Proving the Business Case for the Internet of Things

Smart grids could save smart city citizens $14bn a year

Steve Rogerson
January 16, 2018
Smart grids linked to smart cities will save citizens $14bn a year in energy bills by 2022, according to data from Juniper Research.
This is up from the $3.4bn saving estimated for 2017, resulting from smart meter rollouts, energy-saving policies and sensing technology to improve grid reliability and efficiency.
As part of the study – Smart Cities: Strategies & Forecasts in Energy, Transport & Lighting 2017-2022 –Juniper analysed and ranked global cities to assess their performance and approach towards energy consumption and delivery:

  1. Seoul
  2. San Francisco
  3. New York
  4. Portland, Oregon
  5. Barcelona
"Seoul’s large-scale deployment of electric vehicle charging infrastructure, smart street lighting and smart meter rollouts will undoubtedly accelerate the development of smart grid infrastructure to manage these elements," said research author Steffen Sorrell.
Juniper found that the high cost of carbon capture and storage technology was making fossil fuel investment uneconomical. With the projected cost of renewable energy sources such as wind and solar falling close to $60 per MWh in 2022, it predicted the inevitable investment would force accelerated deployment of smart grids to scale renewable energy reliably.
Furthermore, the research argued that the business case for distributed renewable generation would be strengthened by the application of blockchain. Here, dramatic efficiencies along the value chain could be achieved by simplifying a certification system currently susceptible to accounting errors and increased costs.
Juniper found that with smart city budgets now being discussed and allocated worldwide, policy had become more important than the technology. For instance, it argued that MaaS (mobility as a service) could drastically reduce city congestion by virtue of nearly eliminating the need for private transport.
Nevertheless, it claimed that MaaS would never come to fruition without strict city policy enforcement. For that reason, it predicted that cities in Far East Asia would become true smart cities earlier than their Western counterparts.
China continues to lead the global smart electric meter market with nearly 70 per cent of tracked installations, according to Navigant Research. But trailing regions of North America and western Europe will continue to present smart meter project opportunities as more late adopters come to the table.
“The relatively developed markets of North America and western Europe trail China in installations but will continue to present project opportunities as more late adopters come to the table in response to lower technology costs and proven use cases,” said Michael Kelly, research analyst with Navigant Research. “In addition, a higher frequency of replacement and upgrade projects is expected, and is already beginning to play out in parts of North America, Italy and Sweden. These second-generation projects are likely to affect vendor share and communications share selection analyses, with powerline communications already demonstrating a notable decline.”
In other regions, such as Asia Pacific, Latin America and the Middle East, the market remains fragmented or underdeveloped thanks to deployments in major countries and limited to no activity in others, according to the report. In Africa, the region continues to be inhibited by financial constraints, though more high-level activity is emerging from countries such as Egypt, Nigeria and South Africa.