Digital Power Utility Market - Size, Industry Share, Growth Trends and Forecasts (2024 - 2031)

By Component:

Based on components, the market is trifurcated into hardware, software, and services.

Trends in the Component:

• The digital utilities, which include maintenance of software, system upgrades, and data security are handled using managed services.
• In order to enhance efficiency and reduce operational risks, virtual twins of the assets are created for predictive maintenance and real-time simulation.

The hardware sector accounted for the largest revenue of 61.50% of the total digital power utility market share in 2023.

• The hardware components in the digital power utility infrastructure include smart meters, sensors, transformers, etc., to ensure seamless collection of consumer data.
• The data collected is then used by utilities and city planners, to perform smart sensing and data analytics for further environmental planning and integrated municipal operations.
• For instance, in February 2023, Hitachi launched its next-generation "TXpert hub". They store and analyze the data gathered from the transformer's digital sensors.
• Therefore, the need for efficient analyses of consumer data drives the hardware sector in the digital power utility market growth.

The software sector is anticipated to register the fastest CAGR during the forecast period.

• The software components are integrated into the hardware component to monitor and optimize power operations.
• The AI-enabled software components significantly improve the efficiency and effectiveness of handling power outages and demand.
• They also make the decision-making processes related to grid operations much easier and well-informed.
• For instance, Schneider Electric's "EcoStruxure™ Grid Engineering Advisor" consists of visual packages, as well as the visual representation of the devices associated with the network. This allows users to make informed and intuitive decisions effectively.
• In conclusion, the increasing focus on energy optimization and data analytics drives the software sector in the digital power utility market trends.

By Application:

Based on application the market is segmented into generation, transmission, distribution, and retail.

Trends in the Application:

• With the increasing focus on energy efficiency and customer-centric approaches, innovations such as microgrids and peer-to-peer energy trading are gaining traction.
• Advancements in customer engagement platforms are leading to the adoption of technologies such as AI-enabled applications, ensuring energy efficiency and systems to monitor the user's energy consumption.

The distribution sector accounted for the largest revenue share of the overall digital power utility market share in 2023.

• The distribution of energy involves the utilization of technologies such as real-time data analytics, automatic switches, etc for seamless delivery to the end-users.
• Moreover, software components such as the advanced distribution management system (ADMS) automate the outage restoration process and grid optimization.
• For instance, Siemens Spectrum Power™ ADMS, integrates renewable sources to create a sustainable energy system, utilizing smart power distribution management.
• Therefore, the surge in the demand for automated distribution systems drives the digital power utility market demand.

The transmission sector is anticipated to register the fastest CAGR during the forecast period.

• In digital utilities, transmission involves the transportation of electricity from the primary plants to the distribution network.
• The high voltage direct current minimizes the overall loss that occurs during the transportation process, especially over long distances.
• For instance, the 525 kV HVDC cable technology was launched by Prysmian Group aiming to achieve an efficient and reliable power transmission process.
• In conclusion, the transmission sector with minimal loss during transportation drives digital power utility market trends.

By End-User:

Based on End-User, the market is segmented into residential, commercial & industrial, utilities, and government.

Trends in the End-User:

• AI-based home energy management systems are increasingly being adopted to reduce electricity usage and hence, the reduction in electricity bills.
• Advanced technologies such as digitalized energy management systems, with the integration of AI-driven forecasting tools are utilized to build smart cities.

The utility sector accounted for the largest revenue share in 2023.

• Due to the several benefits provided by the digitalization of power operations such as reduced operations cost, enhanced grid optimization, etc., utility companies are slowly inclining towards it.
• Real-time monitoring, data gathering, and analyses allow the companies to save on manual labor and utilize these features to enhance operations.
• Moreover, AI-powered forecasting tools let companies take relevant actions towards cost-cutting or increase process efficiency.
• Therefore, the recent innovations involving the digitalization of power utilities drive the sector towards rapid development.

The commercial & industrial sector is anticipated to register the fastest CAGR during the forecast period.

• The commercial & industrial sector is moving towards the optimization of energy consumption and adoption of smart energy solutions.
• The IOT and cloud technologies allow industries to access real-time solutions, reduce waste of energy, and lower operational costs.
• These innovative technologies and devices allow commercial buildings to store energy efficiently and access it when required.
• For instance, the energy storage systems by AceOn Group allow consumers to optimize energy objectives, involving both on and off-grids. It can be used in situations or places where energy availability is scarce.
• In conclusion, the analysis of segmental trends depicts that the requirement for energy efficiency and minimizing cost drives the commercial & industrial sectors in the digital power utility market opportunities.

Regional Analysis:

The regions covered are North America, Europe, Asia Pacific, the Middle East and Africa, and Latin America.

Asia Pacific region was valued at USD 20.00 Billion in 2023. Moreover, it is projected to grow by USD 24.47 Billion in 2024 and reach over USD 115.21 Billion by 2031. Out of this, China accounted for the maximum revenue share of 35.6%.

As per the digital power utility market analysis, the regional growth is driven by the rising focus on renewable energy and the implementation of government policies. Moreover, the adoption of green energy initiatives mostly in countries like India and China, further accelerates the digital power utility market expansion.

• For instance, the adoption of "new-type energy storage systems" (NTESS) is increasingly being emphasized by the Chinese government This includes multiple methods revolving around energy storage, including electrochemical systems, compressed air energy storage, flywheel systems, and supercapacitors.

North America is estimated to reach over USD 174.72 Billion by 2031 from a value of USD 32.28 Billion in 2023 and is projected to grow by USD 39.28 Billion in 2024. The increasing adoption of smart meters, sensors, and grids, surges the digital power utility market expansion in this region. Moreover, the growing investments in energy efficiency and power generation further accelerate the growth.

• According to a report by the U.S. Energy Information Administration (EIA), 119 million advanced (smart) metering infrastructure (AMI) were installed in the utilities.

As per the digital power utility market analysis, the growth in the industrial sector and increasing investments in power operations accelerate the market growth in Europe, creating more opportunities. Moreover, the installation of power grids further contributes to the growth.

The regional trends in the Middle East & Africa and Latin America, expect potential growth in the market, due to the advancements in distributed energy sources integrated with data analytics and artificial intelligence.