COVID-19 Market Disruptions Cause Smart Meter Shipments to Tank 25% Depressing Revenues by US$3 Billion in 2020
LONDON, June 16, 2020 /PRNewswire/ -- The market disruptions due to Covid-19 pandemic will result in a 25% Year on Year (YoY) decrease in annual smart meter shipments in 2020. Consequently, smart meter YoY revenue will contract by 31% (US$3.3 billion) to reach US$7.39 billion, finds global tech market advisory firm, ABI Research. However, smart meter shipments and revenues will bounce back in 2021 with a 36% YoY growth in annual shipments and revenues exceeding US$9.5 Billion.
"As energy and water utilities prioritize their business operations, most utilities have temporarily deferred smart meter installations and have re-allocated resources to field service operations to ensure continuity of services to its end customers," explains Adarsh Krishnan, Principal Analyst at ABI Research. "Meter installation delays have also been driven by service providers and utilities complying with government guidelines on social distancing. That said, utilities that have already initiated smart meter installation programs are expected to immediately resume those installations as soon as government restrictions are eased."
In 2020, shipments of smart electricity meters will witness the sharpest contraction with nearly 30% YoY decrease in annual shipments followed by YoY decrease in smart water and gas meters at 19% and 5% respectively. Regionally, smart meter shipments will decline the most in Europe, followed by Asia Pacific and North America. In 2019, Asia Pacific region was the largest market for smart electricity meters, where China alone accounted for nearly 40% of the global shipments. "The pandemic exacerbated slowing shipment growth in China where the penetration of smart electricity meters reached nearly 70% of households by the end of 2019. The next phase of rollouts in China are expected to be much slower as utilities target households in semi-urban and rural regions," says Krishnan.
Regionally, the pandemic will affect smart meters revenues the most in APAC followed by Europe and North America as revenue shrinks by 34%, 31%, and 30% respectively. Additionally, smart meter price erosion has accelerated due to greater availability of lower cost smart meters further depressing OEMs revenues. "As utilities resume their smart meter implementation programs by 2H 2020 in many regions, smart meter revenues are expected to bounce back to double-digit revenue growth in 2021," Krishnan concludes.
These findings are from ABI Research's Utilities and Smart Grids market data report. This report is part of the company's M2M, IoT & IoE research service, which includes research, data, and ABI Insights. Market Data spreadsheets are composed of deep data, market share analysis, and highly segmented, service-specific forecasts to provide detailed insight where opportunities lie.
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SOURCE ABI Research
