Electrical Business

News
Renewable energy integration a higher priority for smart grid projects


May 31, 2012
By Anthony Capkun

May 31, 2012 – Smart grid technologies are often portrayed as being vital to efforts to increase renewable energy production, yet this aspect of the smart grid is the least developed, says Pike Research. While there are multiple companies currently active in this market, their efforts “have largely been relegated to PowerPoint presentations, pilot programs and long-range planning”.

According to a new report from Pike Research, this situation will change over the next several years, creating a significant expansion of the market opportunity for smart grid technologies that enable the integration of renewables. Revenue from smart grid renewables integration will reach almost $4 billion in 2012, Pike forecasts, and climb to $13 billion by 2018. The sector’s compound annual growth rate (CAGR) over those six years will be nearly 23%.

“The success record of smart grid renewables integration to date is a mixed bag,” says senior analyst Peter Asmus. “European countries are boldly plowing forward while many U.S. utilities exhibit ‘electrotrophobia’—the fear of change linked to greater reliance upon intermittent renewable energy resources. That will change as many utilities launch comprehensive programs and place significant investments in the ability of the smart grid to lower the costs of integrating renewable generation at the transmission, distribution and residential levels.”

The leading technology in terms of smart grid renewables integration market revenue in 2012 is microgrids, which will capture more than $3 billion, or 81% of the total pie. Remote microgrids will represent about 92% of this total, a reflection of the challenges of integrating distributed solar and wind in regions of the world where a reliable utility power grid is lacking. In 2018 microgrids will continue to lead the market, with 77% of total worldwide revenue.

Pike Research’s report, “Smart Grid Renewables Integration”, examines current thinking and practices with regard to a series of smart grid technologies, policies and applications designed to help integrate large penetration levels of renewable energy into power systems around the world. It provides market capacity and revenue forecasts for the following technologies: static VAR compensators; synchrophasors; transmission, distribution and residential advanced energy storage systems; demand response; virtual power plants and microgrids.