MarketsandMarkets has released a new report indicating that the Internet of Things (IoT) in the utility market is expected to be worth US$11.73bn by 2020.The market research report segments the market into analytics, security, smart grid management, predictive asset maintenance and CIS & billing systems.
The value of IoT in the utility market currently sits at US$4.63bn and is forecast to grow to US$11.73bn by 2020, at a Compound Annual Growth Rate (CAGR) of 20.4% (2015- 2020).
According to a company release, the surge in demand for Internet of Things solutions in the utility sector can be largely attributed to the increase in operational efficiency with less infrastructure investment, as well as integration of existing technology solution and hardware over a common platform.
It adds that the declining cost of IoT components and regional government initiatives for smart grid rollout are some of the driving factors boosting IoT in the utility market.
The report finds that: "IoT is eliminating barriers and allowing the utilities target large audiences and enabling new business opportunities and delivery models."
IoT segmentation and regional growth
MarketsandMarkets notes that the ‘IoT in utility market’ is segmented into analytics, security, operations, smart grid management, predictive asset management, customer information system (CIS) and billing systems.
Trends in mobile, cloud and smart services, together with predictive analytics for business, conducive platforms for analytics and end-to-end automation are contributing toward accelerated growth in the market.
The report also segments the IoT in utility market by region, including North America, Europe, APAC, Latin America and Middle East and Africa (MEA).
In terms of regional growth, North America is expected to witness the highest market growth between 2015 and 2020.
Drivers in the North American market are smaller co-operative utilities allocating funds for IoT deployment, and a regional government initiative to offer low interest federal loan for large water infrastructure projects to utilities.
The Asia-Pacific region (APAC) is fastest-growing region after North America, as a result of public and private partnership models developed for the infrastructure re-development in the major parts of the APAC region.
"Asia Pacific (APAC) is expected to experience extensive growth opportunities in the next few years,” says the report.