In-home electricity displays
To date, the two most interesting developments in the market for in-home displays – or ‘IHDs’ – have involved not only a dramatic change in the product itself, but also in the supply model. The past few years have seen movement from ‘standard’ IHDs, which use a meter clamp and transmitting unit to enable electricity consumption data to be displayed on fairly basic display devices, to ‘smart’ variants which are designed to connect to smart meters with integrated HAN gateways, and, in some cases, display more advanced information such as dynamic pricing tariffs or demand-response requests, via communication with the AMI network.
I see the opportunities for IHD suppliers are mainly of two types. First, there will be sales of ‘smart’ IHDs which are deployed by utility companies in countries where legislation or government involvement drives it. Important examples include the UK, where the deployment of IHDs is set to be mandated alongside smart meter installations; and parts of Australia, where the government is set to subsidize their deployment. Also, in a number of emerging smart meter markets, where smart meters are set to be pole-mounted (to deter electricity theft), government legislation in some countries is set to promote the deployment of IHDs to customers who cannot view their electricity meter, and who specifically request them. As a result, the market for these devices is set to ramp up very quickly; yet they are expected to be relatively basic, quickly commoditized, and offering relatively low margins for suppliers. Additionally, independent IHD suppliers may struggle in some of these markets; as smart meter suppliers look to win such contracts, leveraging existing relationships with utility companies and their ability to offer ‘pre-paired’ IHD and smart meter combinations.
Yet smart meter deployments are occurring at different rates globally and in many cases are deployed, without a HAN gateway. Further, even where HAN gateways are present, sometimes (as in parts of the United States), the HAN gateway is not enabled by the utility company, and is therefore unable to connect to energy management devices such as IHDs. Instead, another product is emerging which may offer device suppliers a better margin – particularly if they can diversify to offer other parts of the system – the ‘smart meter-agnostic energy management systems’ (catchy title, no?)
These systems (provided a smart meter featuring a HAN gateway is present and can be paired with) can use AMI information to perform functions such as display electricity consumption and, if available, dynamic pricing information, demand-response requests, etc. Yet for the many households where all these requirements have not yet come to fruition, this same system can offer value in another way. Typically, this would be via the inclusion of a meter clamp with the system, to measure household electricity information, as well as often featuring other energy management system components, such as smart plugs, and an external interface (to enable remote system access and cloud-based home management).
Rather than the direct-to-consumer retail option seen with the IHDs of old, or the utility company deployments set to commoditize some IHDs, the market for these systems is set to be driven by a range of service providers, from cable operators to ISPs and even security companies looking to move into the ‘managed home’ market. Often, IHDs will be included in such packages; IHDs are set to face hard competition from ‘soft’ displays, where electricity consumption information is instead displayed on users’ tablet PCs, cellular handsets, or even TV sets. The challenge for IHD suppliers going after this market will lie in providing an IHD with enough value that it is preferred over the ‘soft’ options. Yet by evolving to offer other parts of the smart home energy management system – or ever partnering with a platform provider to offer the entire managed systems itself – device suppliers can mitigate this risk.
Together, these markets are projected to drive the global market for IHDs from around 2 million units in 2011 to over 13 million in 2015.
IMS Research, recently acquired by IHS Inc., has recently published a report entitled “The World Market for Smart Home Energy Management Systems – 2012 Edition”. This 700+ report includes over 300 data tables, projecting the size of the market for a range of smart home energy management devices – including smart thermostats, IHDs, smart meters (with and without HAN gateways), smart plugs, smart appliances, E.V. chargers, connected PV systems, and other load control devices. Full analysis of smart meter deployment, the availability of ToU and dynamic pricing, key legislation, and a full set of country-specific device forecasts is provided for 26 separate countries or sub-regions. This includes full analysis of the network architecture projected to be predominant in each country, along with the connectivity technologies used, and the various routes to market. To discuss further, please contact Lisa Arrowsmith on +44 1933 402255 or Lisa.Arrowsmith@ihs.com