Mexico Smart Grid Market to Reach $8.3 Billion by 2020

WASHINGTON, Oct. 11, 2011 /PRNewswire/ -- Northeast Group, LLC today released its Mexico Smart Grid Market Forecast (2011-2020) which projects the total smart grid market will reach a cumulative $8.3 billion by 2020.  Mexico trails only Brazil in terms of potential for smart grid in the Latin America region.  The smart metering market in Mexico represents the biggest opportunity, with more than 21 million smart meters to be deployed by the end of the decade.  Other smart grid market segments such as distribution automation, wide area measurement, and home energy management are also projected to grow strongly over the forecast period.  

"Mexico is well positioned to develop into a leading smart grid market, both in the Latin America region and globally. Like other Latin American and emerging market nations, the country faces high rates of electricity theft and power outages, both of which can be reduced through smart grid technologies.  Mexico is also uniquely situated to benefit from positive spillovers from the US market.  These include smart grid standards, US vendors looking for new markets and a transfer of smart grid technical know-how," according to Northeast Group, LLC.

Northeast Group, LLC continues, "Mexico will also benefit from a single, state-owned utility that ensures a streamlined regulatory framework and efficient deployment.  Much like ENEL's pioneering smart meter deployment in Italy, CFE (Mexico's sole distribution utility) can ensure that smart grid deployments are quickly rolled out to all parts of the country."

Mexico's smart meter market alone will contribute $5.1 billion to the overall smart grid market value by 2020.  This includes meter hardware, communications, IT, installation costs and professional services.  Combined with Northeast Group, LLC's South America forecast (released June 2011), the total Latin American smart metering market is expected to reach nearly 126 million meters by 2020.

In addition to smart meter deployments, Mexico is projected to invest heavily in distribution automation, wide area measurement and home energy management in the later half of the decade. These other segments of the smart grid market make up an additional $3.2 billion in cumulative market opportunity by 2020.

Northeast Group, LLC's report forecasts 14 different segments of the Mexican smart grid market.  These include market values for smart metering segments (hardware, communications, IT, installation and professional services), distribution automation (substation automation, FDIR, volt/VAR optimization and grid monitoring), wide area measurement, home energy management (home area networks, smart solar inverters, and electric vehicle supply equipment) and an electric vehicle penetration forecast.  In addition to market forecasts, the report highlights domestic Mexican firms poised to partner with international smart grid vendors.

The report is 67 pages long and includes over 40 charts, tables and graphics.  Primary and secondary research was completed using English and Spanish sources.  To find out more information on the report, visit Northeast Group's website (www.northeast-group.com) or email Ben Gardner (ben.gardner@northeast-group.com).

ABOUT: Northeast Group, LLC is a Washington, DC-based research and consulting firm focused on the smart grid market in both developed and developing countries. We offer market research reports as well as client-based consulting services.  www.northeast-group.com

Key questions answered in Mexico Smart Grid Market Forecast (2011-2020) include:

  • How will the combined smart grid market develop and what is its value over the next decade?
  • What are the market possibilities for PLC and wireless mesh communications technologies in Mexico?
  • How much value will smart metering, distribution automation and home energy management each add to the Mexico smart grid market by 2020?
  • Which international vendors are already active in Mexico? Which domestic vendors are poised to partner with international firms to exploit the growing smart grid market?
  • What is the size of the professional services market out to 2020 for AMI-related projects?

Table of Contents



i. Executive Summary

1

ii. Methodology

5

1. Introduction

7


1.1 Smart grid in Mexico

7


1.2 Smart grid's role in Mexican energy policy

12

2. Mexico smart grid snapshot

15


2.1 Current situation

15


2.2 Comparison to other emerging markets

17


2.3 Electricity industry structure

19


2.4 Smart metering regulatory framework

23


2.5 Market drivers and barriers

24


2.6 Recent activity

29

3. Smart grid market forecast

33


3.1 Assumptions

33


3.2 Overall smart grid forecast

34

4. Detailed smart grid market forecast and technology
outlook

36


4.1 AMI

36



4.1.1 Meter hardware

36



4.1.2 Communications options

37



4.1.3 IT: meter data management and customer
information systems

40



4.1.4 Professional services

41



4.1.5 Installation costs

41


4.2 Wide area measurement

42


4.3 Distribution automation

43



4.3.1 SCADA and RTU systems

43



4.3.2 Advanced distribution automation

44




4.3.2.1 Substation automation

44




4.3.2.2 FDIR

45




4.3.2.3 Volt/VAR optimization

46




4.3.2.4 Grid monitoring and control

46



4.3.3 Recent distribution automation projects

47


4.4 Home energy management

48



4.4.1 Home area networks

48



4.4.2 Distributed generation: solar inverters with
communication capability

49



4.4.3 Electric vehicle supply equipment

50

5. Vendor activity

52


5.1 Domestic vendors

52



5.1.1 Domestic vendors active in smart grid
projects

52



5.1.2 Domestic vendors in the electrical
equipment field

54


5.2 International vendors

55



5.2.1 International vendors in AMI projects

55



5.2.2 International vendors in distribution
automation projects

56



5.2.3 International vendors poised to expand
in Mexico

58

6. Conclusion

60


6.1 Next steps

60



List of Figures, Boxes, and Tables




Mexico smart grid: key takeaways

3

Mexico smart grid: leading indicators

4

Figure 1.1: Smart grid value chain

7

Figure 1.2: Smart grid model highlighting focus in Mexico

8

Table 1.1: Demand response options

11

Figure 1.3: Actual and projected oil production in Mexico

12

Table 1.2: Mexican legislation and decrees affecting smart grid

13

Figure 2.1: Current installed base of smart meters in Latin
America

15

Figure 2.2: Smart meter market potential matrix

16

Figure 2.3: Per-capita electricity consumption

17

Figure 2.4: Per-capita CO2 emissions

17

Figure 2.5: Actual and forecasted GDP growth in Latin America

18

Figure 2.6: Residential electricity prices

18

Box 2.1: Smart grid throughout Latin America

19

Figure 2.7: The divisions of CFE

20

Figure 2.8: Electricity generation mix

21

Figure 2.9: Percentage renewable energy consumption

21

Box 2.2: Mexican political scene - a new PRI?

22

Figure 2.10: Global distribution losses

24

Table 2.1: Consumer appliance ownership in Mexico

25

Figure 2.11: Power outages per year

26

Figure 2.12: Renewable energy potential in Mexico

27

Table 2.2: Smart grid drivers and barriers in Mexico

28

Figure 2.13: Distribution losses in Mexico

30

Table 2.3: Existing base of smart meters in Mexico

30

Box 2.3: Mexico and the Smart Grid Maturity Model

31

Figure 3.1: Timeline of smart grid progress in Mexico

33

Figure 3.2: Combined smart grid forecast (2011-2020)

34

Figure 3.3: Mexico smart meter forecast (2011-2020)

35

Figure 3.4: Mexico smart meter penetration rate (2011-2020)

35

Figure 4.1: AMI cost breakdown

37

Figure 4.2: AMI forecast (5 components, 2011-2020)

38

Table 4.1: AMI communications technologies

39

Figure 4.3: Mexico phasor measurement unit forecast
(2011-2020)

42

Figure 4.4: Distribution automation forecast (4 components,
2011-2020)

43

Figure 4.5: Timeline of distribution automation progress
in Mexico

45

Figure 4.6: Home energy management forecast (3 components,
2011-2020)

49

Figure 4.7: Electric vehicle forecast (2011-2020)

50

Figure 5.1: Vendors active in smart grid in Mexico

52

Table 5.1: Domestic electricity sector vendors in Mexico

54

Table 6.1:  The next steps and necessary actions

60



SOURCE Northeast Group, LLC



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