smart water metering market: global and european perspectives
TRANSCRIPT
Smart Water Metering Market: Global and European Perspectives
European Utility Week – Smart Water 6th November, Amsterdam
By
Fredrick Royan Research Director, Global Environment (Water) Markets
Email: [email protected]
Agenda
2
About Frost & Sullivan and the Global Water Market Practice
Introduction to Global Smart Water Metering Market – Market Engineering Measurements
Market Drivers and Restraints
Market Revenue Forecasts and by Vertical Segment
Market Prospects by Region
European Smart Water Metering Market
Industry Convergence to Fuel Market Growth
Near Term Trends
Market Drivers and Restraints
Market Revenue Forecasts
Regional and Vertical Segment Attractiveness
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3
Frost & Sullivan Research Coverage along the Water Cycle
Desalina)on Plant
Industry Water Needs
On-‐site Household /Community
Wastewater Treatment Plant
On-‐site Industrial wastewater Treatment
Lakes, Rivers and
Groundwater Storage Reservoirs
Drinking Water Treatment Plant Water
Distribu)on Network
Point of Use (PoU) /Point of Entry (PoE)
Domes)c Households, Commercial
and Ins)tu)onal Water Needs Oceans and
Brackish Water
Process Water Treatment
Sewage Treatment Plants
Combined Industrial Wastewater
Treatment Plants
Sludge Treatment Plants
Ballast Water Treatment in the Shipping Industry
Disposal to Oceans and Surface Waters
F&S Water Team Exper/se
Water Abstrac/on and Treatment by end-‐users:
Wastewater Treatment and Disposal:
Wastewater Collec)on Network
Energy from Wastewater
Rainwater Harves)ng Systems
Water Reuse, Recycling & Trading
F&S IPC and Smart Water Grid Exper/se
4
Global Smart Water Metering Market - Market Engineering Measurements
5
Compound Annual Growth Rate
10.5%
(CAGR, 2012-2017)
Market Concentration*
64% (% of market share held by
top 4 companies)
Market Stage
Growth
Market Revenue
$3.15 B
(2012)
Market Units/Volume
8.6 M
(2012)
Average Price Per Unit
$233.8
Market Size for Last Year of Study Period
$5.18 B
(2017)
Base Year Market Growth Rate
11.3%
Customer Price Sensitivity
8
(scale:1 [Low] to 10 [High])
Degree of Technical Change
6
(scale:1 [Low] to 10 [High])
Total Smart Water Metering Market: Global, 2012 Market Overview
For a tabular version click here. Stable Increasing Decreasing
*Market concentration defined as smart water meters, not metering installation and data management. Note: All figures are rounded. The base year is 2012. Source: Frost & Sullivan
6
Source: Frost & Sullivan
Smart water meter
Meter Data Management
Installation
Smart water meter market (value components)
Global Smart Water Metering Market - Coverage and Segmentation
7
Total Smart Water Metering Market: Key Market Drivers and Restraints, Global, 2013–2017
Source: Frost & Sullivan
Varying awareness of technology and vendors
Lack of independent 3rd party verifica)on of benefits and cost analysis
Business case and the return on investment (ROI)
Lack of available capital
1-‐2 Years 3-‐4 Years 5th Year
Non-‐revenue water (NRW): leakage and theS
Increased billing revenue and accuracy
Ensured, sustainable water supply to all customers
Service op)miza)on and network control
Mar
ket D
river
s M
arke
t Res
trai
nts
Impact: High Medium Low
Global Smart Water Metering Market - Market Drivers and Restraints
8
Source: Frost & Sullivan
Business case for smart water
metering proven
Government support through legisla=on
Public acceptance
Lower acceptance due to
fractured market
confusion
Capital barriers and economic health
Drive to reduce
leakage and op=mize system
Ambi)ous
Predicted
Conserva)ve
High Impact
Neutral Impact
Low Impact
Global Smart Water Metering Market - Key Assumptions in the Revenue Forecast
9
Global Smart Water Metering Market - Revenue Forecast
Note: All figures are rounded. The base year is 2012. Source: Frost & Sullivan
Key Takeaway: The market is still primarily fuelled by meter and installation revenues.
2012–2017 Revenue CAGR Conservative = 9.1%
Predicted = 10.5% Ambitious = 11.3%
Total Smart Water Metering Market: Unit Shipment and Revenue Forecast Global, 2010–2017
0
2
4
6
8
10
12
14
16
18
0
1.000
2.000
3.000
4.000
5.000
6.000
2010 2011 2012 2013 2014 2015 2016 2017
Anticipated revenue Conservative revenue Ambitious revenue Anticipated units Conservative units Ambitious units
Rev
enue
($ M
illio
n)
Uni
ts (M
illio
n)
Year
10
Global Smart Water Metering Market - Revenue Forecast by Vertical Segment
Note: All figures are rounded. The base year is 2012. Source: Frost & Sullivan
Key Takeaway: As the market continues to grow, meter sales and installation increase revenues over the forecast period.
0
1.000
2.000
3.000
4.000
5.000
6.000
2010 2011 2012 2013 2014 2015 2016 2017
Rev
enue
($ M
illio
n)
Year
Total Smart Water Metering Market: Revenue Forecast by Vertical Market Global, 2010–2017
Predicted smart water meters ($ million) Prediction installation ($ million)
Prediction meter data management ($ million)
11
Despite the hype, smart water meters have a long way to go to become a mainstream technology by global standards.
0 100 200 300 400 500 600 700 800 900
1.000
2012 2017 2012 2017 2012 2017 2012 2017 2012 2017
North America Europe Asia-Pacific Middle East and Africa
Latin America
Smart meter Basic meter Not metered Off-network
Note: All figures are rounded. The base year is 2012. Source: Frost & Sullivan
Total Smart Water Metering Market: Residential Endpoint Status by Region, Global, 2012 and 2017
Region
Uni
ts (M
illio
n)
Global Smart Water Metering Market - Market Prospect by Region
12
Global Smart Water Metering Market - Competitive Analysis
Tier II
Tier I
Tier III
Tier I – Sensus Metering Systems Inc, Neptune Technology Group Inc., Elster Group SE, Badger Meter
Tier III – Global range of smaller manufacturers
Tier II –Itron, Arad Ltd, Hydrometer GmbH
Percent of Sales, Smart Water Metering Market: Global, 2012
The base year is 2012. Source: Frost & Sullivan
13
Global Smart Water Metering Market - Overview of the European Market
Market Stage
Growth
Market Revenues
$1,218.9 M
(2010)
Market Units/Volume
3.2
M (‘2010)
Average Price Per Unit
$175-215
Market Size at End of Forecast Period
$7,762.8 M
(2020)
Base Year Market Growth Rate
20.8%
Compound Annual Growth Rate
(CAGR)
20.3%
Customer Price Sensitivity
7
(scale:1 [low] to 10 [High])
Market Concentration
55.0%
Degree of Technical Change
4
(scale:1 [low] to 10 [High])
Market Overview Smart Water Metering Market: Market Engineering Measurements (Europe), 2010
Stable Increasing Decreasing
(% of market share held by top 3 companies)
Note: All figures are rounded. The base year is 2010. Source: Frost & Sullivan analysis.
(Price include smart meter, installation and network and
data management)
14
Global Smart Water Metering Market - Key Market Forces of the European Market
Mar
ket D
river
s M
arke
t Res
trai
nts
1-2 years 3-5 years 6-10 years Efficiencies and Savings
Environmental and Social Awareness
Fractured and Confused Market
Regulation and Legislation
Under-developed Business Case
Technology and Innovation
Stranded Assets
Impact: High Medium Low
Smart Water Metering Market: Key Market Drivers and Restraints (Europe), 2011-2020
Service Expansion
Capture Market Growth
Data Security and Public Resistance
Low Commitment to Evolving Market
Source: Frost & Sullivan analysis.
15
Global Smart Water Metering Market - Key Assumptions for Scenarios of the European Market
Benefits are Proven and Widely
Spread Govt.
Support Public
Acceptance
Reduced Confusion in
Data Management
Market
Environmental Challenges Overcome
System More
Affordable
Ambitious
Predicted
Conservative
Nega)ve Neutral Posi)ve
Source: Frost & Sullivan analysis.
16
Global Smart Water Metering Market - Regional Attractiveness in the European Market
Note: Bubble size refers to market size in $ million for 2010
UK Germany
France Italy, Greece & Malta
Iberia
Benelux Alpine
Scandinavia
Ireland
0,0
5,0
10,0
15,0
20,0
25,0
30,0
35,0
0,0% 5,0% 10,0% 15,0% 20,0% 25,0% 30,0% 35,0%
Gro
wth
Rat
e, 2
010-
2020
(%)
Market Share (2010)
Smart Water Metering Market: Regional Attractiveness (Europe), 2010-2020
Note: The base year is 2010. Source: Frost & Sullivan analysis.
17
Global Smart Water Metering Market - Vertical Attractiveness in the European Market
Smart Water Meter Manufacturers,
Meter Installers,
Network & Data Management,
0,0
5,0
10,0
15,0
20,0
25,0
30,0
35,0
40,0
0,0 10,0 20,0 30,0 40,0 50,0 60,0 70,0 80,0
Gro
wth
Rat
e, 2
010-
2020
(%)
Market Share, 2010 (%)
Smart Water Metering Market: Market Attractiveness by Vertical Market (Europe), 2010-2020
Note: Bubble size refers to market size in $ million for 2010. Note: The base year is 2010. Source: Frost & Sullivan analysis.
18
Global Smart Water Metering Market - Penetration in European Market – 50% by 2020 and 90% by 2030
Note: All figures are rounded. The base year is 2010. Source: Frost & Sullivan analysis.
2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2030 Households ('000) 174.253 176.379 181.964 182.629 186.047 189.509 193.013 196.562 200.156 202.254 204.398 206.592 208.837 211.137 214.682
Water Meters ('000) 149.935 152.911 159.488 161.168 165.801 170.557 175.439 180.449 185.591 188.829 192.175 195.633 199.209 202.911 214.682
Smart Water Meters ('000) 6.504 8.030 9.978 13.434 20.253 27.513 35.237 43.446 52.162 63.963 73.489 83.338 93.525 103.881 195.061
0
40.000
80.000
120.000
160.000
200.000
240.000
Uni
ts ('
000)
Smart Water Metering Market: Market Penetration (Europe), 2007-2020 and 2030
Note: Figures are based on expected forecast
19
Global Smart Water Metering Market - External and Internal Challenges of Utilities
Performance targets
Sustainability
Ageing infrastructure
Revenue growth
Budget cuts
Population demographic
change
Legislation
Climate change
Water scarcity
Rising energy costs and
service fees
Water utility
Source: Frost & Sullivan
Innovation is required to achieve necessary operational efficiencies because traditional technologies and infrastructural designs are increasingly unable to address the changes and challenges impacting water services.
Key Takeaway: Data-driven smart technology can help overcome each challenge experienced.
20
Water utility/
operator Smart meter manufacturer
Installation company
Communications and data analytics
Telecoms networks
IT infrastructure and solutions
Design and engineering
1. 2.
3.
4. 5.
6.
7.
3. 4.
4.
3. 4.
Traditional sales direction and product segmentation
New service added by segment vendor highlighting industry convergence; new service number corresponds with separate product segment
3. 6. 4.
6.
Convergence is occurring to such an extent that customers are
becoming competitors.
Source: Frost & Sullivan
Global Smart Water Metering Market - Industrial Convergence to Fuel Growth
21
Global Smart Water Metering Market - Near Term Trends
2 Meter data management is growing around the world, but it presents the greatest potential in North America where water utilities are aligned with the potential future uses of data and analytics. There will be greater potential in Europe as it switches over to AMI technology.
3 Non-exclusive strategic partnerships will be crucial as the market continues to evolve, coping with fragmentation and the various paths water utilities may take to deploy smart water metering programs. There is no appetite to try and dictate market direction through proprietary solutions.
1 While high levels of competition in North America and Europe continue to drive bulk sales of smart water meters, the newest battle for sustained sales growth is in Asia-Pacific, Middle East and LATAM.
Source: Frost & Sullivan