The smart meter market is growing massively with heavy investment. Ovum has said this industry will see "massive" growth while Gartner claims though all verticals in EMEA will continue decline in 2010, the utilities and smart meter market will rise.
It predicted that enterprise spending in utilities will reach $46.2 billion in 2010, a 1.9 percent increase from 2009, and is expected to exhibit the highest year-on-year growth through 2014.
Researching the smart meter market, Ovum, which is part of Datamonitor, found that countries are in various stages when it comes to this sector. It listed the UK as looking to accelerate its smart metering roll out as well as citing the country as the most liberalised of Europe’s energy markets. It added that the metering segment was fully liberalised in the UK market.
According to Stuart Ravens, Ovum principal analyst, there are many reasons behind the growth.
"Smart meters became a mandatory technology in the EU with guidelines stating that there should be an 80 percent deployment of these by 2020," he told TechEye.
"However, when the Labour government, was in power it put in plans to include smart meters in 100 percent of gas and electricity utilities by 2020. The coalition government has continued this but accelerated the deployment."
He added that, looking at the technology, industry smart meters are one area that will grow and investments will continue to be made.
"Two years ago everyone was very worried about technology markets but smart meters were one area that they continued to invest in as it's a future need.
"The downturn has accelerated this market because before this it was just slow and steady," he added.
That said, there was still investment in this technology a few years back. According to Mr Ravens 2006-2007 saw some key players in hardware getting interested, including Itron, Landis + Gyr, Sensus and Echelon. Fast forward a few years and Oracle, Cisco, SAP and HP all have smart meter strategies in place.
However, with the good comes the bad and in the smart meter industry the downfall here is what Ovum describes as a "disruptive technology" - in terms of the investment needed by companies to be able to support them and their processes.
"For example you need to upgrade billing systems," said Mr Ravens. "And also there's a lot more data to be stored."
He also said there were many more factors to consider with the new technology: "Consumers currently get one reading a year but smart meters will change this to giving us 48 a day.
"Companies may also begin to look at peak time charging like telcos do for telephones."
Smart grids have been hailed as a way to help to reduce the environmental impact of traditional electricity production by supporting increased volumes of renewable energy and energy storage, with which ageing infrastructure was not designed to cope.
Meanwhile smart meters counter the issue of resource scarcity by influencing customer behaviour through demand-response programmes, which take control of appliances and turn them off when demand peaks. They also help to improve customers’ understanding of their energy usage, how it affects their bill and the environment.
Mr Ravens says customers who have smart readers in place need to be educated on how to maximise energy conservation
"The smart meter attached to someone's wall will help companies and may be a nice novelty for consumers for the first three months but then they will go back to their old habits. "
Although Ofgem has come up with a strategy to try to combat this, through advertising campaigns, similar to the digital switchover, Ovum believes that this will not work as the industry needs a prolonged campaign to effect long-term behavioural changes.
"[Companies] need to get customers to associate electricity use with recycling. For example turning off lights can save carbon," Mr Ravens said.
"They also need to build up relationships with customers as at the moment many do not have good relationships. Consumers need clearer and more flexible tariffs, which take into consideration lifestyles and needs."