Newton-Evans Research Company, Inc.

Market Indications Point to Lower CAPEX Investment and Some Project Deferrals for Protection and Control Activities in mid-2009, Rebounding by mid-2010

June 29, 2009 Ellicott City, Maryland. Newton-Evans Research Company has completed a four-month research study and survey of protective relay usage patterns in the global electric power business. Findings from more than 130 utilities located in more than 40 countries, point to a number of changes in buying patterns and usage trends since the company’s last topical study was completed in late 2006.

The percentage of digital relays in the mix of all protective relays used by utilities continues to increase. More than 50% of all generator and transmission line relays installed in the surveyed North American utilities are now digital units. The vast majority of new and retrofit units being purchased in North America and around the world are also digital relays, but in some of the protection applications studied, such as motor protection and large generator applications, electromechanical and solid state relays continue to have a niche market position.
Additional highlights from the mid-2009 study include the following:

• Worldwide sales of medium voltage and high voltage applications of protective relays currently exceed $1.5 billion. Electric utilities, industrial companies and OEM manufacturers purchase and integrate these devices into grid operations, motor controls and as components of transmission and distribution equipment such as power transformers and switchgear.
• At least five protective relay manufacturers each ship more than $150 million worth of protective relays each year. These firms include ABB, Areva T&D, GE Multilin, SEL Inc. and Siemens Energy. Several additional suppliers have annual shipments of from $25 million to $150 million.
• Electric utilities accounted for about $575-675 million worth of direct purchases of protective relays in 2008. Industrial purchases accounted for at least $350-425 million.
• Electro-Mechanical units continue to account for more than $100 million on a global scale.
• The protection and control market is now being impacted by the global recession, but is expected to rebound by mid-2010, in the views of hundreds of survey respondents to both this study and a separate CAPEX study undertaken by Newton-Evans in June 2009.

The Newton-Evans survey of protection and control officials included more than 20 detailed product functionality and related technical questions, incorporating more than 300 items of information obtained from each of the participating utilities.

The mid-2009 Protection and Control study has been published by Newton-Evans Research Company in a series of four reports. These reports are geared to the planning needs of protective relay suppliers, power industry consultants, and utility protection and control departments. These volumes include the North American Market Study, the International Market Study, Supplier Profiles, and Global Market Assessment and Outlook.

Further information on the research series The World Market for Protective Relays in Electric Utilities: 2009-2011 is available from Newton-Evans Research Company, 10176 Baltimore National Pike, Suite 204, Ellicott City, Maryland 21042. Phone: 410-465-7316 or visit www.newton-evans.com for additional information. Send email to info@newton-evans.com

Charlottesville, VA is to be one of the first U.S. cities (in addition to Boulder, CO) to integrate smart metering into their infrastructure. Dominion, Virginia’s largest investor owned electric utility, anticipates an “energy usage reduction of about 4 percent or more annually for typical residential customers through more-efficient management of energy delivery”. According to Dominion’s website, “approximately $20 million program – SmartGrid Charlottesville – to install about 46,500 ’smart meters’ in the city of Charlottesville and Albermarle County by the end of the year.”

Visit Dominion’s website or CharlottesvilleNewsPlex.com for a press release. Log on to EnergyCentral.com for a detailed article.

The Newton-Evans Research Company has published Volume One of its newest study of protective relaying usage patterns and technology trends in the world’s electric utilities.  Volume One provides detailed information on the North American market.  The 165 page report features several topical discussions and survey analysis of IEC 61850, substation cyber security, demand levels for several types of protective relays, vendor assessments and plans for future use.  Volume Two, based on survey research with international utilities, will be published by 15 June 2009.  Please contact Newton-Evans for a descriptive brochure on this report series.

Newton-Evans Research Company CEO Charles Newton participated in the POWERGRID Europe joint plenary session, “Meeting the Energy Challenge in the Face of the Economic Downturn” on Wednesday, May 27th in Cologne, Germany. Mr. Newton was joined by Colette Lewiner, Vice President and Global Leader of the Energy, Utilities and Chemicals Global Sector Unit at Capgemini; Mr.Steve Bolze, President & CEO, Power & Water, GE Energy and Infrastructure, USA; Dr. Hans Bünting, Chief Financial Officer, RWE Innogy GmbH, Germany;M. Philippe Joubert, Executive Vice-President, Alstom, President, Alstom Power Sector, France; Dr. Uddesh Kohli, Former Chairman & Managing Director, Power Finance Corporation, India; and Dr. Werner Götz, Chief Operating Officer, Renewables EnBW AG, Germany.  More than 11,600 visitors attended this year’s conference. Visit www.powergrideurope.com

For two days (April 7 and 8) this week, The U.S. Department of Energy’s Energy Information Administration held sway at the Washington DC Convention Center. This year’s 2009 Annual Energy Conference included ten panel sessions on various current energy hot topics. These sessions began following an early morning plenary session with a keynote address given by Dr. Steven Chu, the newly appointed Secretary of Energy for the United States. Several hundred people filled the meeting room to capacity to hear Dr. Chu. The next speaker, Yale University Professor William Nordhaus, discussed energy and the macro economy and then EXELON’s Chairman and CEO, Mr. John Rowe spoke on energy in a carbon-constrained world.

The first day session of most interest to me was the session entitled: Electric Power Infrastructure: Status and Challenges for the Future. The EIA’s Scott Sitzer moderated a lively and informative panel comprised of the FERC’s P. Kumar Agarwal, Dr. Tim Brennan from UMBC, and NERC’s Mark Lauby. The three panel members came at the infrastructure issues from different backgrounds, perspectives and approaches, but each hit home on at least a few of the key electric power issues confronting the nation, and indeed, the entire world.

Continue reading A Good Day in D.C. - The 2009 Annual Energy Conference

The first quarter 2009 issue of Market Trends Digest is now available. This issue includes a look back at our study of substation automation completed last year, as well as a look ahead at some interim findings from our study of protective relays which is now currently underway (scheduled for completion in May). Also included in this issue is an article by CEO Charles Newton and a brief look at Smart Grid expenditures and IT spending for Adminstrative and Operational activities in 2009 and 2013.

Click image to open .pdf in a new window.

by Charles Newton

The financial environment and economic outlook
darken many segments of the national and global economies. Will the electric power industry significantly scale back planned capital expenditures and operations and maintenance spending on transmission and distribution automation? To find the answer, we conducted a global study of capital-expense budgets.

This article is featured in the March/April edition of EnergyBiz magazine, which you can download as a .pdf from their website: http://energycentral.fileburst.com/EnergyBizOnline/2009-2-mar-apr/Tech_Front_TandD_Headed.pdf

I attended the Infrastructure 2009 Conference held in Washington D.C. last week.  This was an unexpected joy after a career that has brought me to hundreds of industry conferences around the world.  This niche conference was extremely well developed in spite of being only in the second year.

Continue reading 2009 National Infrastructure Conference

The newest edition of  the Transmission Summit Conference, was held in Washington, D.C. this past week.  A rousing panel discussion on the role of the Smart Grid in the world of electric power transmission included panel members John McDonald (GE Energy T&D), Robert Moisan (The Glarus Group), Charles Newton (Newton-Evans Research Company), and Michael Oster (Grid Storage Technologies) .   After introductory remarks from each panel member, the panelists at the March 12  session titled Implications of Smart Grid Technology for Transmission replied to questions submitted by the audience for another 60 minutes.  The session was moderated by Jim Murray, a partner with Scott Madden Inc.

For the complete agenda visit the Infocast website: www.infocastinc.com.

An article by Chuck Newton titled Better Leverage SCADA: Systems Expand to Support New Challenges and Needs was featured in the first issue of Energy Central’s newest serial, Intelligent Utility magazine. This new publication focuses on Smart Grid topics. From the website:

“The magazine addresses core smart grid components, including distribution automation, substation automation, smart meters, demand response, home area networks, intelligent consumer devices, distributed generation, SCADA, GIS, outage management systems, mobile workforce technologies, work management and asset management.”

Visit their website to get a free subscription.