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January 15, 2013

China Gets Serious About Smart Meters



The installed base of smart meters in China will reach 377 million by 2020, up from 139 million in 2012, according to a report just released by Boulder, Colorado-based Pike Research (News - Alert). The penetration rate for smart meters will hit 74 percent in the same year.

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“China's smart grid development is on a fast track," commented Pike Senior Research Analyst Andy Bae. "The State Grid Corporation of China (SGCC), the government-owned electric utility that leads the market by a large margin, is the main force behind efforts to construct the country's smart grid. Moreover, building a smart grid is a key goal for many provinces and cities under the country's current Five-Year Plan, which continues through 2015."

China’s smart grid development includes six key areas: power generation, transmission, transformation, distribution, consumption, and dispatching The report, “Smart Grid in China” predicts that the greatest smart grid expansion in China will occur in transmission system upgrades, with transmission investment, reaching a cumulative total of more than $72 billion by 2020. The Chinese government and SGCC have emphasized their intention to invest in high-voltage direct current and transmission upgrades in order to solve the country's power imbalance issues. China aims to provide electricity to urban and rural areas by delivering generated power sources from developable hydropower located in the mountainous southwestern region, as well as wind and solar resources concentrated in the northwest.

Specifically, China’s plans include:

  • Power Generation–Advanced power plant control, monitoring, diagnosis, and optimal operations;
  • Power Transmission–Full implementation of transmission line condition-based maintenance and lifecycle management, and extensive use of flexible alternating current (AC) transmission technology;
  • Power Transformation–Advanced application of interactive technologies, network operation data collection, and comprehensive real-time sharing to support real-time network control;
  • Power Distribution–The use of integrated, interactive, and self-healing capabilities to improve distribution functionality, including acceptance of renewable energy capacity and microgrid technology;
  • Power Consumption–The promotion of smart appliances, smart electricity cell centers, electric vehicles (EVs), and other technologies to increase energy efficiency among end-users; and
  • Power Dispatching –Solutions for safe, reliable, and intelligent dispatching systems.

Pike Research forecasts that annual overall smart grid revenue in China will experience steady growth across the forecast period, with a 2011-2020 compound annual growth rate (CAGR) of nine percent. On a cumulative basis, smart grid revenue in China generated by investments in transmission, substation, and distribution upgrades (as well as smart meters) will increase from approximately $7 billion in 2011 to $127 billion in 2020.

The report includes a detailed analysis of the market drivers, business models and technology issues for smart grid development in China. Profiles are provided for more than 40 key industry players, classified by different industries, along with forecasts for smart grid revenue and smart meter shipments through 2020.

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Edited by Brooke Neuman
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