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Distribution Automation Apps That Will Share Network Space

In 2007, a Newton-Evans survey of electric utilities in North America showed that 65% of the sample planned to have capacitor bank control on the same telecommunications infrastructure as distribution automation. Thirty-eight percent said that Volt/Var optimization, demand management or voltage reduction applications will share the same telecoms as DA, and 13% indicated load balancing will also use the same infrastructure. One quarter of the respondents to this survey cited “other” applications such as AMI, fault location, and station alarms.  We are revisiting this question and obtaining status and plans related to many more DA topics and issues during the fourth quarter of 2014.

DAsharedApps

In designing a Distribution Automation system, controls and/or logic can be control center based, substation based, or field based. The 2007 Newton-Evans survey asked electric utilities, “Which type of controls are you planning for feeder automation?”

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Since completion of the 2007 study, Newton-Evans has conducted several proprietary studies on DA topics, both from a field equipment perspective as well as from a DMS perspective.  Our current study is now being readied for North American-wide utility participation in a comprehensive survey format.    During mid-2014, Newton-Evans also published its series of nine comprehensive DA market segment overviews on key market components including DA/DMS systems, control devices for reclosers and capacitors, voltage regulators, fault current indicators, pole-top RTUs, line mount monitoring devices, DA communications options and DA engineering and consulting services.

For more information on Newton-Evans DA research (including the new study of the North American market for DA, planned for late January 2015 availability) see our reports page and the article below.

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Newton-Evans Research Company plans to revisit the topic of Distribution Automation

DA Brochure Image

Newton-Evans Research Company plans to revisit the topic of Distribution Automation (DA) by researching the market for DA field devices, communications methods, engineering service and Distribution Management Systems (DMS) applications software used in the control center, the substation, and on lines and poles. We will invite hundreds of North American electric transmission & distribution utilities to participate in a survey of Distribution Automation hardware, software and communications infrastructure.

The results of this survey will be combined with Newton-Evans’ discussions with DA vendors and manufacturers and published in a report titled “Distribution Automation 2015-2020: North American Utility Perspectives, Market Outlook and Analysis.” This report – available in January of 2015 – will be a comprehensive market overview of the automation aspects of electric distribution networks and supporting infrastructure. The scope of this research project will also include estimates of growth in the communications infrastructure needed to support this increased deployment of DA hardware and software.

Research Methodology
The study will include several weeks of survey-based research with major and mid-size utilities, requesting their insights regarding DA plans through 2020. This study will also include secondary research to learn about documented plans for DA among North American utilities.

The final report, “Distribution Automation 2015-2020: North American Utility Perspectives, Market Outlook and Analysis” will measure current market sizes, provide estimates and outlooks of demand for distribution automation equipment through 2020, and showcase a selection of major product vendors and service providers in the DA marketplace.

(Download a .pdf brochure here)

Continue reading Newton-Evans Research Company plans to revisit the topic of Distribution Automation

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2014 Autumn Electric Power Conference Season Well Underway

For the electric power industry, late summer through mid-autumn brings a number of conferences to the forefront each year or at least every two years.

This year is no exception. From the international CIGRE Conference held in Paris every two years, to the annual EMMOS conference and Southeast Distribution Apparatus Conference, there are lessons to be learned and topics of interest to those following industry trends. The CIGRE conference provides information on key electric power topics, while EMMOS focuses on large control systems used by utilities and independent systems operators (ISOs). The SDAC offers briefings and training on a variety of power distribution topics, ranging from meter management to control systems to cyber security.

CigreLogo
In late August I attended and participated in my 10th CIGRE conference. This year set a new record for attendance (more than 3,000 delegates and another 5,000 visitors) and the number of exhibitors and working group sessions also reached new heights. One of the more interesting observations for me has been to witness the growth in CIGRE participation by utilities and T&D equipment and systems companies from North America. Delegates are either actively volunteering on working groups or doing booth duty for an increasing presence of large-to-small North American companies whose equipment, systems and services are part of the exhibition.

Continue reading 2014 Autumn Electric Power Conference Season Well Underway

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Ethernet in the Substation

Excerpts from this 2014 Newton-Evans study of the world market for substation automation show some interesting trends regarding the use of Ethernet networks in substations around North America. Some of these trends include:

  1. Electric utilities in North America are showing increased interest in IEEE 1613 as a requirement for Ethernet switches and routers
  2. Single network without failover is the most frequently used Ethernet LAN architecture, and one of the most planned for Ethernet LAN architectures in substations for year end 2016 (along with “Single network with multiple paths/failover” and “Independent primary devices/network and backup devices/network.”
  3. Roughly half of utilities surveyed do not have redundancy in substation Ethernet networks.

Although this year’s sample reported a much different (lower) average number of ports than had been reported in the 2011 sample, Newton-Evans believe that there will be additional Ethernet ports installed in many North American substations by 2016.

By year end 2013, the majority of North American utilities surveyed reported that their Ethernet ports are secured. This is about the same as what was reported in 2011.

By year-end 2013 the lack of redundancy in Ethernet networks had fallen from 55% to 49%, while 35% reported use of Ring approaches and 18% used STAR approaches to provide redundancy in their Ethernet networks as shown in this chart. There were some differences in Ethernet redundancy based on type and/or size groupings. For example, among public power utilities in the sample, 48% said they use Ring topology for redundancy and only 26% claimed they do not have redundancy in their substation Ethernet.

The new study found predominant use of Rapid Spanning Tree protocol (78%) to provide redundancy in Ethernet networks. This is a significant increase over the 57% of survey respondents reporting such use in the previous study. Use of Hot Standby Router protocol (IEC 62439) was reported by 14% of the subgroup, while 10% were using Parallel Redundancy (also IEC 62439) at year-end 2013.

For more information or to order a copy of “The Worldwide Market for Substation Automation and Integration programs in Electric Utilities: 2014-2016” visit our reports page.

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What to Expect Next: Potential Synergies of the Alstom (Power and Grid) Acquisition by General Electric

As many long-term readers of Newton-Evans’ reports and articles knew from our assessment reported in 2009 there were back then three major contenders for the $7 billion Transmission and Distribution business units of the old Areva T&D Corporation. These were the American firm General Electric, the French corporate combination of Alstom and Schneider Electric, and the Japanese company, Toshiba. In the end the French government simply divided Areva T&D in half, and placed the “T” business into Alstom and the “D” business into Schneider Electric.

On June 21, 2014 GE was informed that Alstom’s board of directors decided to recommend GE’s offer to acquire the Power and Grid business of Alstom Corporation. These units are: Alstom Power (generation assets) and more importantly for this assessment, Alstom Grid, the HV and control systems components of the old Areva T&D business. The “D” business of Areva has now become a core business within the capable Schneider Electric camp of medium voltage equipment offerings.

Newton-Evans Research believes significant benefits to GE’s efforts targeting the global electric power industry will accrue if the company staffs truly work synergistically. Here are six key reasons for this view, in our opinion:

(1) IMPROVED WORLD MARKET ACCESS: GE will gain improved access to European electric power markets and other world regions with long-established relationships nurtured by Alstom and predecessors under the French management and government policies, which may continue under GE ownership, now that the French government is slated to become a significant shareholder investor in Alstom securities. Keep in mind that GE has more than a century of experience and accomplishments in France. I can recall visits to Belfort in eastern France and visiting both GE and Alstom (Areva) factory sites.

(2) ATTAINMENT OF ORGANIC GROWTH: GE Energy Management will again be able to lay claim to some real growth within 24 months of the close of this acquisition. Growth will come from both inorganic sources (via this acquisition – itself worth more than $4 Billion in current year sales of Alstom Grid products, systems and services) and organic growth (through increased interest in, and procurement of all combined GE-Alstom equipment, products and services). Each of the four component businesses of GE Energy Management including: Digital Energy, Industrial Solutions, Power Conversion and Energy Consulting will each benefit significantly if all goes as planned and envisioned in early July 2014. The big issue we see is whether Atlanta and Toronto will report in to Paris, or whether the reverse will be true.

(3) REDUCTION IN OFFERINGS “GAP”: GE will be able to fill several significant product/equipment gaps in its electric power transmission and distribution product line and related automation offerings. This will result in significant mid-term benefits to GE Digital Energy. However, a key issue for GE will be the “branding” of product offerings going forward from midyear 2015.

(4) MARKET-LEADING POSITION IN POWER GENERATION: Alstom’s power business includes assets for power generation such as turbines for coal, gas and nuclear power plants, wind farms while GE is a co-leader in both fossil, nuclear, hydro and renewables businesses.

(5) INCREASED SHARES OF OPERATIONAL CONTROL SYSTEMS: While GE’s EMS offerings have had somewhat limited success beyond North America, it’s DMS, OMS and GIS offerings are well-respected and are high quality offerings. Alstom Grid is a world leader in EMS, with a world-class group of systems for power transmission and distribution. The company’s “e-terra” line of systems is the leading market shareholder among critical T&D operational control systems used in the global electric power industry. The company also has developed a growing customer base among large utilities for advanced distribution network management with its IDMS offering. If the companies’ technical and product marketing teams work together as they have over time on various technical committees (IEEE, IEC, CIGRE et al) and provide smooth cross-systems integration capabilities, the company will be a force to be reckoned with in the world market for control systems. GE has a strong substation modernization/automation business focus across all components (systems, products, intelligent devices, communications equipment) that leads the North American market and is a growing force internationally.

GE Energy Management will likely become a major player in several growing portions of the transmission equipment business, establishing a stronger foothold in the North American and international transmission market segments described below. Together these segments are worth $32-40 billion on a worldwide basis. Newton-Evans’ estimates that Alstom Grid earned about $3.5 billion to $4.1 billion in HV equipment sales in 2013.

Here is our take on the gains to be realized for both electric power infrastructure and electric utility automation and services:

FACTS and Reactive Power Compensation:
ABB is probably the global leader in flexible AC transmission systems and the related reactive power compensation segment of high voltage equipment for transmission networks. Siemens Energy is a strong number two supplier with several others (notably Mitsubishi Electric Power Products, and American Superconductor) also active in North America, and around the world. Alstom Grid and GE are also participants that together could challenge the market leading positions of ABB and Siemens within three years of a merger of product lines.

HVDC Equipment:
Siemens is the market leader in HVDC, with ABB a reasonably close second place share holder and MEPPI the likely third most important player. However, an integrated Alstom Grid-General Electric product grouping would enable the company to attain up to a quarter of the available market shares.

Gas Insulated Substations/Switchgear:
The North American market for High Voltage GIS equipment is in excess of a quarter billion dollars. While Alstom Grid has only a small share (stronger in Canada than in the US), GE Energy could now present itself as a player in this growing market segment of high voltage switchgear. GE would also play a much more important role in international markets where – unlike in North America – GIS equipment is prevalent. Globally, GIS equipment is a 2-3 billion dollar annual market.

High Voltage Bushings:
This relatively small (about $125-150M in annual worldwide sales) market is led by Siemens and ABB. However, the combined Alstom Grid and GE offerings could make GE into a formidable player in this segment.

High Voltage Capacitors:
GE Energy is already the major participant in the North American market for HV capacitors, but globally, ABB is the leader. Alstom Grid, by virtue of its recent acquisition of the Finnish manufacturer, Nokian Capacitors, is also a very strong player in Northern Europe. Together, the product lines could pose a real threat to ABB dominance here (yet another billion dollar global product segment).

High Voltage Circuit Breakers:
Alstom Grid is already a major player globally, and with GE’s “sales boots on the ground” could significantly increase its share in North America and abroad. ABB and Siemens are both very strong manufacturers in this large annual global market of better than $2 billion.

Disconnect Switches:
High voltage disconnect switches are vital components of many transmission systems, and the global market runs to about $500 million annually. GE and Alstom Grid are among the six leading suppliers of disconnect switches in North America, but lag behind Hubbell, S&C and Southern States, some of which offer circuit switchers used for disconnect applications.

Large Power Transformers:
Alstom Grid is number three in the world in terms of large power transformer market share and assets, operating 13 plants with an annual production capacity of more than 130 MVA. GE Prolec is a major North American market force with about a 14% share of the U.S. market. Together, this alliance may become number three in the global market for LPTs behind ABB and Siemens). To do so, the GE-Alstom combine will have to fend off HICO, Hyundai, Toshiba and MEPPI as well as three up-and-coming Chinese manufacturers.

Instrument Transformers:
The market for high voltage instrument transformers had been dominated by specialist “independent” manufacturers until recently. A recent buying spree had Siemens acquiring Trench Electric, Alstom Grid acquiring Ritz and ABB acquiring Kuhlman. Currently, the market for HV IT equipment is shared primarily by these three firms, with GE very active in the MV segment. Together, the combined HV/MV instrument transformer offerings of an integrated GE-Alstom Grid would change the shape of this market, which in North America alone hovers around $100 million, and close to one-half billion dollars worldwide.

Air Core Reactors:
Another component of some transmission network architectures, Siemens-Trench and Alstom Grid-Ritz are key players, with GE also strong and MEPPI further behind, but with a growing share. A number of smaller participants account for a rather large share of this $400 million global business.

Surge Arresters:
Another sizable market in its own right (about $1 billion per year globally) high voltage surge arresters are manufactured by a number of US-based firms such as Hubbell, Thomas & Betts, and Cooper Power, each of which competes quite successfully against the likes of ABB, Siemens and GE.

Automation Systems:
GE’s older XA/21 EMS platform and Alstom Grid’s highly rated E-Terra offerings are both held in high regard around the world, although GE’s systems are mainly installed in the USA. By year-end 2015 and more likely into 2016, General Electric-Alstom Grid will see benefits from world-leading combined market shares in substation automation, protection and control and T&D control systems (energy management, DMS, OMS, GIS and SCADA). Earlier (1990’s era) acquisition efforts have been fraught with initial business unit integration problems (to wit- ABB with its acquisition of the older Ferranti EMS business (Spider v. Ranger offerings) and Siemens-Control Data (Sinault-Spectrum v. Empros).

Substation Modernization:
If protective relays are included in the mix of substation modernization, then the collaborative efforts of GE and Alstom will lead to a global co-leadership market position across the board. Alstom Grid enjoys a strong position with transmission class relays and related MiCOM systems and equipment, and has been fairly strong participant in the global market for substation automation. GE enjoys a strong position in protective relays in North America (number two supplier) and in some Western European and Asian markets, and does make the list of qualified suppliers elsewhere.

Protection and Control:
Internationally, Alstom Grid (with part of the Stafford, UK-based relay business) holds an estimated 16% share of the global protective relay market (outside of the U.S.), estimated by Newton-Evans to be about $2.4-$2.6 billion this year. GE Multilin, based in Toronto, is also a very strong market participant, especially in the Americas, and is the leader in industrial protection and control markets.

T&D Services:
GE is a major participant in T&D equipment repair and services, especially with its transformer repair business, and Alstom Grid outside of North America earns about $550 million per year with its array of high voltage equipment services and global agreements for automation systems maintenance and upgrades.
Let’s not count this as a “done deal” quite yet. I do believe it is now very likely to be seen through by all parties (GE, Alstom, French government, possibly various international courts). The important role of Alstom’s minority shareholders and their reaction to the GE acquisition is somewhat unclear as is the role the French government’s strong minority ownership position will play. GE has made significant concessions regarding job retention among the French workforce, and has promised to add another 1000 jobs in the country. This could have ripple effects on its global workforce, especially if workforce reductions take place.

The following chart (used with permission of General Electric) illustrates the current state of the acquisition and the alliance formation.

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U.S. Sales of Distribution Automation Components, Including Equipment, Systems and Services, Estimated at more than $700 Million in 2013, Forecast to Increase to $950 Million by 2016

Newton-Evans Research Publishes New Edition of Nine Market Snapshot Reports on Distribution Automation Topics Covering the Electric Power Industry in the United States.

June 4, 2014. Ellicott City, Maryland. The Newton-Evans Research Company has announced its latest publication of a set of 9 U.S. distribution automation market two-page summaries. The new series of market overview reports (executive market summaries) includes supplier listings, representative products, and estimated market size for each topic, vendor market share estimates and market outlook through 2016. Electric utilities accounted for about 91% of all purchases of distribution automation related goods and services. A majority of distribution automation equipment purchased by American utilities and industrial firms is produced or assembled in the United States.

The Distribution Automation series ($975.00) includes U.S. 2013 market size, market share estimates and 2014-2016 market outlook for these product and service categories:
DA01 – Automatic Circuit Recloser Controls
DA02 – DA/DMS System Components (including distribution network analysis; distribution network condition monitoring and fault location and characterization)
DA03 – Voltage Regulators
DA04 – Capacitor Bank Controllers
DA05 – Fault Indicators (covering both fault current indicators and faulted circuit indicators)
DA06 – Pole Top RTUs
DA07 – Line Mounted Monitoring Devices
DA08 – Communications Components for DA (covering PLC/DLC; cellular and 900Mhz)
DA09 – Engineering Services for Distribution Automation Projects (covering consulting engineering services, related services provided by manufacturers; DA services provided by smart grid consulting specialists).

Other topical series currently available include: the 2014-2016 series on medium voltage equipment (18 market overviews).

Additional series to be released during June-August 2014 cover high voltage equipment (16 market segment overviews), T&D control systems (11 market segment overviews), substation automation (13 market segment snapshots), power transformers (11 market segment snapshots), and protective relays (8 market segment snapshots).

Further information on this new series of U.S. T&D market snapshots is available from Newton-Evans Research Company, 10176 Baltimore National Pike, Suite 204, Ellicott City, Maryland 21042. Phone: 410-465-7316 or visit www.newton-evans.com/our-reports for a brochure or to order any of the related report series or more than 85 planned individual report summaries online. For those interested in subscriptions to multiple report series, please call or email us for special introductory pricing offers. For more information send an inquiry to info@newton-evans.com

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U.S. Sales of Medium Voltage Equipment, Components and Related Services Accounted for More than $11 Billion in 2013, Forecast to Reach $13 Billion by 2016.

May 19, 2014. Ellicott City, Maryland. The Newton-Evans Research Company has announced the publication of a series of 18 electric power distribution market two-page snapshot market summaries. The new series of market overview reports (executive market summaries) includes supplier listings, representative products, and estimated market size for each topic, vendor market share estimates and market outlook and growth factors through 2016. Electric utilities accounted for nearly two-thirds of purchases of the medium voltage product categories in this series, with industrial and commercial segments accounting for about one third of the value of MV equipment shipments. A majority of the included equipment and products continue to be manufactured and/or assembled in the United States.

The Medium Voltage equipment market overview series is priced at $1,500 for all 18 market summary reports, or at $150.00 for individual report summaries. Each snapshot report include product definitions, estimates of 2013 U.S. market size, supplier market shares and the outlook through 2016 for these categories: MV01 – Air Insulated Metal Clad Switchgear; MV02 – MV Motor Controllers; MV03 – MV Gas Insulated Switchgear; MV04 – Automatic Circuit Reclosers; MV05 – Outdoor Distribution Circuit Breakers (5-38kv); MV06 – Load Interrupter Switchgear; MV07 – Overhead Disconnect Switches (15-38kv); MV08 – Sectionalizers; MV09 – Fused Cutouts; MV10 – Pad Mounted Switchgear; MV11 – Submersible Switchgear; MV12 – Bus Duct and Bus Bar ; MV13 – Substation Class Pad Mounted Capacitors; MV14 – Current/Instrument Transformers; MV15 – Fault Current Limiters; MV16 – Fault Current Indicators and Faulted Circuit Indicators; MV17 – Current Limiting Fuses and Fuse Links; and MV18 – Surge Arresters.

Other U.S. T&D market snapshot series to be updated during the next three months include power transformers (11 market segment snapshots), protective relays (8 market segment snapshots) and substation automation components (13 market segment snapshots). The next market overview series to be released covers 12 component topics related to distribution automation. The DA series is planned for publication in June, 2014.
Further information on each series of U.S. T&D market snapshots is available from Newton-Evans Research Company, 10176 Baltimore National Pike, Suite 204, Ellicott City, Maryland 21042. Phone: 410-465-7316 or visit www.newton-evans.com for a brochure or to place an order for any of the related report series or more than 85 individual T&D report summaries online. For subscriptions to all of the currently available report series, please call or email us for special introductory pricing offers. For more information send an inquiry to info@newton-evans.com

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More Estimates on The U.S. Market for Distrubution Automation

From 2008 onward, Newton-Evans Research Company has completed one or two client-based, proprietary studies each year to provide mid-term and longer-term outlooks for one or more components of the burgeoning Distribution Automation market comprised of U.S.-based electric power utilities. The primary focus of these studies has centered on various DA field equipment types and associated controllers as well as DA software and platforms, located in the field, at the substation level or at the MV operations control center.

Research Methodology
These studies have included several weeks of primary research based on direct communications with major and mid-size utilities, requesting their insights regarding DA plans through 2020. These studies also included secondary research methods to learn about documented plans for DA among other North American utilities and to better understand the likely impact of economic growth projections and electric utility revenue outlook and CAPEX spending. Overall economic information used in the preparation of our range estimates was also based on NGO and a variety of government outlook documents.

The following observations are based on survey completions provided by scores of electric power utility officials during 2012-2014.

DA expenditure allocation among three purchasing categories
The overall indications from the surveys completed prior to 2014 pointed to somewhat more than one-half of the 2013-2015 DA budgets going to the procurement of field equipment, with an equal percentage of the remaining budget allocated for platforms and software, and for DA controller devices.

Over the longer term horizon (2016-2020) the DA expenditure outlook indicated a slight shift in spending patterns, suggesting increases in the percentage of program funding allocated to DA field equipment, and slightly lower percentages going toward platforms, software, and DA controller devices.

The following series of charts represent the Newton-Evans consensus view of low, mid-range and high estimates of likely DA spending for five components:

  • DA smart field-based distribution equipment
  • DA controllers
  • substation-based DA platforms and software
  • control center-based DA platforms and software
  • Telecoms for DA

US_DistAutoEquip_Invest-2020

US_DistAutoControllers_Invest-2020

US_DistAutoSSPlatforms_Invest-2020

US_DistAutoCCPlatforms_Invest-2020

US_DistAutoTelecoms_Invest-2020

Specific DA communications network developments are excluded from this outlook. The mid-range outlook is based in large part on the utility survey responses and a cautiously optimistic assessment of the near-term and mid-term.

The low range outlook takes into account the possible continuation of unclear energy policies at the federal and state levels, federal and local government budget woes, minimal growth in electric utility industry revenues and a continuation of relatively flat electricity consumption patterns.

The high range outlook factors in a stronger economic outlook for the periods from late 2013 thorough 2016, based on the economic analysis information reported by several external organizations.

References were made to recent publications provided by several organizations including The Conference Board, Moody’s Analytics, The World Bank, The Federal Reserve and the Bureau of Economic Analysis.

The historic DA spending baseline years in this study have been derived from the larger and more comprehensive mid-2010 study of North American utilities conducted by Newton-Evans Research Company.

The forthcoming update to the report series, “Overview of the 2014-2016 U.S. Transmission and Distribution Equipment Market: Distribution Automation Series” goes into more detail with respect to the market for specific DA equipment and spending categories such as Automatic Circuit Recloser Controls; DA/DMS System Components; Voltage Regulators; Capacitor Bank Controllers; Fault Indicators; Pole Top (and Pad Mount) RTUs; Line Mounted Monitoring Devices; Communications Components for DA; and Engineering Services for DA.

See our reports page for topic listings and pricing details, and be sure to send us an email at info@newton-evans.com or call 1 800 222 2856 to place your order.

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Transmission and Distribution Equipment and Systems: Facts and Figures

Newton-Evans Research Company has completed hundreds of studies encompassing most aspects of the U.S. transmission and distribution equipment and related information management, monitoring and control systems markets in the nearly 36 years of its existence.

During the second quarter of 2014, the company will again be publishing more than 85 T&D segment management summaries which provide top-level overviews of most major components of T&D spending. These management summaries provide information on infrastructure topics as well as automation and control systems and engineering services. Definitions, Market size, market shares, recent year shipment estimates and the 2014-2016 outlook is provided in each summary. While some of the information provided in these reports is based on secondary research, much has been developed from meetings and discussions held directly with equipment manufacturers and systems integrators. In some instances, the supporting data is based on larger studies completed by Newton-Evans.

When coupled with the very large “third party services” market and operational communications network investments, T&D-related spending in the United States has grown to more than $25 Billion as of 2013. Importantly, much of these expenditures would occur naturally, without being classified as “smart grid” related. With a mature electrical infrastructure in place for decades, much of the procurement of T&D goods and services today centers on refurbishment and upgrades of existing facilities and field assets, and the smartening up of an older generation of “passive” equipment.

Spending for high voltage equipment itself accounts for more than $5 billion (excluding power transformers). HV substation upgrades, together with circuit breakers and switchgear, make up the bulk of HV-related spending. Gas insulated HV switchgear will likely grow in importance in the U.S. just as it has in countries around the world. Transmission monitoring and control is now being upgraded with the development and deployment of two relatively new technologies, synchrophasors and dynamic line rating systems. HV substation and transmission line/tower construction spending tends to vary each year and ranges from about $2.5 billion to more than $5 billion in recent years.

TDMktplaceMay2014

Shipments of medium voltage (MV) equipment are now approaching $4.5 billion in value. Major MV equipment categories include air-insulated metal-clad switchgear, reclosers and sectionalizers, load interrupters and surge arrestors. When coupled with spending for distribution automation, and a host of related services and control systems, MV-related spending exceeds $10 billion.

Looking at transformers, which can range from extra-large power transformers to medium power units, to a variety of pad-mount and pole-top distribution units, the value of product shipments for this entire category approaches $5 billion to about $6 billion in a “typical” year.

The emerging field of advanced distribution automation includes the monitoring and control systems supporting field instrumentation devices such as pole-top RTUs, faulted circuit indicators and controllers for capacitor banks and reclosers and voltage regulators. Supporting platforms required for processing data acquired from these devices include newer applications hosted locally, at substations or at the control center-based distribution management systems, which often includes modern “distribution SCADA” systems for mid-size utilities.

Operational control systems have been a mainstay of the electric power delivery industry since the early 1970s. Today, modern energy management systems are in operation in virtually every North American transmission utility. Distribution-focused SCADA systems are now installed and operating at nearly 1,900 U.S. utilities. Separate DMS hosting platforms supporting advanced DA activities are becoming prevalent in many of the largest utilities. When coupled with spending for geographic information systems, outage management systems, meter data management systems, mobile workforce management systems, market management systems, cyber-security applications software and supporting services, the annual external spending for supporting operational IT systems of the U.S. electric utility community is now approaching $2.5 billion.

Combining the very large market for systems protection in the form of protective relays, the market for smart/intelligent electronic devices (various types of substation meters, power quality monitors and event recorders) and the market for integration and processing of all of this data, the recent year aggregated market for HV and MV substation automation and modernization has hovered between $1.5 billion and $2 billion.

Realizing that the investor-owned community of electric utilities accounts for around 70% of all customers, industry revenues and spending on T&D, keep in mind that the 1,800 public power utilities and the more than 900 electrical cooperatives represent an attractive, growing (and often leading edge) user base for newer technologies, especially for MV equipment, systems and services.

In addition to the electric utility community, the 710,000 industrial companies and nearly 18 million commercial firms account for about 15% of all T&D equipment and services purchased in this huge $22-$25 billion marketplace.

Unlike many countries around the world, and unlike many other components of the American economy, U.S.-based factories produce more than 90% of all T&D equipment purchased by U.S. utilities. A few years ago this was not the case for large power transformers, but with the opening of several manufacturing facilities in the southern U.S., this has changed for the better, and has resulted in shortened lead times for power transformers. North American-based business operations also develop and provide the vast majority of services, systems and applications software needed for utility operations and implement virtually all control and monitoring systems used here.

In multiple recent studies conducted by Newton-Evans, the nation’s electrical equipment manufacturers have reported that they have the capabilities to produce whatever may be required to advance the development of a more resilient, more reliable power grid. Smaller firms continue to lead in research and development of advanced energy technologies, and the follow-on benefits of the 2009-2012 ARRA programs under the guidance of the U.S. Department of Energy continue to positively impact the development of a 21st century electric grid.

It will take sustained investment over the next 20-30 years, along with ongoing research and development, to realize a fully reliant, resilient and sustainable power grid here and elsewhere. The development of demand response techniques, inclusion of distributed energy resources, deployment of micro—grids, large scale energy storage, cost-effective underground distribution networks where sensible, and the integration of renewables are each poised to play an important role in the future development of a modern American grid. We don’t need to tear down and start over, but we do need to modernize and upgrade the grid components in an iterative and intelligent manner. We need to improve and safeguard what remains as one of the world’s great technical achievements of the past century, the North American electric power grid.

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Here We Go Again: Potential Synergies of an Alstom (Power and Grid) Acquisition by General Electric:

As many long-term readers of Newton-Evans’ reports and articles knew from our assessment reported in 2009 there were then three major contenders for the $7 billion Transmission and Distribution business units of the old Areva T&D Corporation. These were the American firm General Electric, the French corporate combination of Alstom and Schneider Electric, and the Japanese company, Toshiba. In the end the French government simply divided Areva T&D in half, and placed the “T” business into Alstom and the “D” business into Schneider Electric.

This past week, there have been widely circulated rumors of another attempt by GE to acquire Alstom’s power business, principally Alstom Power (generation assets) and Alstom Grid, the HV component of the old Areva T&D business. The “D” business of Areva is now squarely in the capable Schneider Electric camp of medium voltage equipment offerings.

Newton-Evans Research believes there could be significant benefits to GE’s efforts targeting the global electric power industry if the company’s current purported acquisition attempts bear fruit. There are four key reasons for this view, in our opinion:

(1) As reported by others, GE will gain improved access to European and other world regions with long-established relationships nurtured under the French management and policies, which are likely to continue under GE ownership.

(2) GE Energy Management will again be able to lay claim to some real growth within 24 months. These increases will come from both inorganic growth (via this potential acquisition – itself worth about $4.5 Billion in current year sales of Alstom Grid products, systems and services) and organic growth (through increased interest and procurement of all GE Energy Management equipment, products and services). The four component businesses of GE Energy Management include: Digital Energy, Industrial Solutions, Power Conversion and Energy Consulting. These will each benefit significantly.

(3) GE will be able to fill several significant product/equipment gaps in its electric power transmission and distribution product line and related automation offerings. This will result in significant mid-term benefits to GE Digital Energy.

(4) Alstom’s power business includes assets for power generation such as turbines for coal, gas and nuclear power plants, and wind farms.  Alstom Grid  offers a world-class group of control systems for power transmission and distribution as well as many leading transmission-class equipment offerings. The company’s “e-terra” line of systems is the leading market shareholder among critical systems used in the global electric power industry.

A successful acquisition by General Electric would provide the firm with world-leading combined market shares in substation automation, protection and control and T&D control systems (energy management and SCADA). GE Energy Management would become a major player in several growing portions of the transmission equipment business, establishing a stronger foothold in the North American and international transmission market segments described below. Together these segments are worth $32-40 billion on a worldwide basis. Newton-Evans’ estimates that Alstom Grid earned about $3.5 billion to $4.1 billion in HV equipment sales in 2013.

FACTS and Reactive Power Compensation: ABB is probably the global leader in flexible AC transmission systems and the related reactive power compensation segment of high voltage equipment for transmission networks. Siemens Energy is a strong number two supplier with several others (notably Mitsubishi Electric Power Products, and American Superconductor) also active in North America, and around the world. Alstom Grid and GE are also participants that together could challenge the market leading positions of ABB and Siemens within three years of a merger of product lines.

HVDC Equipment: Siemens is the market leader in HVDC, with ABB a reasonably close second place share holder and MEPPI the likely third most important player. However, an integrated Alstom Grid-General Electric product grouping would enable the company to attain up to a quarter of the available market shares.

Gas Insulated Substations/Switchgear: The North American market for High Voltage GIS equipment is in excess of a quarter billion dollars. While Alstom Grid has only a small share (stronger in Canada than in the US), GE Energy could now present itself as a player in this growing market segment of high voltage switchgear. GE would also play a much more important role in international markets where – unlike in North America – GIS equipment is prevalent. Globally, GIS equipment is a 2-3 billion dollar annual market.

High Voltage Bushings: This relatively small (about $125-150M in annual worldwide sales) market is led by Siemens and ABB. However, the combined Alstom Grid and GE offerings could make GE into a formidable player in this segment.

High Voltage Capacitors: GE Energy is already the major participant in the North American market for HV capacitors, but globally, ABB is the leader. Alstom Grid, by virtue of its recent acquisition of the Finnish manufacturer, Nokian Capacitors, is also a very strong player in Northern Europe. Together, the product lines could pose a real threat to ABB dominance here (yet another billion dollar global product segment).

High Voltage Circuit Breakers: Alstom Grid is already a major player globally, and with GE’s “sales boots on the ground” could significantly increase its share in North America and abroad. ABB and Siemens are both very strong manufacturers in this large annual global market of better than $2 billion.

Disconnect Switches: High voltage disconnect switches are vital components of many transmission systems, and the global market runs to about $500 million annually. GE and Alstom Grid are among the six leading suppliers of disconnect switches in North America, but lag behind Hubbell, S&C and Southern States, some of which offer circuit switchers used for disconnect applications.

Instrument Transformers: The market for high voltage instrument transformers had been dominated by specialist “independent” manufacturers until recently. A recent buying spree had Siemens acquiring Trench Electric, Alstom Grid acquiring Ritz and ABB acquiring Kuhlman. Currently, the market for HV IT equipment is shared primarily by these three firms, with GE very active in the MV segment. Together, the combined HV/MV instrument transformer offerings of an integrated GE-Alstom Grid would change the shape of this market, which in North America alone hovers around $100 million, and close to one-half billion dollars worldwide.

Air Core Reactors: Another component of some transmission network architectures, Siemens-Trench and Alstom Grid-Ritz are key players, with GE also strong and MEPPI further behind, but with a growing share. A number of smaller participants account for a rather large share of this $400 million global business.

Surge Arresters: Another sizable market in its own right (about $1 billion per year globally) high voltage surge arresters are manufactured by a number of US-based firms such as Hubbell, Thomas & Betts, and Cooper Power, each of which competes quite successfully against the likes of ABB, Siemens and GE.

Automation Systems: GE’s long-established XA/21 EMS platform and Alstom Grid’s highly rated E-Terra offerings are both held in high regard, although GE’s systems are mainly installed in the USA. Earlier (1990’s era) acquisition efforts have been fraught with initial business unit integration problems (to wit- ABB with its acquisition of the older Ferranti EMS business (Spider v. Ranger offerings) and Siemens-Control Data (Sinault-Spectrum v. Empros).

Protection and Control: Internationally, Alstom Grid (with part of the Stafford, UK-based relay business) holds an estimated 16% share of the global protective relay market, estimated by Newton-Evans to be about $2.2-$2.4 billion on an annual basis. GE Multilin, based in Toronto, is also a very strong market participant, especially in the Americas, and is the leader in industrial protection and control markets.

T&D Services: GE is a major participant in T&D equipment repair and services, especially with its transformer repair business, and Alstom Grid outside of North America earns about $550 million per year with its array of high voltage equipment services and automation systems maintenance agreements.

We will soon see learn whether and how the French government will allow Alstom to sell off all but its transportation business to a “foreign” company. GE will likely have to make significant concessions regarding job retention among the French workforce. This could have ripple effects on its global workforce.

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Electric Utility SCADA/DMS and OMS Convergence Trends

Here are some more excerpts from our latest study of the World Market Study of SCADA, Energy Management Systems, Distribution Management Systems and Outage Management Systems in Electric Utilities: 2013-2015. The information below was collected from 101 electric utilities in the U.S. and Canada between the 4th quarter of 2012 and 1st quarter 2013. The survey sample consisted of Investor Owned utilities (21%), Public Power (35%), Cooperatives (44%), and Canadian Utilities (13%).

Has your utility converged SCADA/DMS and OMS functions?
A total of 35% of utility respondents either had already converged SCADA/DMS and OMS or planned to do so by the end of 2015. Only 6% of Public Power utilities surveyed had already converged these functions, but another 21% had plans in place to do this by 2015.

Has your utility converged SCADA/DMS and OMS functions? (as of Jan. 2013)
SCADA-OMS_convergence

What functions have been converged/or plan to be converged?
Eighteen respondents said they had either converged SCADA and OMS, or planned to. Some mentioned that their SCADA reported all operations and statuses of monitored devices to their OMS, and some indicated that SCADA and OMS were less tightly integrated (for example, in some cases SCADA might only report switch/breaker status to OMS.) Here are a few of the more specific comments that were mentioned on the survey:

  • AMI system will provide customer meters out to the OMS system on a limited basis.
  • All distribution SCADA functions have been integrated with OMS/DMS through interface applications.
  • SCADA reports all operations/statuses of monitored devices to OMS
  • One way interface from SCADA to OMS (breaker & switch status)
  • Integrated platforms – smart meter “last gasp” info feeding GIS & SCADA systems which then feeds Outage Notification system
  • Topology (coloring feeder); Load Flow; Real Time Metering; Volt-VAR Control; Outage Report
  • SCADA/DMS. SCADA provides the load data to operate the DMS.
  • Multispeak connections between SCADA and OMS
  • Predicted and actual outages
  • Telvent’s ADMS product (OMS&DMS) to be installed on top of upgraded Telvent OASyS DNA SCADA system.
  • Estimated restoration times, extent of outage, number of customers

Does your utility currently have real-time linkages between SCADA and GIS or OMS?
Sixty percent of utilities surveyed did not have any real-time linkages in place as of January, 2013. About one-third had real-time linkages in place between SCADA and OMS, while just 15% had real-time linkages between SCADA and GIS.

Larger Investor Owned utilities were more likely to have real-time communications linkages in these situations. Just over half of Investor Owned utilities (52%) had real-time linkages between SCADA and OMS, and 24% had real-time linkages between SCADA and GIS. Fifty-four percent of large utilities (i.e. serving more than 1 million customers) had real-time linkages between SCADA and OMS.

Does your utility currently have real-time linkages between SCADA and GIS or OMS? (as of Jan. 2013)
real-time_linkage

More details about the topics covered in this and other studies are available on our reports page.

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Interest in Combining Control Systems on a Common Platform Among North American Electric Utilities

The following is excerpted from the Newton-Evans Research study, “World Market Study of SCADA, Energy Management Systems, Distribution Management Systems and Outage Management Systems in Electric Utilities: 2013-2015.” Read more about it on our reports page here.

Do you have any interest in combining EMS and DMS on a common platform?
In 2013, utility interest in combining these two systems was observed to be about the same as it was in 2010. A total of 26% of respondents had interest or had already combined their EMS and DMS systems. In 2010, 27% of utilities surveyed expressed an interest in doing this. Cooperatives showed less interest in combining, while Investor Owned utilities had more interest.


(Summary from the 2012 survey)

In the 2010 survey, there was some interest in combining EMS and DMS on a single platform; 27% of respondents answered “yes” they had an interest in combining the two. There was more interest among Canadian respondents (36%), IOUs and public power utilities (each at 32%), compared with only 13% of cooperatives (this sub-group of distribution cooperatives is less likely to use EMS technologies). Similarly, larger utilities were somewhat more interested in this combination of EMS and DMS than were smaller utilities.

Do you have any interest in combining DMS and OMS on a common platform?
Similar to what had been reported in the 2010 study, the 2013 study indicated that 41% of utilities either have interest in combining DMS and OMS (36%), or have already combined them (5%).

Do you have any interest in combining DMS and OMS on a common platform?
(Summary from the 2012 survey)

Overall, 40% of the 92 utilities responding to this part of question 3 expressed interest in a combined DMS/OMS platform. The highest level of interest was noted among Canadian respondents (64%); the lowest amount of interest was among U.S. cooperatives (17%). Fifty percent of utilities serving more than one million customers were interested in combining DMS and OMS capabilities on a single platform. Questions 3a and 3b are new questions added to the 2010 survey.

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U.S. Market for Feeder Protection Relays

According to GE Digital Energy, a feeder protection relay can provide primary circuit protection on distribution networks and backup/auxiliary protection for transformers, generators and motors. With a total estimated market of about $60 million in direct sales to the nation’s electric utilities, this total is expected to grow to $72 million by the end of 2014. Modern (digital/numeric) feeder relays are a key segment of the overall substation modernization and distribution automation equipment market. Feeder relays are just one of 84 types of electric T&D equipment and services discussed in the Newton-Evans report series, Overview of the U.S. Transmission and Distribution Equipment Market, which is presently being updated to reflect year-end 2013 U.S. market values and provide market forecasts and outlook through year-end 2016.  This summary of feeder relay activity is typical of the information contained in each of the 84 reports.  Market segment shares for suppliers are also provided in each report.  Here are a few of Newton-Evans’ observations on this important market segment taken from the 2011 market overview series as well as the Worldwide Study of the Protective Relay Marketplace In Electric Utilities: 2012-2014.

Average Unit Price Range:
Distribution feeder relays have been recently priced between $900 and $1,800 depending on whether or not other features like over-current protection are included.

Major Manufacturers:
ABB: REF615R Feeder Protection and Control, REF series
Basler: BE1-11f system
Beckwith: M7651
Cooper (now owned by Eaton): iDP210
Eaton: CH-Series, E-Series
GE: M Family, SR 3 350, F650
SEL: 751, 751a, 351S
ZIV: IRV, DRV
ERLPhase: F-Pro

Findings from the Worldwide Study of the Protective Relay Marketplace In Electric Utilities: 2012-2014 Volume 1 – North American Market:
The 2012 survey findings suggested a likely increase in purchase plans for transmission line relays and distribution feeder relays. In 2012, as in previous studies, distribution feeder relays made up the largest portion of planned relay purchases over the 2012-2014 time frame. A significant share of all utility relay purchases (units) planned for this period were distribution feeder relays.

The earlier 2009 study findings had indicated that distribution feeder relays were the “best-selling” and most widely used type of protective relay within the utility segment, even though redundancy in the distribution grid was not nearly as common as found in transmission applications. About 40% of the total number of units planned for purchase during the forecast period was to be distribution feeder relays.

Digital vs. Electromechanical
In 2012 the survey respondents indicated that 60% of distribution feeder relays in their installed base  were digital/microprocessor relays. This percentage continues to grow as more digital relays are added to the current system every year. The earlier 2009 study observed that 53% of the installed base was digital, with 97% of planned unit purchases likely to be digital as well.  As recently as 1999, the split was 50-50 (electro-mechanical versus digital/numeric).

To stay up to date on our progress with the Overview of the 2014-2016 U.S. Transmission and Distribution Equipment Market, sign up for our newsletter by emailing with the subject line “subscribe.” Visit our reports page for more information and to download a report brochure.

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U.S. Electric Transmission & Distribution Equipment Market Overview

In 2014 Newton-Evans plans to update its U.S. T&D Equipment Market Overview report series to reflect market observations from 2013 and estimates for 2014-2016. This series of 2-3 page “top line” summaries will present the 2013 market shares for major participants in dollars and % of U.S. total. Each report will also present U.S. market segmentation in $MUSD, and a forecast out to 2016. Vendor and IEEE equipment definitions are provided.

Make sure to email info@newton-evans.com and sign up for our newsletter and report availability notifications for this series.

Here is a complete list of reports that will be available for $150 each:

Continue reading U.S. Electric Transmission & Distribution Equipment Market Overview

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Smart Meter Deployments By Usage Segment

Even in mid-2013, American utilities continued to rely on more than 80+ million “dumb” electricity metering devices for data acquisition on electricity consumption. Most of the installed analog metering devices were manufactured in the United States. Smart metering technology is also largely developed and manufactured in the U.S.; at the very least, it is tested in the U.S., and its final assembly is completed here. There are several more suppliers of automated meters than there were of electromechanical meters. Here is Newton-Evans outlook for smart meter deployments in each of three key usage segments.

Smart Meter Deployments Timeline

Smart Meter deployments chart

For more information about U.S. electric utility equipment manufacturing capabilities see our recent report, “American Manufacturing and Systems Integration Capabilities for Power Grid Modernization” on our reports page.

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Encryption of Substation Communication Protocols On The Rise in North American Electric Utilities

The recent Newton-Evans survey of the Worldwide Market for Substation Automation and Integration programs in Electric Utilities: 2014-2016 reveals the increasing trend in North America of encrypting substation communication protocols. Here are a few facts about this topic:

1) Out of 59 North American electric utilities responding to the survey question, “What protocols do you use within the substation, between substations, and from the substation to the external host or network?” forty-five said they currently use DNP3 (serial) and 28 said they use DNP3 LAN (TCP or UDP) within the substation. For communication from substation to substation, 16 said they use SEL protocols and 21 said they use a version of DNP3. For communication from substations to the external host or network most respondents use a version of DNP3.

2) When asked the follow up question, “Are these protocols encrypted?” sixty-nine percent (41/59) said “No.” This seems like a lot, but the Newton-Evans survey has found that every few years more and more North American utilities are using encryption.

Are substation communication protocols encrypted?
SSA_enr_protocolsNA

3) Utilities were then asked, “If your protocols are encrypted, where do you employ encryption?” a) Inside the substation b) substation to substation c) substation to master (choose all that apply). Of the 15 North American utilities responding to this question, 14 indicated they encrypt protocols from substation to master, while only 3 use encryption within the substation and 2 from substation to substation.

Purchase the full report from our reports page for more detailed information on substation protocol use, encryption, and substation communications.

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Excerpts from Volume 2 of The World Market for Substation Automation and Integration Programs in Electric Utilities: 2014-2016

The Newton-Evans Research Company has released findings from the International volume (Volume 2) of its newly published four volume research series entitled: The World Market for Substation Automation and Integration Programs in Electric Utilities: 2014-2016. In addition to looking at plans for over 20 types of equipment commonly used in substation-wide automation and integration programs, this 200+page report includes a comprehensive look at the market trends for:

  • choice of communication protocols within and between substations, and from substation to control center
  • wireless devices inside the substation
  • number of Ethernet ports in a substation
  • number of simultaneous wireless connections allowed
  • protocol encryption and redundancy
  • communications architectures and links
  • Time Synchronization methods
  • protective relays
  • outsourcing of substation-related services

Key findings from 5 other recently Newton-Evans studies on substation-related topics accompanies the information gathered in late 2013 from thirty-two global electric power utilities that participated in the latest five-page survey.  A total of 96 unique utilities located in 57 countries around the world participated in one or more sections of the substation modernization study. On average, these international utility officials participated in two or three of the six topical surveys that form this report.

 

Some observations:
Potential obstacles to implementing substation automation and integration for both new and retrofit substations through year-end 2016
Similar to 2011, very few utilities ranked any of the listed “potential obstacles” as a 5. Of all the listed challenged, the two that least stand in the way are “Lack of appropriate communications technology inside the fence” and “Lack of appropriate communications technology substation to master.” Over 60% of respondents ranked these a 1 (“doesn’t stand in our way.”)

For new substations, “security concerns” was rated a 4 by 4 out of 31 respondents, as were “Not enough skilled internal staff” and “Substation equipment vendor community will not have required “open” products and equipment by year end 2016.”

Choice of protocol within the substation, between substations, and from the substation to the external host or network.
Within the substation, international utility respondents cited use of IEC 61850 as well as the variants for IEC 60870-5. Followed by Modbus (serial, LAN and Plus) versions. For the minority of utilities performing any peer-to-peer substations communications, IEC 60870-5 -101 and -104, led in mentions. These were closely followed by SEL mirrored bits, and by DNP 3, Growth in use of IEC 61850 for peer-to-peer communications is planned by this group. IEC 60870 variants were also the most widely used protocols for substation-to-control center communications internationally. Some DNP, common legacy protocols were also being used for substation-to-control center communications.

Additional information on the International substation market report, and the other three reports comprising the four volume study “Worldwide Market for Substation Automation and Integration Programs in Electric Utilities:2014-2016” is available from Newton-Evans Research Company, 10176 Baltimore National Pike, Suite 204, Ellicott City, Maryland 21042.
Phone 1-410-465-7316, write to info@newton-evans.com and see our reports page for more details.

An introductory price of only $1,495.00 for Volume Two is available to new subscribers until March 8, 2014.

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Excerpts from Volume 1 of The World Market for Substation Automation and Integration Programs in Electric Utilities: 2014-2016

The summaries in the Report Findings section of this report provide top-level views and synopsis of all 77 North American utility respondents combined. In the Data Tables section of the report, survey results are cross-tabulated by size and type of responding utility.

The Newton-Evans 2014 sample for this study represents a total of at least 32,594,000 end-use customers, 2,019 transmission substations and 7,649 distribution substations in the United States and Canada. The sample distribution of North American utilities in this study is similar to previous year studies. About one-fifth of the responding utilities are U.S. Investor-owned, 36% are public power utilities, 32% are cooperatives and 12% of the respondents in the sample are Canadian provincials and municipals.

1. Please rank the significance from 1 to 5 for all of the following listed “potential obstacles” to implementing substation automation and integration for both new and retrofit substations through year-end 2016. Use: “1 = doesn’t stand in our way” to “5 = formidable obstacle.”
Just as in 2011, utilities seem to be least concerned with “lack of appropriate communications technology inside the fence.” For new substations, 69% of respondents said this “doesn’t stand in our way,” and for retrofitted substations, 48% said the same. “Lack of funding” for retrofitted substations seemed to be a potential obstacle, with 51% rating it a 3 or higher. This was also the chief obstacle in 2011, although “security concerns” was rated a 4 or higher by 33% of the same group. The current survey shows only 20%-24% of utilities in the sample rating “security concerns” a 4 or higher.

SSAvol1-non-obstacles

SSAvol1-obstacles

More information on how to order volume 1 or other volumes of this report series is available on our reports page.

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Newton-Evans Releases First Volume of 2014-2016 Substation Automation Series

The Newton-Evans Research Company has released findings from the North American volume (Volume 1) of its newly published four volume research series entitled: The World Market for Substation Automation and Integration Programs in Electric Utilities: 2014-2016. The new study compares the current round of research findings with several earlier substation modernization tracking studies conducted by the firm. More than 75 large and mid-size North American electric power utilities actively participated in this multi-part study. Investor-owned utilities, public power utilities, cooperatives and Canadian provincials and municipals took part in this complex study involved more than 400 survey data items.

Newton-Evans Research estimates the current mid-range of North American spending for substation automation and integration programs at $690 million, with an overall potential market size of nearly $10 billion. Global potential spending for substation modernization programs is estimated at about $38-$40 billion. This amount includes spending for a wide range of intelligent substation-resident equipment and devices and the manpower to undertake the systems integration efforts required.

Additional Observations:
1) The years 2008-2009 were slow growth years – while the 2010-2013 years provided moderate-to-good growth in most categories of intelligent electronic equipment sales related to the modern, increasingly digital, electric power substation. The pool of funding for substation automation projects increased during 2010-2013 thanks in part to the stimulus funds made available by the U.S. Department of Energy, with most of this amount now spent.

2) Newton-Evans further estimates that only about 12-15% of utility operated substations in North America have been fully automated and integrated by year end 2013. Most of these fully automated installations are in fact being reported as newly or recently constructed transmission voltage substations.

3) It is becoming more difficult to separate substation product classifications as equipment manufacturers tout their offerings as “multifunctional” and the product positioning of many intelligent electronic devices now cuts across multiple product classifications.

4) Most substation equipment manufacturers (mid size and smaller companies) and systems integrators surveyed in the second half of 2013 have indicated moderate-to-good growth market conditions within their addressable utility market segments, resulting in sales that are as much as 10-20% higher than 2010-2012 sales levels. The substation automation market outlook for 2014 is also for moderate to good year-on-year growth, continuing through 2016. Looking ahead to 2014-2016, substation retrofit programs are planned to be undertaken only for the most critical of distribution substations, while new electric power T&D substations will benefit from increased spending for integration and automation.

5) The outlook for increased reliance on commercial services providers working in substation modernization activities is strongly positive. Third party engineering and integration service firms have recently made significant strides in winning substation automation-related business, from planning to design to construction and equipment installation.

6) Utility manpower shortages and funding issues continue to negatively impact the ability of technology supplier companies to engage utilities for other than short-term automation requirements. In states and provinces wherein regulators have approved strong incentives for reliability improvements or for transmission line extensions, the spending outlook is robust.

7) North American utilities continue to strongly support DNP 3, and many have now implemented, or are migrating to, a LAN version of this protocol. This year’s study has found some increase in plans for use of at least some portions of 61850 within a few dozen of North America’s largest utilities. The use of encryption techniques for transmission of substation data is also growing.

8) In summary, retrofit substations will be upgraded as warranted during 2014-2016, based on regional load growth, load criticality to customers, and related distributed generation and renewables siting developments. New substations will increasingly be designed and constructed as integrated and automated remote assets for the utility. The current study finds the bulk of available substation automation budgets likely to be spent for new substations, primarily for transmission substations.

Additional topics being covered in the four volume series of substation automation studies include in-depth coverage of several communications topics, vendor security certification requirements, external systems linkages to the substation, preferred equipment suppliers, substation timing requirements, and an assessment of how North America’s electric power substations are positioned along a three-step path to complete automation.

This newest edition of this flagship Newton-Evans study features excerpts from other recent substation research programs, including precision timing requirements; CAPEX/OPEX outlook; dynamic line rating systems and synchrophasor-related monitoring systems; the expanding role of relay-centric devices and imbedded sensors; and user-reported vendor preferences for 21 specific substation-resident equipment categories.

Additional information on the North American substation market report, and the other three reports comprising the four volume study “Worldwide Market for Substation Automation and Integration Programs in Electric Utilities:2014-2016” is available from Newton-Evans Research Company, 10176 Baltimore National Pike, Suite 204, Ellicott City, Maryland 21042.
Phone 1-410-465-7316, write to info@newton-evans.com and see our reports page for more details.

An introductory price of only $1,495.00 for Volume One is available to new subscribers.

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Market Trends Digest

A special December 2013 edition of the Newton-Evans Research Company’s Market Trends Digest is now available on our website. This edition looks at some of the studies Newton-Evans has put together in 2013. Also, see some preliminary results from our study of the World Market for Substation Automation & Integration 2014-2016, and read two articles by our CEO Chuck Newton:

1. ASAT and Alstom Grid: One Year Post-Merger
2. Cyber-security: Still Time to Heed the Warning Signals