Grid Market to Double within Five Years

Tuesday, 22 December 2009 10:14

The move toward smart energy is opening the door to new strategic partnerships between traditional utilities and cutting edge IT companies, established and start-ups.

According to a report by Zpryme the smart grid industry in the United States – currently valued a little over $21 million – is expected to increase to $42.8 billion by 2014. Similarly, the report notes that the world market is expected to grow by a greater percentage, from $69 billion this year to $171 billion by 2014. The report tacitly underscores the importance, and potential return, of the stimulus programs supporting smart grid projects and commends the U.S. Department of Energy’s input.

The hope among smart energy proponents is that the more profitable smart energy proves to be, the more willing third world and emerging markets will be to embrace clean energy practices and solutions.

The industries poised to benefit the most are smart meter manufacturers and distributors such as Itron and Landis+Gyr, which are contracted to supply millions of smart meters, and software developers whose programs are used to organize and collect the data collected by meters.

Indicative of smart energy’s growing appeal, Ontario Power Authority has received over a thousand small-scale renewable energy project applications with a cumulative generation potential of more than 8,000 megawatts – 5500 megawatts more than the provincial target.

“We’ve had an outstanding response,” says chief executive Colin Andersen, who noted that an additional 1,500 megawatts would be available after more transmission capacity is built.

The OPA also reported receiving over 1,000 residential projects from homeowners interested in installing roof-top photovoltaic (PV) panels.

PV systems employ solar electric panels to directly convert sunlight into utility-grade electricity for direct use in the home. If the PV electricity exceeds the home’s requirements, the excess electricity can be routed to the utility which is usually required to buy it back.

Ontario’s feed-in-tariff program, initiated three years ago, is credited for attracting thousands of renewable energy investors, a strategy that has also proven effective in Europe to stimulate renewable power resources. With a stated goal to phase out coal use by 2014, Ontario increased the guaranteed rates for wind to 13.5 cents a kilowatt hour and solar PV to 80.2 cents.

According to Green Inc. a growing number of American states are establishing feed-in tariffs, including California, Florida, Vermont and Washington.