Utility capital spending plans continue on track


Ellicott City, MD, U.S.A. — (METERING.COM) — January 14, 2009 – In spite of the weakened economic conditions in countries around the world, electric power utilities appear to be proceeding with investments in both their infrastructure and “smart grid” automation programs.

In a new survey by Newton-Evans the majority of the surveyed large public and private utilities were found to be poised to continue their long term capital investment programs as had been originally planned in January 2008. Areas of capital expenditure include advanced metering rollouts and smart grid related programs as well as control systems, substation automation, distribution management, and other distribution and transmission infrastructure.   

The area with the outlook for most significant downward change in capital expenditures was “distribution infrastructure.” On the upside were planned increases for AMI initiatives and for new or upgraded grid control and monitoring systems.

The key reasons for the continued relatively strong investment in distribution and transmission of electricity include regulatory pressure and mandates for service reliability improvements and smart grid initiatives aimed at modernizing the power grid infrastructure and enabling energy efficiencies. In addition there is obsolescence of existing equipment and the long-term investment view to accommodate future growth in electricity consumption. Frequently, utility capital projects are complex and multi-year in nature, so project deferrals are often out of the question, even when the overall economic outlook is poor.

The total amount of capital spending for distribution and transmission of electricity by power utilities around the world is currently estimated to be in the range of $90 – 105 billion. The 2009 outlook overall is trending toward that same range of spending.