Global Smart Grid Market Growth Analysis Report - Market Size, Share, Forecast Trends and Outlook (2024-2032)

Global Smart Grid Market Outlook

The global smart grid market size reached approximately USD 56.71 billion in 2023. The market is projected to grow at a CAGR of 17.5% between 2024 and 2032, reaching a value of around USD 246.21 billion by 2032.

Key Takeaways

A smart grid is a digitally enabled grid infrastructure that utilises smart devices for electricity generation, transmission, and distribution. It uses a two-way communication network and enhances the energy efficiency of electricity generation to meet the growing requirements of consumers. It also employs sophisticated automated control systems and data analytics to optimise the production, distribution, and use of electricity.

The smart grid market growth can be attributed to advances in energy storage technologies that enable more effective integration of renewable energy sources, enhancing grid stability and energy efficiency. Governments worldwide are implementing policies and providing financial incentives to encourage the upgrade of existing grid infrastructures to smart grids, thus promoting smart grid market development. These include grants, subsidies, and regulations aimed at improving energy efficiency and integrating renewable energy sources. Commitments to reduce carbon emissions under international agreements like the Paris Agreement encourage the adoption of smart grids as part of broader strategies to increase the use of renewable energy and improve energy efficiency.

Key Trends and Developments

Utilisation of smart grid for renewable hydrogen energy; applications of smart microgrids in remote areas; growing emphasis on grid security and resilience; and deployment of advanced technologies; are the major trends in the smart grid market

Smart Grid Market Trends

Smart grids play a crucial role in the effective management and distribution of renewable energy, due to their advanced capabilities for self-assessment and real-time responsiveness. They perform self-assessments by continuously collecting data from various points across the grid. This data includes information on power flow, voltage levels, and the status of grid infrastructure. By analysing this data in real-time, the smart grid can identify anomalies, potential faults, or inefficiencies in the system. When smart grids detect an issue, such as a potential overload or a fault in the system, they can take immediate action to mitigate the problem. This might involve rerouting power, adjusting the load, or isolating sections of the grid to prevent widespread outages.

Sustainability is an area that has received increased attention from researchers and energy companies. In February 2024, ENOWA created a pioneering plan for the establishment of the first-ever smart grid powered entirely by renewable energy, in a bid to support smart grid market. This groundbreaking blueprint outlines the framework for an advanced electrical grid that leverages clean energy sources to supply power efficiently and reliably across vast distances. By integrating renewable energy into a high-voltage grid, ENOWA aims to set a new standard for sustainable energy infrastructure.

Market Segmentation

“Smart Grid Market Report and Forecast 2024-2032” offers a detailed analysis of the market based on the following segments:

The solution segment accounts for a major market share as it encompasses the hardware and software involved in the proper functioning of smart grids

The solution segment holds the highest share in the smart grid market. This segment includes hardware and software solutions essential for the construction and functioning of smart grids, such as advanced metering infrastructure (AMI), smart grid distribution management, smart grid communications, smart grid network management systems, grid asset management, and substation automation.

The smart grid market encompasses energy services which include professional assistance such as consulting, deployment and integration, support and maintenance, and managed services. Services are critical for ensuring the successful deployment, operation, and optimisation of smart grid solutions. They help utilities and other stakeholders to effectively implement smart grid technologies, align them with specific operational needs, and ensure their ongoing efficiency and reliability.

The residential sector maintains its dominance in the market due to the growing usage of smart grids for enhancing energy efficiency

The residential sector occupies a significant portion of the smart grid market share, owing to the increased integration of smart metres in residential areas to provide real-time metrics on electricity consumption. Smart grids also reduce the probability of blackouts in residential buildings as they can detect and isolate the power outage, preventing it from spreading on a large scale. Smart grid technologies, such as smart meters and home energy management systems, provide homeowners with detailed information on their energy usage patterns. This enables residents to make informed decisions about their energy consumption, leading to increased energy efficiency and potential cost savings.

Meanwhile, the commercial sector is expected to witness robust growth in the smart grid market during the forecast period, due to the growing demand for uninterrupted power supply in commercial spaces. Smart grids enable commercial users to participate in demand response programmes, where they can benefit financially by reducing or shifting their energy usage during peak demand periods. This not only helps in stabilising the grid but also offers a direct economic benefit to commercial participants through reduced energy costs and incentives provided by utilities.

Competitive Landscape

The players in the smart grid market are adopting novel technologies and increasing their collaboration efforts to meet the evolving regulatory landscape

Other notable players in the smart grid market include General Electric Company, Cisco Systems, Inc., Eaton Corporation plc, ORACLE Corporation, Globema sp. z o.o., and Trilliant Holdings Inc., among others.

Smart Grid Market Analysis by Region

North America accounts for a substantial share of the market, supported by increased investment in smart grid infrastructure. The growing popularity of electric vehicles in the region also offers lucrative market opportunities as EVs can be used for the absorption of excess power from the grids. Both the U.S. and Canada have implemented supportive government policies, regulations, and initiatives that encourage the adoption of smart grids. For instance, the U.S. Department of Energy (DOE) has been actively supporting smart grid advancements through investments and research programmes.

Meanwhile, the Asia Pacific smart grid market is expected to witness a robust growth in the coming years, owing to the growing demand for electricity, coupled with the rising smart city projects in the region. The adoption of smart meters and home energy management systems is also growing in the Asia Pacific, empowering consumers with real-time information about their energy usage and allowing them to participate in demand response programs. This consumer-centric approach to energy management is expected to drive further interest and investment in smart grid technologies.

Key Highlights of the Report

Smart Grid Market Report Snapshots

Smart Grid Market Size

Smart Grid Market Trends

Smart Grid Market Share

Smart Grid Companies

Smart Grid Market Regional Analysis