AMI forecast comparison
54
Figure 3.8: Global smart grid forecast comparison
54
Figure 4.1: Market share of leading vendors in 49 emerging markets
56
Table 4.1: Leading international smart meter hardware vendors
57
© 2016 Northeast Group, LLC
List of Figures, Boxes, and Tables (cont.)
Table 4.2: Leading Chinese meter vendors
65
Table 4.3: Leading communications-only vendors
65
Table 4.4: Additional hardware vendors active in emerging market smart meter projects
68
Figure 4.2: Market share of leading vendors in BRICS
71
Figure 4.3: Market share of leading vendors in Central & Eastern Europe
72
Figure 4.4: Market share of leading vendors in Eurasia
72
Figure 4.5: Market share of leading vendors in Latin America
73
Figure 4.6: Market share of leading vendors in Middle East/North Africa
73
Figure 4.7: Market share of leading vendors in Southeast Asia
74
Figure 4.8: Market share of leading vendors in Sub-Saharan Africa
74
Figure 6.1: Smart meter potential in BRICS
78
Figure 6.2: Average electricity prices by region
79
Figure 6.3: Annual GDP growth (2015 – 2019)
79
Figure 6.4: Global T&D losses
79
Figure 6.5: Per-capita electricity consumption
79
Figure 6.6: Market share of leading vendors in BRICS
80
Figure 7.1: Smart meter potential in Central & Eastern Europe
86
Figure 7.2: Average electricity prices by region
87
Figure 7.3: Annual GDP growth (2015 – 2019)
87
Figure 7.4: Global T&D losses
87
Figure 7.5: Per-capita electricity consumption
87
Figure 7.6: Market share of leading vendors in Central & Eastern Europe
88
Figure 8.1: Smart meter potential in Eurasia
114
Figure 8.2: Average electricity prices by region
115
Figure 8.3: Annual GDP growth (2015 – 2019)
115
Figure 8.4: Global T&D losses
115
Figure 8.5: Per-capita electricity consumption
115
Figure 8.6: Market share of leading vendors in Eurasia
116
Figure 9.1: Smart meter potential in Latin America
128
Figure 9.2: Average electricity prices by region
129
Figure 9.3: Annual GDP growth (2015 – 2019)
129
Figure 9.4: Global T&D losses
129 © 2016 Northeast Group, LLC
List of Figures, Boxes, and Tables (cont.)
Figure 9.5: Per-capita electricity consumption
129
Figure 9.6: Market share of leading vendors in Latin America
130
Figure 10.1: Smart meter potential in Middle East & North Africa
154
Figure 10.2: Average electricity prices by region
155
Figure 10.3: Annual GDP growth (2015 – 2019)
155
Figure 10.4: Global T&D losses
155
Figure 10.5: Per-capita electricity consumption
155
Figure 10.6: Market share of leading vendors in Middle East & North Africa
156
Figure 11.1: Smart meter potential in Southeast Asia
178
Figure 11.2: Average electricity prices by region
179
Figure 11.3: Annual GDP growth (2015 – 2019)
179
Figure 11.4: Global T&D losses
179
Figure 11.5: Per-capita electricity consumption
179
Figure 11.6: Market share of leading vendors in Southeast Asia
180
Figure 12.1: Smart meter potential in Sub-Saharan Africa
196
Figure 12.2: Average electricity prices by region
197
Figure 12.3: Annual GDP growth (2015 – 2019)
197
Figure 12.4: Global T&D losses
197
Figure 12.5: Per-capita electricity consumption
197
Figure 12.6: Market share of leading vendors in Sub-Saharan Africa
198
In addition to the figures and tables shown above, each country summary includes the following: Table: Industry structure; Table: Regulatory framework; Chart: Regional smart meter potential; Chart: Regional electricity consumption per capita (kWh); Chart: Regional electricity prices (cents per kWh); Chart: Regional T&D losses (%). Therefore, this study includes an additional 128 unique charts and tables in addition to those cited above.
© 2016 Northeast Group, LLC
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