The big data analytics market in the energy sector is expected to grow at a CAGR of 11.28% during the forecast period, 2022-2027. Big data analytics play a crucial role in reducing energy consumption and improving energy efficiency in the energy sector. This factor, along with other associated benefits, is expected to propel the demand for analytics in the sector.
Key Highlights The scarcity of fossil fuels is increasing the dependency on alternate sources of energy, such as solar, wave, and wind turbines, wherein consumption is increasing at a high pace. Thus, it has become imperative to use advanced tools that use big data-based analytical tools to understand the behavior or adaption of these sources of energy.
The volatility in oil prices leads to high expenditure on energy-related projects, which, in turn, creates demand for big data analytics. Owing to this factor, the need for quality information is increasing, which is likely to boost the market growth.
In the energy sector, there are many problems like predicting production demand, enhancing efficiency, load distribution and optimization, and optimizing operation processes to preserve. Many large corporates like BP and Halliburton have adopted data analytics, while there is a high scope for small companies with lesser data to achieve new heights.
The recent outbreak of the COVID-19 pandemic revealed the negative impacts of uncertainty on decision-making processes and markets. At the time point when market participants started to receive real-time information about the situation, the energy markets began to ease. This is one scenario where Big Data can be used to amplify information to various stakeholders to prevent panic and to ensure market stability and security of supply.
The growing awareness of the benefits of smart metering and increased investment in alternative energy sources are driving market expansion. Furthermore, the volatility of oil prices, the depletion of fossil fuels, and emerging trends for improved efficiency and dependability in power transmission contribute to the demand for big data analysis in the energy sector. However, a shortage of trained labor with domain-specific knowledge limits industry expansion.
Key Market Trends
Smart Metering to Fuel Market Growth
Smart metering in big data analytics involves components such as grid operations, field services, resource planning, customer experience, and regulatory compliances. It helps to predict demand and forecast based on the data collected, which is likely to boost the market growth.
Moreover, big data analytics in smart metering helps in forecasting energy consumption, which plays a vital role in the management of demand and supply and in mitigating the waste of energy. For instance, Siemens introduced the incorporation of big data analytics with smart meters to achieve deeper insights from the smart grid, which, in turn, offers data to mitigate extra energy consumption and increase profit margins.
Utilities confronting the need for transition driven by decarbonization and decentralization can benefit from unlocking the power of metering data and enriching it with other information sources like geographic information systems (GIS), CIS, and weather data. AWS Quick Start, which deploys Smart Meter Data Analytics (MDA) platform on AWS Cloud, helps the utilities to tap the unrealized value of energy consumption data while removing an undifferentiated heavy lifting for utilities. This allows utilities to provide new services such as load prediction, deeper customer engagement through proactive notifications, predictive maintenance on distribution assets, circuit quality analytics, and others.
Furthermore, depending on the business context, the individual operating systems can send data to the platform and get actionable insights out of it. For example, a request can be sent from an outage management system (OMS) to check the status of one or more smart meters and, in return, get the information to create an outage ticket from the Big Data platform.
Developing countries, such as India, Brazil, etc., are hugely investing in the energy sector, which is expected to boost smart metering with advanced big data techniques in the coming years.
Asia Pacific to be the Fastest Growing Market
Factors, such as the increasing adoption of IoT and smart technologies and various government initiatives, such as smart cities, across APAC countries, including China and India, affirm Asia-Pacific to be the fastest-growing region in the big data analytics in the energy sector market.
For instance, according to the recent data released by the National Smart Grid Mission, Ministry of Power, out of the total allocated quantity of 11.16 million smart meters, 3.73 million smart meters have been installed across various states in India as of January 2022. Furthermore, EESL aims to replace 25 crore conventional meters with smart meters in India through Smart Meters National Program (SMNP), as this would help in reducing AT&C losses.
In the APAC region, China is expected to be the leading country in big data analytics in the energy utility sector due to its large population and increasing rate of adaptation of smart metering and smart grid systems across the country.
Recently, China and India launched their first joint projects in the fields of big data and AI. The two projects, backed by India’s National Association for Software and Services Companies (NASSCOM) and the Chinese government, aim to boost the cooperation between Indian software organizations and Chinese firms in high-tech IoT and big data projects.
Additionally, there has been significantly high activity in the region’s power generation sector. Similar to the global trend, there has been immense activity in the sector to adopt greener power generation solutions, especially in countries like India, China, Japan, and Singapore, among others. Such trends are expected to drive the growth of the studied market in the Asia Pacific region during the forecast period.
The big data analytics market in the energy sector is a consolidated market, where major players have maximum market share. Moreover, owing to factors such as a lack of skilled workforce (with analytical skills and expertise), rising privacy concerns, and data breaches, new players are finding it difficult to enter the market. Furthermore, considering market penetration and the ability to invest in new technologies, the competitive rivalry is expected to continue to be high. Some of the key players include IBM Corporation, SAP SE, Microsoft Corporation, Dell Inc., Accenture, and Siemens AG, among others.
February 2022 - cQuant.io, an energy analytics company, partnered with Microsoft to scale its cQuant energy analytics solution, helping customers reduce their greenhouse gas emissions with reliable renewable energy purchases.
February 2022 - IBM and SAP strengthened their partnership to help clients move workloads from SAP Solutions to the Cloud. IBM announced teaming with SAP to provide technology and consulting expertise to make it easier for clients to embrace a hybrid cloud approach and move mission-critical workloads from SAP Solutions to the cloud for regulated and non-regulated industries.
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