[Smart Grid Market Research] Smart Grid Index: November 2012 - Zpryme Smart Grid Insights

SMART GRID INSIGHTS
NOVEMBER 2012

SMARTGRIDRESEARCH.ORG
INTELLIGENT RESEARCH FOR AN INTELLIGENT MARKETTM

SMART GRID INDEX

INTELLIGENCE BY ZPRYME | ZPRYME.COM
© 2012 ZPRYME RESEARCH & CONSULTING, LLC. ALL RIGHTS RESERVED. SGI: NOVEMBER

Table of Contents

Executive Summary ................................................................. 2

Methodology .......................................................................... 2

Smart Grid Sentiment............................................................... 3

Expected Utility Expenditures over the Next 12 Months....... 4

Sales/Expenditures over the Last 12 Months ......................... 5

Sales/Expenditures over the Next 12 Months........................ 6

Expected Staff/Jobs over the Next 12 Months ...................... 7

New Deals Closed Last Month ................................................ 8

Expected Proposals Submitted over the Next 12 Months .... 9

Hurricane Sandy: Smart Grid Impact on Outages ............. 10

Respondent Industry Representation ................................... 11

About The Smart Grid Index ................................................. 11

1 [SGI] ZPRYME SMART GRID INSIGHTS Smart Grid Index| November 2012

Copyright © 2012 Zpryme Research & Consulting, LLC All rights reserved. www.zpryme.com | www.smartgridresearch.org | www.fiercesmartgrid.com

Executive Summary November 2012 Smart Grid Index Results

The first month’s results of the Smart Grid Index (SGI) show
that Smart Grid industry executives have a very positive Overall Sentiment
71% currently have a positive view of the Smart
view of future opportunities for Smart Grid technologies.1 Grid.
Utilities were less pessimistic than those in the total sample
both for total expenditures and the hiring of new
personnel. Almost half of the vendors surveyed closed a Expected Utility Investments
new deal last month, while 75% of utilities expect to submit 31% expect utility Smart Grid related investments
new Smart Grid proposals for budget approval over the to significantly increase over the next 12 months.
next 12 months. Additionally, 79% of respondents believed
that Smart Grid technologies could have helped restore Current Sales/Expenditures
power faster after Hurricane Sandy hit the Northeast U.S. 60% said their Smart Grid related sales or
expenditures have increased over the last 12
Methodology months.

This study was conducted by Zpryme and FierceSmartGrid Expected Sales/Expenditures
by surveying 240 smart grid executives from November 1st 71% expect their Smart Grid related sales or
to November 7th of 2012. The survey was conducted expenditures to increase over the next 12
online. Please note that percentages may not add up to months.
100 due to rounding. Three groups were used to inspect for
differences: vendors (70% of sample), utilities (10% of Hiring
sample), and total sample. The data are presented in 56% expect the number of staff in Smart Grid
related roles to increase over the next 12
figures 1 through 9 in this report. months.

December’s Survey
Deals Closed
45% of vendor respondents said they closed
December’s survey will be fielded from December 3rd to new Smart Grid related deals last month.
December 10th of 2012. The results will be released on
December 13th. Utilities and Smart Grid vendors are
encouraged to participate. If you would like to take the New Proposals
monthly survey please send an email to sgi@zpryme.com. 75% of utility respondents plan to submit new
Smart Grid proposals for budget approval over
the next 12 months.
1 The SGI is developed by Zpryme’s Smart Grid Insights and FierceSmartGrid.



Smart Grid Sentiment

Seventy-one percent of the total sample were positive about the global Smart Grid industry, with vendors more positive
(78%) than utilities (60%). However, only small percentages across all three groups were negative (ranging 6% to 10%).

What is your current view of the global Smart Grid industry?

100%

90% 21% 16%
30%
80% 6%
7%
70%
10% Neutral
60%
Negative
50%

40% Positive
78%
71%
30% 60%
20%

10%

0%
All Respondents Utilities Vendors
(figure 1, source: Zpryme/FierceSmartGrid November 2012 Smart Grid Index Survey)



Expected Utility Investments/Expenditures over the Next 12 Months

Compared to utilities, vendors are more optimistic about global utility expenditures on Smart Grid technologies as 33% of
vendors said they expect investments to increase significantly over the next 12 months (vs. 25% for utilities). However, almost
half of all respondents, utilities, and vendors, expect utility expenditures to increase at least a little over the next 12 months.

Over the next 12 months, global utility investments or
expenditures on Smart Grid Technologies are expected to:
100%
6% 5%
90% 15%
12% Decrease
14% significantly
80% 10%
70% Decrease a
little
60%
49%
46% Stay the same
50% 50%
40% Increase a little
30%

20% Increase
31% 33% significantly
10% 25%

0%



Sales/Expenditures over the Last 12 Months

Over the past 12 months, the majority of all three groups had increased their Smart Grid sales and/or expenditures. The total
sample and vendors reported small decreases (both at only 6%), while utilities reported no decrease in Smart Grid related
expenditures.

Over the past 12 months, my company's Smart Grid
related sales and/or investments (or expenditures) have:
100%
6% 6%
90%

80% 39% 29%
34%
Decreased
70%

60%
Stayed the
50% same

40% Increased
30% 60% 61% 65%

20%

10%

0%



Sales/Expenditures over the Next 12 Months

Over the next 12 months, most respondents in all three groups expect Smart Grid sales and/or expenditures to increase, with
utilities being more conservative (68% increase) than the total sample (71%) or vendors (74%).

Over the next 12 months, my company's Smart Grid
related sales and/or investments (or expenditures) are expected to:
100%
6% 5%
11%
90%
23% 21%
80% 21%
70% Decrease

60%

50% Stay the same

40%
71% 74%
68% Increase
30%

20%

10%

0%



Expected Staff/Jobs over the Next 12 Months

Over the next 12 months, most respondents expect hiring to increase. However, a few of the total sample (8%) and vendors
(7%) project a decrease in hiring. Utilities, on the other hand, do not expect hiring to decrease.

Over the next 12 months, the number of
staff/jobs in Smart Grid related roles are expected to:
100%
8% 7%
90%

80%
37% 33%
53%
70%
Decrease
60%

50%
Stay the same
40%

30%
56% 60% Increase
47%
20%

10%

0%



New Deals Closed Last Month

Almost half of the vendors (45%) surveyed said that they had closed new deals last month.

Last month, did your company close any new Smart Grid
related deals (sales, partnerships, investments, aquisitions, etc.)?*

Yes, 45%

No, 55%

*Seventy percent of the sample was made up of vendors. Vendor industries are those respondents identified as manufacturers of power products or
systems, technology vendors or integrators, and business, technical, and/or engineering consultants.



Expected Proposals Submitted over the Next 12 Months

An overwhelming majority of utilities (75%) expect to submit new Smart Grid proposals over the next 12 months.

Over the next 12 months, does your utility plan to submit any
new Smart Grid proposals, plans or pilots for budget approval?*

No, 25%

Yes, 75%

*Ten percent of the sample was made up of utilities.



Hurricane Sandy: Smart Grid Technologies Impact on Outage Response Times

Seventy-nine percent of respondents reported that Smart Grid technologies could have helped restore power faster after
Hurricane Sandy hit the Northeast U.S. Utilities were less favorable concerning Smart Grid technology’s benefit. On the other
hand, vendors proved to be significantly more optimistic than utilities about Smart Grid technology’s benefit.

Given the massive damage and power outages caused by the storm (Sandy) that just hit the
Northeast United States, do you think that Smart Grid technologies could have helped utilities
restore power faster had they been fully deployed?

100%

90% 21% 16%

80%
44%
70%
No
60%

50%

84% Yes
40% 79%
30%
56%
20%

10%

0%



Respondent Industry Representation About The Smart Grid Index

Ten percent of respondents were utilities, while 70% were The SGI is developed by Zpryme’s Smart Grid Insights and
vendors. Vendor industries are those respondents FierceSmartGrid. The monthly Smart Grid Index is an
identified as manufacturer of power products or systems, objective and unbiased market indicator that captures
technology vendor or integrators, and business, technical, the real-time industry sentiment, outlook, and
and/or engineering consultants. The remaining 20% were performance.
from the educational, nonprofit, power generation,
government, and other industries. Government data and statistics are usually 1 to 2 years
behind. Additionally, major industry announcements and
Industry Representation of Respondents deals only capture a small fraction of market activity. Such
lack of data can lead to poor investment decision criteria
Education for utilities and technology vendors operating (or seeking
institution, 5% Nonprofit
organization, to enter) in the Smart Grid space. Thus, the goal of the
2% monthly Smart Grid Index is to provide credible, reliable,
Utility, 10% and timely market information for utilities and Smart Grid
Other, Power
5% generation, 5% executives so they can better assess their performance
versus their peers, and decrease the risk associated with
State/federal Smart Grid related investments.
government,
2%
Technology
vendor or
integrator, 27%

Consultant
(business,
technical, or
Manufacturer engineering),
of power 30%
products or
systems, 13%

(figure 9, source: Zpryme/FierceSmartGrid November 2012 Smart Grid
Index Survey)



About Zpryme Smart Grid Insights Practice: Zpyme Credits

Zpryme-powered Smart Grid Insights Publication, Practice and Research Manager Sr. Research Analysts
Advisory Board help organizations understand their business Roger Alford, Ph.D. Megan Dean
environment, engage consumers, inspire innovation, and take action. Paula Smith
Zpryme Smart Grid Insights represents an evolution beyond traditional
market research and consulting: combining sound fundamentals, Disclaimer:
innovative tools and methodologies, industry experience, and These materials and the information contained herein are provided by Zpryme Research & Consulting, LLC and are
intended to provide general information on a particular subject or subjects and is not an exhaustive treatment of
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