Water and gas meters play their part
The electricity meter market in EMEA (Europe, Middle East & Africa) comprises more units, generates greater revenues, and is significantly more fragmented in terms of the supplier base, than the gas or water meter markets. Additionally, the quantity of electricity meters used in AMR applications shipped annually in this region dwarfs usage by these other types. Hence it probably should not be surprising that market analyses and general discussions relating to the gas and water meter industries seem less prevalent. These are significant industries, however, and both play important parts in the metering industry as whole.
IMS Research estimates that in 2004, just under 60 million utility meters were shipped in EMEA. This was a watershed year for the industry, as the market began a cycle of contraction in 2005 to more ‘normal’ levels, which will finalise in 2006. The slowdown is attributable to the completion of the ENEL project, which peaked in 2004 and ended in 2005. With electricity metering demand virtually eliminated from the Italian region for the foreseeable future, the total EMEA metering industry can expect to weigh in at around the 50 million unit mark over the next few years.
The data table and figure highlight the relative contribution of the three major utility types to the metering industry in EMEA. What is noticeable is that in 2005, the collective shipments of water and gas meters surpassed those of electricity meters. In fact, by 2006 the number of water meters shipped is forecast to be only slightly smaller than electricity meters shipped.
In contrast, the gas market is under half the size of the electricity meter market in EMEA. It should be noted that underlying growth in the electricity meter market is positive, although the effects of the ENEL project conclusion on market shipments cloud this picture.
Growth for water and gas meters is projected to remain steady at around 2% per annum. While both markets are obviously linked to the rollover of existing metering stock and new housing builds, there are certain structural differences that contribute to limit demand for each. Infrastructure relating to the distribution of water is more widely installed in a large proportion of households than for any of the other utility types. However, the overall total is disproportionately smaller than one would expect, since in many countries water is still often provided un-metered. IMS Research estimates that of the roughly 80% of households in EMEA that are connected to basic sanitation and piped water, just over one-half are actually connected to a meter. Thus the limiting factor for water meter growth is the extent to which water is provided on an un-metered basis.
GAS METER MARKET
In contrast, growth for gas meters is linked to the extent to which gas infrastructure is developing. The relatively small size of the gas meter industry reflects the fact that only about one-third of households in EMEA are actually connected to gas. In some regions gasification is well developed; others, however, and most noticeably in Africa and the Middle East, have very limited gas infrastructure, eliminating demand for metering. While growth for gas as a whole is increasing, actual household growth in total EMEA is predicted to outstrip gasification trends; the result is a somewhat stagnant marketplace. In addition, the high gas meter replacement period, thought to be around 22 years in EMEA, limits the turnover of metering stock.