IoT in Smart Utility and Energy Market Size (2024 – 2030)

The Global IoT in Smart Utility and Energy Market registered a value of $30.64 Billion in 2023, with a projected increase to $66.92 Billion by 2030. Forecasted for the period spanning 2024 to 2030, the market is expected to exhibit a Compound Annual Growth Rate (CAGR) of 11.8%. The primary driver for the escalating market revenue is the growing demand for reduced energy costs and heightened energy efficiency. Industries are increasingly turning to Building Energy Management Systems (BEMS) in response to concerns over climate change and the surge in oil and gas prices. Furthermore, there is a noticeable integration of the Internet of Things (IoT) into production processes within industries, owing to its enhancement of operational efficiency. Leveraging technologies such as AI/ML and machine-to-machine (M2M) communication has facilitated rapid data transmission and analytics, ultimately leading to improved real-time control and assessment.

Overview of IoT in Smart Utility and Energy Market

The advent of Industry 4.0, inclusive of the Internet of Things, heralds the forthcoming industrial revolution. IoT is conceptualized to offer enhanced solutions and services, boost productivity and efficiency, address critical challenges, and enable better real-time decision-making. Industries are integrating IoT into energy and utility sectors to modernize their operations, aiming to enhance operational effectiveness and automate processes. IoT encompasses a diverse set of techniques enabling devices and objects to interact over networks. This interconnectedness provides rich, real-time data and analytics, simplifying real-time monitoring and control. Consequently, productivity and operational efficiency have increased while process complexities have diminished.

Adoption of IoT in Utility and Energy Sectors

The burgeoning trend of IoT adoption spans across all industries, with the utility and energy sectors investing significantly to elevate their operations and enhance consumer experiences. IoT holds promise in automating intricate processes and offers numerous benefits within the energy and utility sector, including automation of processes, ensuring worker safety, cost reduction, and enhanced output. Moreover, IoT is empowering industries with predictive and prescriptive analytical solutions, integrating advanced techniques like AI and Machine Learning. This integration enables solutions in areas such as asset management, remote servicing, operational intelligence, and predictive maintenance. The increased digitalization in operational processes and industrial control systems, incorporating smart sensors, remote access and control, notably contributes to market growth. However, apprehensions surrounding IoT data security and privacy remain a significant concern that could potentially impede technology adoption.

Impact of COVID-19 on IoT in the Smart Utility and Energy Market

The imposition of lockdowns by governments worldwide resulted in suspended manufacturing operations across numerous hubs, significantly affecting the Industrial IoT industries. Supply chain disruptions led to challenges in raw material procurement, labor shortages, and price escalations due to heightened demand, negatively impacting the industry. Nevertheless, the shift towards remote working policies has spurred a demand for operational transparency. The utilization of IoT and smart connected devices is poised to play a crucial role in offering operational visibility at an organizational level. Many industries are adopting IoT techniques to facilitate remote work and streamline their business operations accordingly. These factors collectively serve as catalysts for the growth of IoT in the utility and energy market during the forecast period.

Market Drivers

The rising demand for asset tracking in the Logistics Industry is a key driver propelling the IoT in the Smart Utility and Energy Market.

Through the integration of software and hardware to capture and automate data within industrial processes, IoT has revolutionized supply chain management. Logistics companies are increasingly employing asset tracking sensors to ensure product integrity and quality, thereby fueling the growth of the IoT market in the smart energy and utility sector. The optimization and automation of delivery, scheduling, and placement processes through IoT in transportation and logistics have significantly enhanced productivity. The increased adoption of SCADA, handheld scanners, barcodes, RFID tags, and other data monitoring and acquisition systems in freight operations, warehousing, and last-mile delivery for real-time visibility on goods movement further augments the market.

The imperative to address Climate Change is driving the adoption of Energy Management Systems, consequently propelling growth in the IoT in smart utility and energy markets.

The anticipated increase in the adoption of energy management systems aligns with stringent requirements to reduce carbon dioxide emissions and fossil fuel usage, particularly in industrial and commercial sectors across various nations. The global demand for energy management systems is further driven by the necessity to decrease electricity generation from nonrenewable resources and overall energy consumption. Substantial investments by leading market participants in energy management systems for rapid innovation and technological advancements are expected to bolster market growth throughout the forecast period.

Market Restraints

Security and Privacy Concerns associated with IoT service implementation pose significant hurdles to market growth.

The ongoing digitalization of processes presents security and privacy challenges, particularly with confidential business data. The escalating number of cyber-attacks, data breaches, and false data injections across various industry verticals are inhibiting widespread IoT adoption. However, considerable investments in cybersecurity measures are poised to mitigate this challenge, fostering healthy market growth in the latter stages of the forecast period spanning 2024 to 2030.

IoT IN SMART UTILITY AND ENERGY MARKET- BY COMPONENTS

• Platform
• Solutions
• Services

Segmentation of the IoT within the Smart Utility and Energy Market by components includes Platforms, Solutions, and Services. The market was dominated by the solution segment in 2021 and is anticipated to maintain steady growth with a robust CAGR over the forecast period. Solutions leveraging IoT technology play a pivotal role in integrating various business operations within the utility and energy sector, thus propelling industry growth. Integration of technology with existing processes, requiring minimal infrastructure investment, is expected to enhance operational efficiency across firms. Application areas such as energy generation & transmission, infrastructure and asset management, workforce management, security, energy management, consumer side analysis, and remote surveillance and monitoring showcase the versatile utility of IoT technology within the energy and utility sector. By facilitating analytics-based decision-making, IoT solutions mitigate market risks and vulnerabilities, contributing to improved operational performance within the energy industry. Moreover, remote monitoring and control capabilities provided by IoT technologies enhance asset performance, minimize service outages, ensure consistent customer experiences, and optimize overall organizational efficiency.

IoT IN SMART UTILITY AND ENERGY MARKET- BY SOLUTION

• Asset Monitoring Management
• Safety & Security
• Supervisory Control and Data Acquisition (SCADA)
• Connected Logistics
• Energy Management
• Mobile Workforce Management
• Others

Categorization of the IoT within the Smart Utility and Energy Market by Solutions encompasses Asset Monitoring Management, Safety & Security, Supervisory Control and Data Acquisition (SCADA), Connected Logistics, Energy Management, Mobile Workforce Management, and other segments. Notably, the Energy Management and Connected Logistics categories significantly contributed to market growth. In 2021, the energy management market valuation stood at USD 19 billion and is forecasted to reach USD 27 billion by 2030. The escalating demand for cost reduction and enhanced energy efficiency propels market revenue growth. Concurrently, increasing environmental concerns and escalating fossil fuel prices drive the adoption of energy-saving solutions, leading to a surge in energy management system utilization. These systems enable real-time control and monitoring of diverse connected systems, ensuring energy-efficient environments within facilities, thereby fostering segment growth.

The connected logistics segment, valued at USD 20.47 billion in 2021, is projected to reach USD 35.6 billion by 2030, exhibiting a CAGR of 10.6% during the forecast period of 2022–2030. Technological advancements, including high-definition mapping, sensor processing technologies, adaptive algorithms, and vehicle-to-vehicle communication, are pivotal in enhancing vehicle tracking, safety management, and predictive maintenance. Automation techniques in smart transportation, prioritizing asset management, alongside the adoption of IoT in vehicles, foster connectivity and monitoring of diverse business activities, ultimately promoting operational efficiency.

IoT IN SMART UTILITY AND ENERGY MARKET- BY SERVICES

• Consulting
• Integration and Deployment
• Support and Maintenance

The segmentation of IoT within the Smart Utility and Energy Market by Services includes Consulting, Integration & Deployment, and Support & Maintenance. Integration & Deployment emerges as a major contributor to market development. Enterprises utilize integration and deployment services to seamlessly connect IoT devices with solutions and integrate them into existing or desired IT infrastructure. By aligning enterprise IT solutions with business imperatives, these services enhance organizational flexibility and operational efficiencies. The primary motivation for businesses to leverage system integration services lies in augmenting overall operational efficiency and quality. These services aim to integrate disparate IT systems within organizations, expediting information flow and reducing operational costs.

IoT IN THE SMART UTILITY AND ENERGY MARKET- BY APPLICATION

• Water and Wastewater Management
• Oil & Gas Management
• Electricity Grid Management
• Coal Mining
• Others

Categorization of IoT services within the Smart Utility and Energy Market by Applications encompasses Water and Wastewater Management, Oil & Gas Management, Electricity Grid Management, Coal Mining, and other sectors. Electricity Grid Management is estimated to hold the largest market share, owing to its pivotal role in ensuring efficient power administration and supply to end consumers. Leveraging network capabilities and computational intelligence in modern grids enhances automation, resulting in smart and automated grid infrastructures. IoT-enabled components like smart sensors, receivers, meters, and energy boxes facilitate real-time data exchange and communication within the grid, enabling swift response to maintenance issues and improving power distribution management. IoT solutions streamline tasks associated with power transmission, outage management, demand response, and equipment maintenance, thereby fostering market growth within the utility sector.

The Oil & Gas Management segment is poised for substantial growth, driven by the imperative for companies to optimize operational efficiency amidst fluctuating oil prices. IoT technologies enable remote monitoring of oil rigs and pipeline integrity, aiding in the prevention of mishaps and ensuring better end-to-end processes within oil and gas plants. These advancements positively influence market growth within the IoT in Smart Utility and Energy Market.

IoT IN SMART UTILITY AND ENERGY MARKET- BY REGION

• North America
• Europe
• The Asia Pacific
• Latin America
• The Middle East and Africa

Regionally, the IoT within the Smart Utility and Energy Market is classified into North America, Europe, Asia Pacific, Latin America, and The Middle East and Africa. North America emerged as the primary contributor to market growth, followed by Europe and the Asia Pacific. Europe is poised for significant growth, driven by governmental initiatives within the region. North America maintains its dominance, with a projected CAGR of 19.56% during the forecast period, owing to substantial investments in smart grid deployment. Moreover, the presence of large investor-owned utility companies and small cooperative and municipal utilities further fuels market expansion within North America.

The Asia Pacific region is witnessing rapid urbanization, increased disposable income, and a digitalization trend, positioning it as one of the fastest-growing markets with a projected CAGR of 24.67%. Accelerated adoption of advanced factory automation solutions, particularly in Japan, China, and Taiwan, contributes to market growth. Manufacturing organizations recognize the benefits of robot arm technology, driving modernization efforts across factories, and subsequently, the IoT in Smart Utility and Energy Market.

IoT IN SMART UTILITY AND ENERGY MARKET- BY COMPANIES

Key players in the market include:

1. General Electric Digital (U.S.)
2. ABB Ltd. (Switzerland)
3. Siemens AG (Germany)
4. IBM Corporation (U.S.)
5. Huawei Technologies Co. Ltd (China)
6. Cisco Systems, Inc. (U.S.)
7. HCL Technologies (India)
8. Intel Corporation (U.S.)
9. DassaultSystemes (France)
10. Robert Bosch GmbH (Germany)
11. Schneider Electric SE Vodafone (UK)
12. Telit (UK)
13. Landis Gyr (Switzerland)

The industry's landscape features a plethora of large corporations, fostering a fragmented and highly competitive environment. Market leaders such as General Electric and IBM have solidified their positions through low-cost strategies, posing challenges for new entrants. Nonetheless, venture capitalists exhibit confidence in IoT startups, facilitating their market entry through investments. Major players focus on product innovation, acquisitions, and research and development activities to maintain market dominance.

NOTABLE EVENTS IN IoT IN SMART UTILITY AND ENERGY MARKET

• ACQUISITION – In March 2020, Emerson Electric Co. completed the acquisition of Verdant, a leading provider of energy management solutions for the hospitality sector, augmenting Emerson's energy management capabilities in commercial and residential applications.
• PRODUCT LAUNCH - In 2020, Honeywell International Inc. introduced integrated solutions aimed at enhancing building environment well-being and operational efficiency in commercial and residential settings.
• PRODUCT LAUNCH - ZF launched telematics-based fleet management solutions for Light Commercial Vehicle in December 2020, enhancing operational performance, safety, and customer service levels.
• COLLABORATION - Accenture collaborated with Snam in 2019 to explore IoT-based solutions for enhancing energy network innovation and sustainability.
• COLLABORATION – Itron signed a deal with a Brazilian utility firm in December 2019 to upgrade the water distribution infrastructure of Consolidated Utility District, deploying Itron Smart Water Communication Modules for improved operating efficiency and streamlined meter reading.