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A Look at the U.S. Medium Voltage Electric Power Equipment Services Market

The total MV services market is very large – possibly in excess of $15 billion. The larger view of the MV services market encompasses multiple segments such as field and in-plant equipment maintenance and refurbishment; construction-related services for distribution substations and MV undergrounding activities; training classes for utility/C&I engineering and operations staffs; site analysis and permitting for distribution utilities and renewables projects; and MV equipment testing services, including commercial test labs and field service diagnostics and testing firms. In addition, vegetation management and telecommunications services are both very large power utility-related businesses in their own right, with significant portions of segment revenue obtained from medium-voltage projects, and these topics will be covered in articles later in 2024.

U.S. Medium Voltage Equipment Services
The U.S. MV equipment services market itself is very large (>$4 billion is our estimated minimum market size) in total, comprised of at least three major subsegments and is served by hundreds of national, regional and local-area electrical equipment service providers.

While much of MV equipment services growth for third party firms seems likely to be in the 3-5% range, there are a few areas that may see larger increases in revenues, including the upper MV ranges of switchgear, along with gas-insulated units and underground equipment. As well, transformer maintenance, repairs and retrofits are commanding more attention and relying on third party services as new transformer prices, product availability and long lead times affect grid reliability.

Numerous MV Maintenance Market Participants
In multiple research studies conducted over several decades, Newton-Evans Research has found more than 275 U.S.-based companies and organizations providing one or more types of MV-related services to electric utilities and to C&I customers. Each of these was earning related revenues of at least $10 million in annual revenue, with about 45-50 firms in the group earning in excess of $20 million annually from the provision of MV-related services. There is a growing group of domestic firms earning in excess of $250 million in MV services revenue. Another huge segment of providers offers services in addition to equipment maintenance, repair and refurbishment. These include utility staff training services, equipment testing services and some portion of construction related (design/build) services.

When it comes to MV equipment services, two product categories account for the lion’s share of segment revenue. These are switchgear/circuit breaker and distribution transformer equipment services.

MV Switchgear Services Revenue Assumptions based on Third Party Service Firm Website Information
Switchgear services and revenue seems often to be grouped with Circuit Breaker services. There are national, regional and local third-party T&D services firms that provide various levels of equipment services for utilities and the C&I communities. Some of the national names prominent in the switchgear services, maintenance and repair/refurbishment market include Shermco, CBS Services and Saber Power Services.

While many services firms are in the “small business” category and earn less than $10 million annually, there are several others that earn in excess of $100 Million from a variety of T&D equipment service offerings.

Distribution and Power Transformers
While Newton-Evans estimates as much as $900 million is spent annually on electric power transformer services and replacement parts, the majority of this amount goes for power transformers. Nonetheless, there are several firms that specialize in service and repairs for pole-top and pad-mount distribution transformers. Among the large firms that service, repair and refurbish transformers of all sizes offer nationwide services, including companies such as IPS, Sunbelt Solomon, RESA and others. A number of smaller firms specialize in maintenance, repairs for distribution transformers at a regional level, including Northeast Power, UTB Transformers and Valley Transformers, Inc.

Twenty years ago, a Newton-Evans survey found that many utilities did not bother with repairs to nor did they consider third party maintenance of pole-mount units. Unit replacement was easier and faster than was rework and repair. At that time, manufacturing capacity for pole-mounted units was sufficient to meet domestic U.S. demand, and lead-times were quite short, compared with today’s market. Most electric power utilities had been able to procure and store scores or hundreds of spare pole-top units for emergencies or time-based replacement up until the COVID years.

All Other MV Equipment Services: The third arm of MV equipment services we consider to be comprised of “all other” equipment of significant cost – that is, costing multiple thousands of dollars. It appears based on a small sample utility survey conducted during late 2023, that relatively low-cost equipment including reclosers, sectionalizers, fused, fault current limiters, surge arresters and MV capacitors were very likely to be replaced rather than repaired.

Our next article on MV Services will focus on construction-related services for distribution substations and MV undergrounding activities; training classes for utility/C&I engineering and operations staffs; site analysis and permitting for distribution utilities and renewables projects; and MV equipment testing services, including commercial test labs and field service diagnostics and testing firms.

Keep in mind if you need to have an understanding of the U.S. medium voltage equipment market, our report series of two to four page U.S. market overviews, covering 17 MV equipment types, can be helpful. The link for for further information and to place an online order is here:
https://www.newton-evans.com/product/overview-of-the-2024-2026-u-s-transmission-and-distribution-equipment-market-medium-voltage-series/

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A Janus View of the T&D Equipment, Systems and Services Market at year-end 2023. A Look Back and A View Forward for the Energy Transition in the United States

Looking back over the past 24 months, we initially note what appears to be strong growth in real unit demand for a wide variety of T&D equipment, energy automation systems and related T&D services. Most of this view developed as a result of utility and manufacturer surveying conducted over the past two years.  Along with this perceived increase in demand came higher prices and longer lead times after receipt of order by electrical equipment and device manufacturers – affecting the delivery of operational equipment, T&D-related systems and software, and the provision of related services.  So, the difficulty comes in trying to differentiate rising end-user dollar expenditures versus rising demand in units of equipment ordered or numbers of systems and services provided.

Higher prices for electrical equipment, automation real systems and T&D services accelerated in the post-COVID era, due primarily to increased costs of materials, ongoing staffing issues (and salary increases), supply chain logjams and, to some degree, slowdowns in the regulatory approval process at federal and state levels.

Separating “real” market growth from increased market values due to inflationary price pressures is often difficult, but surveying both side of the electric power equation to include end-users (e.g. utility + C&I) and industry (manufacturers, energy automation system developers and T&D equipment service providers) enable one to work through this inter-related set of activities to determine real market growth.

We tend also to rely on FRED (aka Federal Reserve Economic Data) data prepared by the Federal Reserve Bank of St. Louis and sourced from the U.S. Bureau of Labor Statistics that includes historical and current price trends for an array of electrical equipment.  As shown in the following chart, FRED, as of December 2023, depicts trends for large increases in equipment costs, exacerbated by the COVID-era disruption to the economy, and its effects on the typical economic cycle of capital equipment procurements.

Now,  look at the even more drastic manufacturing cost increases for transformers

 

Reviewing these two charts suggests that end-users of capital electrical equipment are spending more because of rising prices.  However, there is more to this story.  The revenue increases accruing to manufacturers, systems integration firms and T&D service organizations indicate that sales for these firms are moving up, rising faster than inflation, meaning true growth in spending is occurring on orders for additional new equipment and systems and replacement of aging capital equipment and legacy systems.

We are seeing growth in unit sales for a variety of equipment and systems and a surge in demand for large power transformers.  On the HV side, there is clear evidence that increased procurements have been the case throughout the country for many capital items.  A review of EEI’s current CAPEX outlook for IOUs indicated a likely rise from 2022 to 2023 of 10%-11% or so.   For transmission, there would likely have been even more growth overall, but delays with renewables projects, transmission permitting issues, and, to some extent, the delays being encountered with large power transformer orders, prevent even more significant transmission interconnection-related growth.  (Click on the chart to expand the view).

As to specific growth areas related to HV or transmission-related capital equipment, it is interesting to observe that the United States continues to invest heavily on equipment manufactured for the lower HV ranges as has been the situation for the nearly four decades that Newton-Evans has studied this market.  Upgrades to existing transmission networks will mean growth in the EHV and UHV ranges, but it has been a slower upgrade process than was the outlook a decade ago.

In the HV equipment manufacturing arena, there are a relative handful of market participants, with most being global or international firms with the capital reserves necessary to finance multi-million-dollar equipment development and manufacturing costs.  This is quite a different picture from the more numerous domestic manufacturers found in most MV or distribution categories of utility infrastructure equipment.  As well, there are only about 200 utilities having any transmission assets, and a 10x multiple of utilities providing electricity distribution services throughout the United States.

As a result of an increased number of suppliers competing for equipment orders in the MV equipment range, we see a moderation of inflationary pressure and lower levels of price increases among distribution equipment manufacturers, lower levels than are apparent among the fewer transmission equipment and large power transformer suppliers.  Lower-cost-based manufacturers of MV equipment can remain competitive, especially when” price” is the basis for procurements, as it most often is among public power utilities, given product quality remains acceptable and is IEEE/ANSI standards-compliant to end-user buyers.

In addition to the annual capital expenditures for new T&D equipment, there is a flourishing after-market for third party T&D services of all types.  There are hundreds of local and regional firms capable of providing services to a wide range of T&D equipment, and scores of these that can provide field-based or in-plant repairs and refurbishments to transformers, switchgear, circuit breakers and the like.  The American trade organization for larger T&D equipment services providers is PEARL (Professional Electrical Apparatus Reconditioning League).  PEARL is comprised of 61 national and regional T&D equipment refurbishment and service firms.  Annual revenues among these member companies total well more than a billion-dollars.

A second association of electrical apparatus services firms is the Electrical Apparatus Service Association, Inc. (EASA) is a U.S.-based, international trade organization of more than 1,700 electromechanical sales and service firms in nearly 70 countries. EASA members sell and service industrial electric motors and related rotating apparatus such as generators, pumps, fans, compressors, gearboxes and blowers. EASA members also provide services for a wide range of T&D equipment, including transformers and switchgear.

Another newer electrical equipment services association is KNOWER, with U.S. members found across the country.  While member capabilities center on electrical motors and rotating apparatus, these member firms also provide testing, repair and maintenance for switchgear, relays, and transformers.

While PEARL members tend to provide excellent services coverage for utilities and C&I firms, EASA and KNOWER tend to focus on the industrial end-user communities, with a focus on electric motors, pumps and the like and provide services to water utilities.  The reason I have included an overview of T&D services firms and organizations in this “look-ahead” article is this.  As the involvement of more third parties in the process of generation and transmission of electric power continues to increase, there will be a corresponding increase in reliance on equipment service providers that are already well-versed in serving the C&I community.  The C&I sector is expanding to include renewable site asset owners together with the site-specific wind plant and solar farm operators.  Together, these sites are adding multiple thousands of units of T&D equipment and a hundred or more new substations to the evolving grid each year.  Click to expand the view of my T&D services wheel.

Next month, I plan to write about the various building blocks of activities that encompass a broader view of T&D equipment services, from training and testing, to equipment monitoring and diagnostics.

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Cybersecurity and Cyber Crime in the Energy and Utilities Industry

 

On the front lines of cyber security imperatives and OT/IT concerns are the world’s energy industry companies and utilities.  Energy-related companies and utilities in each sector – electricity, gas and oil and water communities face serious cyber challenges on a routine but persistent basis throughout production, transmission and distribution activities.  Because these communities and the infrastructure they represent are so vital to modern civilization, they are most often targets for bad actors, whether the bad actors are rogue nation-states, criminal groups or hacktivists.

Added to the attractiveness of these infrastructure industry segments for cybercriminals is the ever-growing attack surface that is a result of two things: rapid deployment of field automation, extending the purview of operational control systems to distribution beyond traditional “fences” using less secure wireless communications methods, compared with wire-line approaches to data communications.  As the world modernizes and automates its infrastructure delivery methods, it does so while cyber security standards, checks and balances lag and while regulatory oversight sometimes languishes.

It seems the faster we move toward full-scale automation, the “behinder” we are with cyber-physical security implementations.  Cybercrime reporting is still in its infancy relative to the level of cybercrime events.  Cyber-criminal law needs to be strengthened and severe penalties enacted on a global basis so that strong deterrents will work effectively in the future.

The economic costs associated with cybercrime continue to increase dramatically with each passing year.  The IMF and the U.S. FBI have estimated the 2022 impact of cybercrime around the world stood at an astounding 8.44 trillion USD.  As if that wasn’t bad enough, the outlook is for that amount to nearly triple by 2027, to 23.82 trillion USD.  The World Bank report for 2022 indicated a global GDP value of nearly 101 trillion US dollars.  With more than 8 trillion US dollars estimated to have been lost to cybercrime, this unfortunately has a dampening effect on global economic growth.  The losses of the world economy to cybercrime have the effect of lowering global GDP (1) value by several percent, according to Newton-Evans Research Company, which has been including cyber-security related questions in its industry surveys for nearly 30 years.  Newton-Evans has also served as a lead international survey partner for several CIGRE working groups for the past 15 years   Click on Figure 1 below for chart expansion of frequently used range estimates of dollar losses to cybercrime.

In 2018, the World Economic Forum’s (WEF)  Centre for Cybersecurity launched the Systems of Cyber Resilience: Electricity initiative. This groundbreaking effort helped bolster the cyber resilience of the global electricity infrastructure by bringing together leaders from over 60 businesses, governments, civil society, and academia. The objective was to develop a comprehensive cybersecurity vision to protect the power infrastructure.

During 2023, the WEF’s Centre for Cybersecurity and 11 founding members (2) comprised of electrical equipment manufacturers, systems integrators, cybersecurity firms and utilities launched a new iteration of the initiative known as Systems of Cyber Resilience: Electricity.  The objective of this new program is to establish “. . . an independent multi-stakeholder community that will continue to collaborate and take collective action.  The community will serve as a global exchange platform for cybersecurity leaders in the electric sector.”

The WEF initiative for the electricity sector has already resulted in the publication of three sector-relevant white papers.  These are:  Cyber Resilience in the Electricity Ecosystem: Principles and Guidance for Boards; Cyber Resilience in the Electricity Ecosystem: Playbook for Boards and Cybersecurity Officers; and Cyber Resilience in the Electricity Ecosystem: Securing the Value Chain.

In one estimate prepared by Accenture, the estimated combined foregone revenue losses shared among utilities and other energy companies over the five-year period 2019-2023 was forecasted to be more than $400 million USD.

Now for the role of telecommunications in the mix.  The ITU (International Telecommunications Union) is the UN agency charged with responsibility to “…maintain and extend international cooperation among all the Member States of the Union for the improvement and rational use of telecommunications of all kinds.”  The ITU promotes the shared global use of the radio spectrum, facilitates international cooperation in assigning satellite orbits, assists in developing and coordinating worldwide technical standards, and works to improve telecommunication infrastructure in the developing world.

A fundamental role of ITU, based on the guidance of the World Summit on the Information Society (WSIS) and the ITU Plenipotentiary Conference, is to build confidence and security in the use of Information and Communication Technologies (ICTs).  Back in 2007, the ITU launched the Global Cybersecurity Agenda (GCA), as a framework for international cooperation in this area.

Private Sector Reporting on Cybercrime:

McAfee and the Center for Strategic and International Studies (CSIS) released a well-researched 2018 white paper entitled “Economic Impact of Cybercrime – No Slowing Down.” (3)  This 23-page report is full of still-pertinent information on the pervasive effects of cybercrime.

The report identified some of the hidden costs from the aftereffects of cybercrime including loss of intellectual property and confidential business information; online fraud and financial crimes, financial manipulation, opportunity costs, and reputational damage.

The report recommended uniform implementation of basic security measures, including regular updates and patches, and open security architectures; discussed the need for increased international law enforcement cooperation; expressed improving or replacing existing processes such as the Mutual Legal Assistance Treaty, which allows one government to request the help of another in investigating cyber crime or obtaining evidence.

In late 2018, Deloitte, The UK-headquartered global professional services firm, published a white paper entitled “Managing Cyber Risk in the Electric Power Sector. “ (4)   The Deloitte report pertains to the global electric power community, though the chart referenced  in the article was developed from available US information.  In the figure provided in the article, one can note the relative importance placed on various threat actors and their business and operational impact from key types of cybercrime activities.

While criminal gangs are most likely to cause financial loss and theft of customer data, rogue nation-states are more likely to focus their efforts on destruction of infrastructure as well as theft of customer data.

In late 2020, McKinsey & Company also wrote about the threat of cybercrime against the energy industry and provided approaches to addressing vulnerabilities peculiar to energy infrastructure.  In the McKinsey article, the authors defined four levels of security zones for a power-generation plant, and discussed how utilities can set up a best-practice approach to cyber security. (5)

In 2022, Accenture published a paper on cybersecurity for utilities. (6)  In the paper, the company’s authors reported having observed three characteristics that make utilities especially vulnerable to cyber threats.

  • increased numbers of threats and actors targeting utilities: nation-state actors seeking to cause security and economic dislocation, cyber criminals who understand the economic value represented by this sector, and hacktivists out to publicly register their opposition to utilities’ projects or broad agendas.
  • The second vulnerability is utilities’ expansive and increasing attack surface, arising from their geographic and organizational complexity, including the decentralized nature of many organizations’ cybersecurity leadership.
  • The electric-power and gas sector’s unique interdependencies between physical and cyber infrastructure make companies vulnerable to exploitation, including billing fraud with wireless “smart meters,” the commandeering of operational-technology (OT) systems to stop multiple wind turbines, and even physical destruction.

This year, the U.S. Securities and Exchange Commission has enacted Code of Federal Regulations (CFR)  Rule #17, which stipulates that publicly traded companies must report cyber security incidents and must provide some information about their cyber security methods and procedures.  The ruling is mandated to come into effect mid-year 2024.  This ruling will affect all investor-owned electric, gas and water utilities as well as other publicly traded energy industry companies. Here is a section of the ruling:

The Securities and Exchange Commission (“Commission”) is adopting new rules to enhance and standardize disclosures regarding cybersecurity risk management, strategy,governance, and incidents by public companies that are subject to the reporting requirements of the Securities Exchange Act of 1934. Specifically, we are adopting amendments to require current disclosure about material cybersecurity incidents. We are also adopting rules requiring periodic disclosures about a registrant’s processes to assess, identify, and manage material cybersecurity risks, management’s role in assessing and managing material cybersecurity risks, and the board of directors’ oversight of cybersecurity risk.. (7)

In summary, there is no shortage of good information available on measures that, taken together, may enable utilities and the energy industry in general, to form a more robust and increasingly resilient defense against pervasive cyber threats and cybercrime.  When I review where the industry stands today, and compare it to the millennial year, however, what appears to be worrisome is a perception that we are not yet always including cybersecurity and cyber defense at the top of the concerns when initiating new and further afield methods of grid and pipeline monitoring and control.  This gap can be significantly narrowed if we place cyber expertise, supply chain component knowledge and software bills of material on a strategic planning level within our utilities, other energy firms and commercial/industrial entities supporting the utility/other energy communities. The SEC ruling will mean advances in cyber reporting, but that still leaves similar reporting yet-to-be-required in such a manner among public utilities, cooperatives and privately-held energy companies.  Click on Figure 2 to expand for a view of Newton-Evans’ perception of the growing gap between energy industry attack vectors and cyber defense capabilities.  With strong efforts from both the public and private sectors around the world, this gap can be narrowed significantly in the coming years.

On October 23, 2023, Interpol released information about the take-down of a notorious cyber-criminal gang – Ragnar Locker Ransomware group, headquartered in Western Europe.  This criminal organization had targeted critical infrastructure over the years.  A detailed write-up can be found here:  https://www.europol.europa.eu/media-press/newsroom/news/ragnar-locker-ransomware-gang-taken-down-international-police-swoop.  Hopefully this will be but one of many take-downs of cyber criminal organizations in the months and years ahead.

During 2024, be on the lookout for CIGRE WG D.54’s (Regulatory Approaches to Enhance EPUs Cybersecurity Frameworks) scheduled publication of a technical brochure that includes findings from surveys of electric power utility (EPU) officials involved with cybersecurity from nearly 40 countries and another survey of national regulators and their roles in ensuring cyber security within their country’s borders and sharing with the international community.  This CIGRE working group has had the benefit of cooperation from delegates and survey participants located in North and South America, Western, Central and Eastern Europe, Africa and Asia.

End-notes:

  1. According to the World Bank, the global GDP reached 100.56 trillion US dollars in 2022. See https://data.worldbank.org/indicator/NY.GDP.MKTP.CD .
  2. The 11 founding members include Dragos, EDP, Enel, Hitachi Energy, Iberdrola, Naturgy, Ørsted, Schneider Electric, Siemens Energy, Southern Company and Vestas.
  3. https://csis-website-prod.s3.amazonaws.com/s3fs-public/publication/economic-impact-cybercrime.pdf
  4. See https://www2.deloitte.com/content/dam/insights/us/articles/4921_Managing-cyber-risk-Electric-energy/DI_Managing-cyber-risk.pdf .
  5. https://www.mckinsey.com/capabilities/risk-and-resilience/our-insights/the-energy-sector-threat-how-to-address-cybersecurity-vulnerabilities
  6. https://www.accenture.com/content/dam/accenture/final/a-com-migration/pdf/pdf-177/accenture-cybersecurtiy-for-connected-energy-ecosystems.pdf#zoom=40
  7. https://www.sec.gov/files/rules/final/2023/33-11216.pdf

 

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Tremendous Growth in Deployments of Battery Energy Storage Systems (BESS)

Introduction:

The Department of Energy’s primary energy statistics provision unit is the Energy Information Administration, originally chartered to provide unbiased information on energy production and usage for the U.S. Congress.  The separate EIA website further states The U.S. Energy Information Administration (EIA) collects, analyzes, and disseminates independent and impartial energy information to promote sound policy decision-making.  Overall, the DOE employed 15,124 people as of July, 2022.  Of this total, only about 350-400 personnel work within the Energy Information Administration, according to a recent Congressional Research Service report prepared for Congress.

Article Focus:

This article focuses on the rapidly developing market for large-scale bulk energy storage systems in the United States.  Much of the source information for this article has been provided by the DOE’s Energy Information Administration (EIA). The EIA early release of Form EIA-860, Annual Electric Generator Report, issued in July, 2023, is found here: https://www.eia.gov/analysis/studies/electricity/batterystorage/  .

Note in the accompanying chart (Figure 1) the tremendous growth spurt in total MW of BESS capacity over the 2019-2022 years, extending out to the projected new installations now planned for 2023 and 2024.  By year-end 2022, nearly nine GW of BESS capacity had been installed in the U.S.  Note:  Click on each chart to enlarge:

Importantly, BESS usage can be viewed on multiple levels and from various angles.  For example, units can be seen by age of the installation, by location of the units, by installed cost based on duration of capacity, by ownership type, whether the BESS units are stand-alone or are co-located with power generation facilities (fossil and renewables), and from a ranking of applications served by the BESS unit.

The second chart shown here (Figure 2) portrays the ISO/RTO regional locations of BESS by MW of installed capacity.  Note the high proportion of currently installed BESS power capacity that is found within CAISO (53% of the nation’s total at YE 2022), and ERCOT (with about 23% of the nation’s total).  The remaining nearly one quarter of installed BESS capacity is shared among five regions (NYISO, ISO-NE, PJM, Florida and “all other areas”).

The next chart (Figure 3) illustrates the dominant role of “stand-alone” BESS installations.  BESS plus solar sited installations are also significant, amounting to 3,235 MW of capacity. BESS co-located with fossil generation facilities is relatively important, providing 874 MW of capacity. The one surprising observation (to the author) is the relative scarcity of BESS installations co-located with wind farms, hydro and other generating facilities.

As mentioned earlier in this article, there are myriad additional ways to look at BESS installations.  In terms of applications used as the basis for installing BESS units, Frequency Regulation was the response having the most MW of capacity (6685), Arbitrage was second (5214 MW), followed by Spinning Reserve or Ramping (4935 MW) and Excess Generation storage (2963 MW).  Lower down in BESS installation application rankings  included voltage or reactive power support, load management, system peak shaving and load following.

Another approach to segment assessment involves a look at ownership types.   IPPs (Independent Power Producers) are responsible for a majority of installed BESS MW of capacity (7232 MW),  Electric utilities account for about 1463 MW of installed capacity and C&I firms for most of the remaining installed capacity.

As things look right now, and if supply chains can improve so that the necessary components of battery energy storage systems can continue to be manufactured, assembled and installed to meet market demand levels, the BESS market is destined to continue growing at high double digit levels through much of the remaining 2020’s.  By YE 2024 it appears to us that the equivalent of more than 30 GW of BESS power capacity will be installed and operational throughout the United States.

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Substation Automation and Integration Services – Guiding the Way to the Digital Substation

Substation Automation Integration Specialists are firms (or business units of large electrical equipment manufacturers) that can assist with or develop and provide a full or partially automated electric power substation on a turnkey basis, leading to “digital substations.” These companies help utilities and C&I firms toward digital substations.  Such firms include dedicated businesses (see examples below) or can be business units of larger companies engaged in the electric power automation business as EMS/SCADA suppliers, RTU/PLC/PAC/gateway manufacturers or protection and control specialists.  As well, T&D engineering firms, from the nation’s TOP 10 in size and reach, to dozens of smaller but capable regional service businesses are involved in helping utilities and C&I firms integrate and automate (or digitize) the nation’s nearly 70,000 utility T&D substations and another several thousand substations that are managed and operated directly by C&I firms, including large renewables installations.

 

Four “tiers” of substation integration providers are included in our assessment:

  • Specialist substation automation integration service revenues in 2022.es
  • SCADA industry participants with substation devices (RTUs, FEPs, Relays, IEDs, platforms) offering substation integration expertise
  • National T&D Engineering Services firms with substation integration expertise
  • Regional T&D Engineering Service firms

Together, these automation and integration services providers accounted for nearly $400 million of substation automation and integrations services-related revenue in 2022 (Newton-Evans estimate).  Click on chart to expand view.

Turnkey costs for substation integration services range from an estimated $45-55,000 for a small distribution substation having few feeders to upwards of $250,000 for a large transmission substation. Some metro-area MV substations with 20 or more feeders can cost upwards of $300,000 to automate and provide device integration services.

The automation equipment/device costs are in the range of $50,000-250,000 for a distribution substation and can range up to $500,000 for smart equipment and integration services in EHV transmission substations.

These totals shown in the chart below for automation and integration services are but a portion of the total expenditures allocated to electric power substations.  New substation construction (greenfield) and up-rating activities (brownfield) account for a few billion dollars, while substation equipment and communications costs also account for several billion additional dollars.

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Wind Turbine Controls Usage Patterns Study Underway

During April and early May, Newton-Evans Research is conducting studies on the American wind power market.  Of specific interest is the  wind turbine controls segment of the fast-growing renewables business.

We are researching the types and brands of control devices and control systems that are in use among the more than 72,000 wind turbines installed in the United States as of January 2023.¹

Importantly, most controls within the wind turbine itself are provided by the OEM – the wind turbine manufacturer.  In the U.S., that likely means one of six manufacturers that account for 90% of all utility-scale wind turbine installations as of January 2023.  Three of the six (GE, Vestas, Siemens Gamesa) accounted for a whopping 82% of wind turbine installations.  Three others (Mitsubishi, Nordex and Suzlon) account for nearly 6,000 operational wind turbines operating throughout the country.  In addition to the major OEMs, there are more than 10 other manufacturers having at least 50 or more operational U.S. wind turbine installations.  See Figure 1. (Click on the figure to expand the view).

When it comes to wind turbine controls, multi-site wind farm operators and owners have more say in determining control devices and control systems selections as needed, especially for controls that reside external to the wind turbine.   Larger wind farms configured with wind turbines from multiple manufacturers also tend to have more interest in procuring PLCs, SCADA systems and plant-wide and multi-plant control and monitoring systems.  Wind farm operators and owners also tend to make more of the turbine control selections when it comes to retrofitting wind turbines.

There are more than a dozen wind controls specialist firms actively marketing and installing pitch and yaw controls, and/or condition monitoring systems in the United States.  Many wind turbine control specialists active in the U.S. are headquartered in European countries having extensive wind power installations and decades of wind power experience, led by firms based in Denmark, with others in Spain, Germany, Austria and Italy.  Some companies provide their own fine-tuned PLCs and wind-specific SCADA systems (you can read our 2021 article on renewables SCADA here): https://www.newton-evans.com/scada-systems-for-the-renewables-energy-industry-and-adms-for-utilities/.

We are still seeking a few additional participants to two short surveys.  One survey is geared to wind farm operators/owners, and can be answered by experienced wind turbine technicians.  The second survey addresses the OEM and wind turbine controls supplier community.  If you qualify to participate, please contact Chuck Newton (cnewton@newton-evans.com) and a link to the appropriate survey will be forwarded. 

Note:  1. Wind turbine installation data is provided by the U.S. Geological Service:  https://eerscmap.usgs.gov/uswtdb/

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Voltage Regulators –Guardians for Maintaining High Quality Power Distribution

 

Voltage Regulators –Guardians for High Quality Power Distribution  –   In an electric power distribution system, voltage regulators may be installed at a substation (1p/3p) or along distribution lines/feeders (1p) so that all customers receive steady voltage independent of how much power is drawn from the line. The distribution automation portion of the VR market is primarily for automated control of single-phase units installed along MV distribution lines.  In both distribution feeder and substation applications, VRs are often paired with power capacitors.

Currently the single most important factor behind the growth in use of single-phase VRs is the increase in installations of distributed energy resources (DERs) and the impact that these grid-connected resources are having on grid voltage stability.  Because of the variable or intermittent nature of DERs, there is a need to control voltage fluctuations, hence the push to utilize more VRs by utilities that are actively involved with DERs in their service territories. New construction of C&I sites, residential developments in the suburbs as well as feeder length in large rural areas are also key factors affecting the increase in use of VRs.  Certain regulatory actions in place or planned will continue to influence the need for VRs.  See the chart just below for a look at key drivers for using VRs among IOUs, Public Utilities and electric power cooperatives.

Click on chart to enlarge! Keep in mind that the nation’s electric power delivery/distribution system was designed for one-way (or uni-directional) power flow, and with the development of DERs, we are confronted with a need to accommodate two-way (bi-directional) power flows.  This changes the feeder voltage profile making voltage regulation more challenging, with DERs tending to cause local voltage rise along a distribution feeder.  The expansion of variable renewable generation resources owned by industrial/commercial companies will mean growth in the non-utility/C&I portion of the VR market.  VRs will continue to be used to control voltage levels from these intermittent resources.

 Market Size Summary:

Some suppliers have suggested to Newton-Evans that growth of 10-15% per year is on the horizon.  A lot will depend upon continuing economic recovery and the promulgation of DER-friendly policies and regulations being planned over the coming years.  Currently, there are three principal manufacturers of automated voltage regulators serving the domestic U.S. market.  These are General Electric, Eaton Corporation and Siemens.  Together the “Big Three” control about 75-80% of the combined VR market.  Howard Industries is next, followed by Schneider Electric, Delta Star and Basler Electric with each having a few dozen important utility customers and together comprise the remaining 20-25% of the VR equipment manufacturing market.

Market Drivers:

Currently the single most important market driver for using VRs is the increasingly important role of distributed energy resources (DERs) and the impact that these resources are having on grid voltage stability.  Because of the variable nature of DERs, there is a need to control voltage fluctuations, hence the push to utilize more VRs by utilities that are actively involved with DER in their service territories. New construction of C&I sites and residential developments in the suburbs are also key factors affecting the growth in use of VRs.  Feeder length among suburban, exurban and rural areas and some regulatory actions also impact the need for VRs.  Perhaps offsetting some of the demand from DER sites will be a new generation of smart inverters that may be able to provide voltage stability from DER sites to the grid interconnection point, perhaps nullifying the need for a separate VR on-site.  The publication of IEEE 1547-2018 provides for performance criteria for DERs including such functionality as Volt-Var control which can also be used to help regulate the distribution system.

Operational Driver:

While the use of single-phase VRs can be found among many hundreds of IOUs, public utilities and cooperatives, the use of three phase VRs is less widely used among munis and co-ops.  Many of these utilities have switched to using single-phase units where, in the past, they may have used a three-phase unit.  There are also about 10-15% of utilities that do not use VRs, but rely on on-load tap changers (OLTCs) with substation transformers – most within urban corridors with relatively short distribution feeders.  You may want to return here for more articles on grid modernization over the coming weeks and months.

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Distribution Line Sensing: Approaches to Monitoring Distribution Feeders for Power Quality and Improving Reliability Indices

Newton-Evans Research has developed the following info-graphic illustrating what the company believes to be a T&D market segment wherein growth is currently outpacing some other “smart grid” related developments.  This is the distribution line sensing equipment/device (or DLS) market.  For this article I have combined two related sub-segments of the DLS market – distribution fault indicators and line-mounted monitoring devices. With more than a quarter million primary distribution feeders in operation in the U.S. there is a growing requirement to monitor feeder performance, as is now being done on several thousands of the most critical distribution feeders in operation throughout the U.S. and Canada.  Implementations of DLS systems are being undertaken to shore up grid reliability, provide resilience and help minimize outage frequency and outage duration.

Two excellent baseline studies completed by the DOE’s PNNL a few years ago have helped with understanding related power distribution grid trends in the U.S. (1)   These reports, along with periodic DOE grid modernization reports to Congress, have provided the impetus for Newton-Evans to continue researching grid modernization, taking into account some of the ground-breaking activities being undertaken by many of the nearly 3000 U.S. and Canadian distribution utilities. Newton-Evans will soon be conducting the third in a series of short-length, repetitive surveys conducted over multiple years.

    • Distribution Fault Indicators  are devices which indicate the passage of fault current. When properly applied, they can reduce operating costs and reduce service interruptions by identifying the section of  feeder that has failed. At the same time, fault indicators can increase safety and reduce equipment damage by reducing the need for sometimes hazardous fault-chasing procedures.  The bulk of installed basic fault indicators are stand-alone devices that provide visual alerts at fault locations along the feeder.
    • Line Mounted and line post mounted MV/DA monitoring devices perform online monitoring of voltage and/or current and/or loads, but do not provide controlling functions. Power sources may include power lines themselves using CT/PT technology, batteries, or even small solar panels. Modern line monitoring devices are typically part of a tri-partite system comprised of the line-mounted sensors, a communications modem and PC-based (or SCADA-based) analytical software. This allows for local or remote monitoring of the device. Some devices are designed with lighted indicators for onsite/local line problem status notification, as are the DFIs so designed.
    • On average, the typical respondent utility in our first DLS study (a commissioned research program) had about a third of a million customers. Overall, the participants in that study accounted for about a 12% sample of the quarter million (3) MV feeders then in operation across North America. A second study was conducted informally during 2020-2021 with a smaller sample of utilities.
    • Almost all of the survey participant utilities in both Newton-Evans’ studies were using some form of basic line sensor/fault current indicator technology on at least some of their operating feeders. Several utilities were using smart sensors by 2019 and a few were using the then-newest generation of advanced multi-attribute line sensors by 2021.
    • The top attributes being measured or monitored among a large group of listed attributes included fault detection, current monitoring, fault magnitude, voltage measurement and time stamping of events. In the more recent (2020-2021) informal follow-on to the 2019 study, these attributes remained as key benefits of smart and intelligent line sensor program adoption.
    • On the topic of data/status communications for smart or advanced line sensors, a significant percentage of respondents (about one-third across two surveys) reported that their line sensor installed base was using built-in communications with about one quarter of installed devices reporting to line-mounted communications modules – using a mesh networking approach.
    • Distribution line sensors by 2021 were most often reporting to SCADA systems (as indicated by about one half of respondents) while about one in five officials cited communications links to the utility’s outage management system (OMS).
    • Line sensor placement by 2021 was being determined by:
          1. evaluating feeder performance and starting with the instrumentation of weaker performing feeders and “critical” customer feeders.
          2. Analyzing customer density and load characteristics on the feeder. Typically, the higher the customer density coupled with the criticality of the feeder, coupled with larger load-carrying feeders were prime candidates for line monitoring installations.
          3. Locating sensors strategically- near switching points, along with feeders routing power to hospitals, police, fire, military installations, government facilities.
    • Importantly, line sense device/system decision-making criteria to both earlier groups of surveyed utilities centered around four attributes: “reliability and long service life”, “ease of installation”, “battery-free operation” and “price.”  It will be interesting to see how these compare this summer with a 24-month interval between studies.
    • In addition to distribution line sensors and line-mounted monitoring devices, there are ancillary market segments that utilize the same, or similar, sensing and communications technology as found in transmission lines, underground lines and T&D capital assets, including substations and field equipment.

Newton-Evans will be re-surveying participants from the earlier distribution line monitoring studies, as well as including additional utilities in a planned mid-2023 update to these earlier research efforts.  Interested parties can contact Newton-Evans for further information regarding participation as sponsors or as survey participants.

__________________

Sources: 

  1. U.S. Department of Energy, Pacific Northwest National Laboratory, Electric Distribution Systems – Volume 3 (July 2016) and Modern Distribution Grid – Three Volume Study (2017)
  2. “Smaller” utilities involved in the Newton-Evans studies included those having at least 30,000 customers. Note that there are also more than 1,500 North American electric power distribution utilities with each having fewer than 30,000 customers.
  3. As estimated by Newton-Evans, based partly on the PNNL studies cited in footnote 1 above and as accounted for in Newton-Evans own files of counts of primary feeders.
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Reviewing Market Studies from the COVID years now passed. . . and a brighter look ahead . . . a Janus view!

During the past 36-month period, Newton-Evans Research studied a few topics that we had not researched in prior years.  These topics included data diodes, synchronous condensers, battery energy storage systems and network transformers. During the months leading up to the Covid era of 2020-2021, we also completed studies of distribution line sensors and uncovered trends in application of voltage regulation devices.  During 2020, we looked in-depth at electric vehicle adoption rates and prepared a mid-range outlook for grid modernization programs.  Here are some of the more interesting and perhaps relevant insights gathered from some of these research assignments.

Data Diodes:

Data diodes have been around for decades.  These devices are most often used by the military and by critical infrastructure organizations around the world.  Data diodes and unidirectional gateways are network appliances that allow data to travel in only one direction.   Typically, these devices are used as connections between two or more systems of differing security classifications, such as operational control systems transmission of data files to IT systems.

The product life cycle for these devices in the U.S. energy industry is still in its embryonic stage in some segments (T&D, renewables); while in other energy segments (TOP 25 energy companies) the product life cycle is clearly in the growth phase, and in a few segments (nuclear plants, large oil refineries) data diodes are nearing the maturity stage.

Energy industry spending in the United States on data diodes/unidirectional gateway systems now exceeds $25 million annually.  The majority of equipment sales have been limited to the largest oil and gas companies, large power generation facilities, nuclear plants, and to some larger electric power transmission and distribution utilities.  Our own limited surveying in 2022 indicates additional evaluations are now underway for data diode – unidirectional gateway use in more T&D applications and among a broader array of utility types and sizes.

Battery Energy Storage Systems – BESS.

The battery energy storage systems (BESS) market in the United States has grown exponentially over the past decade.  The Energy Information Agency (EIA) within the Department of Energy has maintained a repository of information on energy storage trends in the United States.   The total energy storage capacity for electricity exceeded 1000 MW and about 1700 MWh by 2020, according to the EIA.  Published commercial sources report that the growth trends for BESS continued during the COVID pandemic and further reported that battery energy storage capacity is larger than the numbers last reported by EIA.   For one example, IHS-Markit reported recently that battery energy storage amounted to nearly 2000 MW in 2019, and had grown to 4,000 MW by 2021.

Battery R&D Today in the United States . . . Key to independence and assured supply in coming years!

  • Very active level of battery R&D underway
  • Battery R&D start-ups funded largely by private investment firms.

Services Provided by Battery Manufacturers

  • Major Li-Ion battery manufacturers are becoming (or planning to become) full-service partners with utilities – providing integration and maintenance services, thereby attempting to cut out the “middleman” integrators currently involved in BESS Engineering, Procurement and Construction/Integration, thereby shortening the supply chain.
  • Utilities are currently using one, two or all three of these sources for BESS integration: battery manufacturers, BESS integration specialist firms, or their own engineering staffs.
  • The Newton-Evans’ commissioned survey conducted as part of the study found a number of commercial BESS integration services being used by large electric utilities.

Synchronous Condensers:

There are four drivers that affect the U.S. market (in terms of annual opportunities and units of syncon equipment) for synchronous condensers (or syncons) that exists today.  These drivers include  early shutdowns of fossil power plants; loss (or erosion of) of spinning reserves;  increased use of distributed energy resources and its impact on grid stability; and, the lack of grid-forming devices.

What we have heard is that utility/plant engineering staffs are looking for reliable, cost-effective approaches to deal with the threats to grid stability in some utilities and in some regions of the country caused by the above-listed drivers.

“About 15% of the US fossil fuel power fleet shuttered between 2009 and 2018. But most of these plants are built to last 30 to 50 years, long enough to pay off the hundreds of millions of dollars it takes to build them. To meet (President) Biden’s 2035 goal, many plants will inevitably have to be switched off before the end of their natural lifespan.” (Source:  Yahoo Finance).  There are a total of about 10,400 fossil-powered generators in the U.S. and about 3,500 utility-operated or commercially-operated fossil plants (source: EIA).

U.S. coal power capacity peaked over 317,600 MW in 2011, according to EIA data. It has declined every year since and was down to about 216,800 MW by the end of 2020.  By year-end 2022, the figure yet to be reported by EIA, coal power capacity will likely be less than 200,000 MW.

We found that even though synchronous condenser equipment has been available for more than a century, and implementations have been quite  successful in providing grid stability, voltage support and short circuit capacity and in offsetting the lack of grid-forming devices, there are other FACTS-based approaches to meeting similar grid operational requirements.

Nonetheless, there is a resurgence of interest in syncon technology and a wave of recent utility reviews are ongoing for both very large MVAR capacity units, as well as for syncon units that could be installed at key medium voltage substations and at DER interconnection points along the grid. The overall U.S. market for syncon equipment may well reach the quarter billion dollar level by 2024, in our opinion.

Network Transformers:  Industry’s Response to Densely Populated Inner-City Areas

Network transformers are vault or subway type units of equipment and are not pole, pad or substation units. The specifications for vault and subway are very similar with substation units having better corrosion specifications. NWTX units are designed for mounting in underground rooms and are common in dense city locations where surface mounted transformers would be a visual and traffic obstacle.

Network Transformers (NWTX) typically range from 300 kVA to 2,500 kVA three-phase. The Primary voltage ranges from 2400 VAC to 34,500 VAC and the secondary from 600VAC to 208 VAC. The type may be oil, dry or cast coil. The primary is usually delta connected, and the secondary is wye connected. The high-voltage connection is usually to a network switch or an interrupter-type switch. The secondary connection is usually to a network protector or a low-voltage air circuit breaker.

Downstream protection equipment is almost always provided separately and not bundled into the NTWX sale. All come with a basic DNP3 interface, but no suppliers currently add any type of asset management software. Standards for NWTX are C.57.12.24-2016 and C.57.12.40-2017.  All suppliers to the North American market meet these standards for NWTX units. Some older rebuild units, however, may not meet these standards.

Liquid filled NWTX systems traditionally came with mineral oil fill but FR3 10C is now the most popular fill. The 2016 DOE energy standard did require all suppliers to upgrade their NWTX products.  Virtually all NWTX transformers are built to order and virtually none are stocked ready to ship. There appear to be too many variables in the voltages, material of construction, gauges, piping, etc. to justify stocking a ready supply of NWTX units.   The manufacturing process may take about 6 weeks from receipt of order. None of the suppliers we interviewed see much change in the regulations over the mid-term, since the adoption of the  DOE 2016 specification, so product designs should remain stable going forward for the next few years.

Perhaps the most important regulatory driver affecting the future of network transformers is the increasing need among critical infrastructure facilities (hospitals, commercial centers, military installations, certain micro-grids) requiring reliable, resilient electric power.  Secondary and spot networks comprised of network transformers and network protectors can help urban utilities meet these requirements.

Network transformers have been playing a critical role in keeping the lights on in major urban centers for decades.  NWTX installations have been highly reliable as silent “partners” in the provision of power critical to commerce, industry and government offices.  Secondary and spot networks have proven their worth as they have continued to work in a near “fail-safe” environment.  This is often seen in power outages occurring in the same metropolitan area not being served by such distribution network configurations.

The combined network transformer market in the US and Canada likely reached/crossed the $100 Million level  in 2021. The bulk of the market (85-90%) is usually comprised of sales of 3p units.  This estimated market size  seems realistic in light of the annual unit replacement rate (based on a 35-year life expectancy) and moderate levels of net new shipments. We had excellent support from ARC Advisory, which firm partnered with us in undertaking this baseline study.

Next month, our posting will include excerpts from recent studies of distribution line sensors, trends in application of voltage regulation devices, electric vehicle adoption trends and a mid-range outlook for grid modernization programs

 – Chuck Newton

 

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Newton-Evans Research Company’s U.S. Market Overview Series Continues with Nine New Protection and Control Summaries

In the new 2022-2024 Protective Relay series, the authors have assessed the market estimates made by Newton-Evans in other recent reports, both multi-client and commissioned.  In this series we have made specific range estimates for four of the most widely used protective relays, including motor control relays, distribution feeder relays, line differential relays and generator relays.  We have grouped a number of substation relays together as one entity covering relays for busbar, transformers, capacitor bank, switchgear, breaker failure, and other types of transmission line protection relays.

In the recent mid-2022 series of market overviews covering substation automation topics, we estimated the total of digital protective relays shipped to U.S. utility and C&I customers in 2021 to have a value of more than $800 million. When the groupings reported here are summed, the total values of 2021 product shipments concur with the totals for digital relays as reported in the earlier substation automation series. The vast majority of protective relays used by utilities are digital, while solid state units are more frequently used in telecom and motor-related applications and in one-for-one replacement of some electro-mechanical relays.

In addition to digital protective relays, closely related report topics are evaluated in this new series.  Included are individual report summaries on electro-mechanical relays, synchrophasors, drop-in substation control houses, and teleprotection equipment.  In total, Newton-Evans estimates the value of 2021 factory shipments of products covered in this series totals more than $1.1 billion.

Commercial and industrial customers account for about one-third of our total estimate of spending across the nine topics covered in the series.  This significant percentage is primarily due to the large volume of motor protective relays shipments, with the majority of these shipments made to C&I customers rather than to electric utilities.  As more and more distributed energy resources come online with ownership primarily by non-utility entities, there will be more purchase of protection-related products, equipment and services made by C&I customers.  During the 2022-2030 years, Newton-Evans anticipates significantly higher levels of C&I procurements necessitated by the construction of non-utility owned substations, requiring outlays for a variety of protective relays, drop-in control houses and teleprotection equipment.  Interested readers can view the product offering here: https://www.newton-evans.com/product/overview-of-the-2022-2024-u-s-transmission-and-distribution-equipment-market-protective-relay-series/.   See the following chart containing two overviews of our findings.

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U.S. Substation Automation and Integration Market Expenditures Valued at $2.5 Billion in 2021

When the estimated sales of 14 product/service topics covered in the newly released 2022-2024 edition of U.S. Substation Automation Market Overview Series are totaled, the estimated value of these product/services purchased by American utilities and industrial substation sites reached $2.493 Billion in 2021. Equipment types reported in the series include RTUs, PLCs, protective relays, multifunction meters and recorders (digital fault recorders, sequence of events recorders, power quality recorders) reclosers, inter-utility revenue meters, automation platforms, time synchronization clocks, voltage regulators, communications equipment and integration services.

The total of spending on substation automation-related equipment and smart devices, along with substation integration services is on the rebound from COVID-era induced spending cutbacks. Newton-Evans Research expects investments in substation modernization to continue to grow over the next 24-36 months at a moderate rate of growth. As new substations come onto the grid to support renewable energy sites, these will be highly automated.

While automation budgets will remain a substantial portion of all substation-related budgets, additional investment is necessary to shore up grid resiliency and cyber and physical security defenses at the substation level and so these expenditures will share in the overall investment plans. The need for substation physical expansions and upratings will also continue to cause substations investments to rise.

Newton-Evans Research also finds that there are three distinct tiers of substation integration service providers. These include substation automation specialist firms, SCADA industry participants having substation devices and which also provide integration services and T&D engineering service firms having substation integration expertise.

Individual substation market overview reports are priced at $195.00 and the entire 14-report series is available for $1,150.00. Each market overview report includes a segment description, estimated market size, market shares for key participants and the U.S. market outlook through 2024.

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Estimated Value of Selected OT/IT Systems Shipments and License Fees by U.S. Electric Utilities Now Exceeds $3 billion.

The 2022-2024 edition of the Newton-Evans’ U.S. market overview series covering developments in 12 control and monitoring systems and related IT/OT applications topics is now available for ordering on the company’s website.

The series covers the following topics with individual 2-to-4-page report summaries.  The summaries are based on our studies with utilities and industry discussions held over the past three years.  The market segments covered in this year’s series include energy management systems (EMS), supervisory control and data acquisition (SCADA), geographic information systems (GIS), customer information systems (CIS), outage management systems (OMS), meter data management systems (MDMS), mobile workforce management systems (MWM), advanced distribution management systems and advanced distribution automation (ADMS/ADA), energy market management systems (EMMS), Cyber Security, generation management and distributed control systems (GMS/DCS) and distributed energy resources management systems (DERMS).

The total value of shipments/sales of these 12 systems and application software categories delivered primarily to U.S.-based electric utilities and C&I customers, is now estimated to be more than $3 billion annually.  Some major systems providers are active in a majority of these market segments, with industry segment specialists also key participants.

The C&I segment accounts for about $120-$150 million in procurements of these systems, as developed primarily for electric utilities.1   However, EMMS offerings are primarily oriented to ISO/RTO community, and DERMS solutions are regularly purchased by renewables aggregators, as are specialized SCADA offerings for wind and solar applications.

Some of the segments are oligopolistic, in that only a handful of suppliers are actively serving that particular market.  EMS and EMMS are two such examples.  Other segments are characterized by fragmented market shares held by many suppliers, as evidenced in cyber security, OMS and MDMS market segments.

Individual reports are priced at $195.00 and the entire 12-report series is available for $1,450.00.  Each market overview report includes a segment description, estimated market size, market shares for key participants and a market outlook through 2024.

  1. C&I firms spend additional billions of dollars on vertical industry-developed OT and IT systems such as factory-based SCADA and related automation systems and software.  Distributed control systems with appropriate industry-specific applications and functions is another prime example.  Today’s cyber security investments are also targeted in part to vertical market requirements, as are mobile workforce management systems.  CIS/CRM systems are also widely deployed in several segments within the C&I marketplace.
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A Look at the 2021 T&D Services Market in the United States

Over the past decade, the need for on-site T&D equipment servicing and parts replacement has grown, both for electric utilities and for commercial and industrial customers. While Newton-Evans has studied this portion of the T&D market in a cursory manner over the decades, we have not produced a multi-client study of this important segment of T&D-related spending. Even now, our definition of T&D services is not all-inclusive, as there is significant related expense incurred for equipment testing services (about $450 Million) and even more investment for replacement parts for ancillary equipment like structures, connectors, line tools, et al, accounting for multiple hundreds of millions of dollars.

While much of the cost of T&D equipment services and repairs is grouped as operating expense, we believe there may be some “replacement parts” costs that are likely classified as capital expenditures, especially costly parts for large power transformers and components for HV substation equipment.

The total value of expenditures for T&D equipment-related services and replacement parts in the United States is likely around the $4 Billion level as of 2021, and our estimate for global spending on T&D services is in the $18-20 billion range. These estimates exclude the costs of equipment unit replacement. Together, T&D equipment services, including repairs and replacement parts, accounted for perhaps $3.6 Billion to upwards of $4.2 Billion in 2021. See Figure 1.

Looking at T&D equipment field services, including repairs and maintenance services performed by third parties, our mid-point spending estimate is $1,750 Million. See Figure 2.

Similarly, the spending for replacement parts for HV, MV, LV equipment and for power and distribution transformers is estimated to be in the $2,200 Million range. See Figure 3.

The overall split of spending between utilities and the C&I community is about a four-to-one ratio in our view, with utilities accounting for the bulk of all HV, MV and transformer-related spending, but with the C&I group accounting for substantial portions of LV equipment services and replacement parts, some MV and transformer services, and occasional HV equipment servicing.

The largest portion of spending among the four categories studied for this article (HV, MV and LV equipment, and transformers of all sizes) is for MV equipment services and replacement parts. HV equipment services follow, then comes spending for power transformer services and LV equipment services.

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Outlook for Grid Modernization from IT and OT Perspectives: Recovering the Momentum Lost During COVID

Over the past two years, the pandemic has affected our lives, our businesses and the nation’s plans for infrastructure modernization, including the electric power grid. We had earlier (2020) forecasted rather robust growth in spending on IT, OT and smart grid initiatives in a grid modernization report prepared for a client organization.

During the first year of the pandemic, Newton-Evans conducted a small sample study (25 large and mid-size utilities) of the impact of COVID on electric power transmission and distribution capital investment projects.

Observations from that 2020 study indicated capital investment plans for some utilities had been scaled back by as much as 50% for 2020 and 2021. Other respondents reported that capital projects had been deferred for 12, 24 or even 36 months. A few utilities held fast to their pre-pandemic investment plans as long as they could do so.

In Figure 1, note our belief that total 2021 expenditures for the combination of IT, OT and smart grid projects likely reached about $14.2 Billion. In 2020, Newton-Evans had estimated that 2021 would likely see about $16.1 Billion in these combined expenditures, but by that year, the pandemic had firmly taken hold, restricting the availability of utility workforce personnel. COVID also impacted the manufacturing of some electrical equipment and provision of consulting and engineering services related to IT, OT and grid modernization projects.


Figure 1.
NOTE: Total IT + OT + SG Expenditures = $14.25 Billion
($5.55 Billion for IT + $5.30 Billion for OT + $3.4 Billion for “pure” Smart Grid)
$14.25 B = about 4.75% of electric utility operating revenue or 3.6% of total electricity sales.
IT spending alone likely less than 2% of operating revenue.

Now, the question arises – What is included in “pure” smart grid investment? Here, we include smart grid devices and equipment that acquire and transmit data and other signals to monitor and/or control utility field operations outside of the substation fence. For the most part, these are 21st century developments or generational improvements over earlier “legacy” devices. Pole top RTUs, distribution line fault indicators and feeder monitors, multiple types of controllers (for capacitor banks, automatic circuit reclosers, voltage regulators, line mounted monitoring devices et al) and automated switches and protective devices).

The related advanced communications infrastructure including built-out portions of the utility wide-area networks, local area networks and supporting infrastructure for automatic metering equipment are also placed in the “pure” smart grid bucket. IT system components related to smart grid are typified by meter data management systems, the customer services links to outage management systems, and geographic information systems to name a few. Operations side systems and applications would include advanced distribution management systems which collect and aggregate the thousands of field data points now configured with intelligent electronic field devices mentioned earlier that assist in more effective operation of the distribution grid.

By the third quarter of 2021, some recovery in capital spending for transmission and distribution was underway, based on recent discussions with a variety of industry sources. Even now, in the first quarter of 2022, we are still in a cautionary progression, given the lingering concerns over, and the effects of the OMICRON variant on the utility labor force and on delays in equipment availability in some situations. By 2023, I anticipate combined investment in IT, OT and grid modernization projects as shown in Figure 3 below will increase to more than $16.6 Billion. When compared with a pre-pandemic outlook calling for about $19.2 Billion in such investment in the coming year this leaves a shortfall of $2.6 Billion.

Importantly, when utilities have been compared with other industries related to IT spending, at first glance the industry appears to invest relatively less of its revenues in IT and OT. However, we have found that even in this pandemic area, with total U.S. electric power revenues approaching $400 Billion, the investment in combined IT and OT, plus related portions of grid modernization technology projects (exclusive of the cost of grid modernization equipment), the level of capital spending for grid modernization is closer to the 3.6% – 4.0% investment level. IT spending alone hovers around 1.5%-1.9% of operating revenues. Adding in the industry’s investment in OT and in key technology aspects of smart grid projects, the relative investment in overall information technology in total climbs to a much more reasonable level. See Figure 2.


Figure 2.
Two key assumptions about this outlook:
1. COVID will be endemic, not pandemic, by 3Q 2022.
2. Infrastructure Investment and Jobs Act actually begins funding significant portions of the $72.3 Billion allocated for energy and electric power infrastructure renewal by mid-year 2022.

The impact of COVID on electric power industry investment during 2020 and 2021 and into 2022 has taken its toll. The question facing the industry and the nation is whether or not this estimated $16.5 Billion shortfall in grid modernization investment (as postponed or deferred from initial estimates) can be made up during the remaining years of this decade? My belief is that the investment gap will be narrowing over the next 36 months, as shown in Figure 3 below, and the pre- and post-pandemic trendlines will indeed converge in the latter years of the 2020’s. Closing the investment gap will especially be likely – and may occur earlier than anticipated with help from DOE funding. Much will depend on federal funds flows from the recently enacted Infrastructure Investment and Jobs Act – legislation that will enable additional billions of dollars to be provided for grid modernization programs and related energy projects. At least several billion dollars of the $72 billion or so earmarked for electric power modernization will be applied to IT, OT and “pure” smart grid projects, although the majority of the total budget is earmarked for transmission grid expansion, overall grid hardening and integration of renewable energy sources.

I believe that this forthcoming federal investment in the nation’s electric power grid – coupled with the investments of the nation’s utilities, must include funding for research and development of advanced technical solutions for ever higher levels of cybersecurity and grid resilience.

As of February 2022, the nation’s electric utilities are re-starting or initiating a number of grid modernization projects and programs, deferred in part over the past 24 months.  This activity will help boost IT, OT and smart grid device/equipment expenditures this year and into 2023. Figure 4 illustrates the near-term growth estimate we have made for the IT, OT and smart grid field components of capital investment as the effects of the COVID pandemic begin to wane in the first quarter of 2022.

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Sizing the Market for Electric Power Grid Modernization In an Era of Pandemic

According to the U.S. Department of Energy’s Energy Information Administration, annual spending on electricity distribution systems by major U.S. utilities continued to increase year-over-year through 2019, with major utilities spending some $57.4 billion on electric distribution in that last pre-pandemic year. More than half of utility distribution spending in 2019 went toward capital investment ($31.4 billion) as utilities worked to replace, upgrade, and extend existing infrastructure. Another $14.6 billion was invested in operations and maintenance (O&M), and $11.5 billion was appropriated for customer expenses, which included advertising, billing, and customer service.

In 2019, much of the $31.4 billion distribution system capital investment (40%) was spent on power lines, both underground (23% of investment) and overhead (17% of investment). Distribution lines are added or expanded to accommodate new neighborhood development or higher electricity flows as sales increase.1
Keep in mind that when spending by municipal electric utilities and electric cooperatives are added to the EIA totals, the amounts reported by EIA actually would increase by about 25-30%, at least in our estimation.  The bulk of this additional non-IOU spending was for distribution expenditures.

We have increased these amounts for 2020 and 2021, if only to account for inflationary pressures on prices of electrical equipment and systems. Thus, our view is that, in 2021, about $60 Billion was spent in total, on electric power distribution activities in the United States. Of this amount, $33 Billion was estimated for capital investment, and about $20 Billion of the total went for distribution equipment and systems.


Fig. 1

Newton-Evans’ recent year studies of U.S. combined utility and industrial/commercial spending for dozens of specific T&D products, equipment types and systems suggest about $22 Billion was invested in about 70 specific T&D equipment types in 2021.2 Note that this estimate includes spending for both transmission and distribution. In fact, the total expenditures for T&D procurements likely exceeded 100 billion dollars. See Figure 2.


Fig. 2

This $22 Billion shown in the above chart excludes additional billions of dollars invested in power lines, underground cables, electric power poles, meters and ancillary equipment as well as customer-related spending, certain substation construction and O&M services.

One recent Newton-Evans’ study of capital investment changes brought on by the COVID pandemic, resulted in an expected drop in CAPEX from 2019 to 2020, followed by stabilization and a moderate increase in spending for some areas in 2021. Some respondents cited this as a “deferral” of investments rather than a cancellation of investments at the time of the study.3 Nonetheless, total capital investment by U.S. electric utilities during the 2020 and 2021 years likely centered around the $130 Billion mark.4

If the nation (and the entire world) can move on from the ongoing pandemic era, to an endemic period, grid modernization investment may recover some of the momentum lost or deferred from the past 24 months. As well, the significance of the passage of the Infrastructure Investment and Jobs Act in November, 2021, cannot be overstated. More than $60 Billion dollars of funding under this new act has been allocated to the energy sector, most of that amount earmarked for modernization of the electric grid.

Sources:
1. U.S. Department of Energy, Energy Information Administration
2. Newton-Evans’ Market Overview Series on various T&D Topics
3. Newton-Evans Research Study of Capital Investment among U.S. Utilities in Midst of Pandemic Conditions (1-2 Quarters, 2020)
4. Newton-Evans Calculations of 1.28 x EEI/EIA estimate of $107 B. Newton-Evans’ estimate very similar to estimate prepared by Statista, which itself was sourced in part from S&P Global Market data.

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GE-PROLEC + SPX Transformer Solutions (Waukesha) – A Rising Global Powerhouse for Power Transformers

With the early October 2021 completion of the GE-PROLEC acquisition of SPX Transformer Solutions, the transformer manufacturing industry is again itself transformed a bit.  With this acquisition the combined GE-PROLEC venture now takes on a  co-leadership position in the “low power, middle range and higher range segments” of the U.S. power transformer market.

SPX Transformer Solutions has been the U.S. market segment leader in the manufacture and sales of small power, medium power and large power transformers.  GE-PROLEC was already a third-place contender in the U.S. market for medium power transformers, shunt reactors and phase shifting transformers.  Historically, GE has been a dominant supplier of network transformers as well, and remains a segment co-leader.  Neither GE-PROLEC nor SPX Transformer Solutions has been a market leader in the provision of mobile transformers/substations, but other than that particular segment, the combined unit shipments and dollar values likely provides GE-PROLEC a market leading share of at least five segments of the power transformer business.  While GE-PROLEC is a “top five” participant in each of the three major categories of distribution transformers (overhead liquid units, dry transformers and pad mount units), the acquisition of SPX Transformer Solutions has no effect on their standing for distribution transformers.

Transformer Monitoring and Diagnostics:

GE historically has offered a wide range of solutions to monitor and manage critical assets on the electrical grid, detect and diagnose issues and provide expert information and services to customers. GE’s asset monitoring and diagnostics portfolio includes solutions for single- and multi-gas transformer DGA, enhanced transformer solutions and switchgear monitoring, as well as software and services.  GE was early into the transformer DGA monitoring business with its 1999 acquisition of the Montreal-based Syprotec organization.  The company’s efforts in transformer monitoring developments since then have made it a global leader in transformer health monitoring and diagnostics.

Waukesha’s transformer service business has been a mainstay for SPX in years during which equipment sales were flat or down, with the company’s service capabilities and offerings extended to provide service for non-Waukesha power transformers.

Revenue Estimates:

Newton-Evans estimates global revenues for the combined transformer equipment and services operations of the GE-PROLEC plus Waukesha (SPX Transformer Solutions) will exceed $1.5 Billion in 2021.  In the U.S. market, our 2020 estimate for GE transformer equipment sales in the U.S. market stands at $500-$550 million, and for Waukesha transformers our 2020 estimate of U.S. shipments is $300-$350 million out of a reported total of $427 Million in power transformer sales.

Combined GE-PROLEC and Waukesha transformer-related services and M&D device sales revenues in the U.S. are likely to reach $200 Million or more, with multiple regional service facilities operated by the combined business units.

Some History on GE’s Rise in the Power Transformer World Market

Back in 2014, during the time of GE’s acquisition of Alstom Grid, the latter firm was number three in the world in terms of large power transformer market share and assets, operating 13 plants with an annual production capacity of more than 130 MVA. GE Prolec was already a major North American market force with about a 14% share of the U.S. market.

At that same time in 2014, I had written the following: “Together, this alliance may become number three in the global market for large power transformers behind ABB and Siemens. To do so, the GE-Alstom combine will have to fend off HICO, Hyundai, Toshiba and MEPPI as well as three up-and-coming Chinese manufacturers.”  With additional non-organic revenue additions of nearly $500 Million achievable this year with combined reporting from Waukesha, GE-Prolec will indeed firm up its position as the third leading supplier of power transformers – no longer far behind Siemens Energy and Hitachi-ABB Power Grids.

 Sources: 

(1) Newton-Evans Research Company’s 2021-2023 edition of Market Overview Reports:  Transformer Series-Complete Set

(2) 2020 Annual Report for SPX Corporation.

(3) 2020 Annual Report for General Electric Corporation.

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Newton-Evans Research Releases 2021-2023 Edition of Nine Market Snapshot Reports on Distribution Automation Topics Covering the Electric Power Industry in the United States.

Newton-Evans Research Releases 2021-2023 Edition of Nine Market Snapshot Reports on Distribution Automation Topics Covering the Electric Power Industry in the United States.

U.S. Sales of Distribution Automation Components estimated at more than $1.9 Billion in 2020, Forecast to Increase to $2.3 Billion by 2023.

August 30, 2021.  Ellicott City, Maryland.  The Newton-Evans Research Company has announced its latest publication of a set of 9 U.S. distribution automation market two-to-four-page summaries.  The new series of market overview reports (executive market summaries) includes supplier listings, representative products, and estimated market segment size, vendor market share estimates and market outlook through 2023.   Electric utilities accounted for about 92% of all purchases of distribution automation related goods and services.

A majority of distribution automation equipment purchased by American utilities and industrial firms is produced or assembled in the United States.   U.S. sales of DA components including equipment smart controllers, DA applications software licensing, dedicated communications infrastructure and DA-related engineering services, is expected to exceed $2 Billion in 2021.  Another several hundred million dollars will be spent again this year for “DA-related infrastructure equipment” including reclosers, MV voltage regulators and MV capacitors.

The Distribution Automation series ($975.00) includes U.S. 2020 market size, market share estimates and 2021-2023 market outlook for these product and service categories:

  • DA01 – Automatic Circuit Recloser Controls
  • DA02 – DA/DMS System Components (including distribution network analysis; distribution network condition monitoring and fault location and characterization)
  • DA03 – Voltage Regulator Controls
  • DA04 – Capacitor Bank Controllers
  • DA05 – Fault Indicators (covering both fault current indicators and faulted circuit indicators)
  • DA06 – Pole Top RTUs
  • DA07 – Line Mounted Monitoring Devices
  • DA08 – Communications Components for DA (covering PLC/DLC; cellular and 900Mhz)
  • DA09 – Engineering Services for Distribution Automation Projects (covering consulting engineering services, related services provided by manufacturers; DA services provided by smart grid consulting specialists)

Importantly, in the chart below, note the pivotal role played by communications networks developed specifically for distribution automation applications being implemented by utilities across the nation.  The market overview (DA08) further allocates DA communications spending estimates by three external service types: (BPL/PLC/DLC), Cellular and 900 MHz MAS.

Three related T&D market series have been published over the past several weeks by Newton-Evans. These include: Power and Distribution Transformers (14 summaries); High Voltage Equipment (15 summaries) and Medium Voltage Equipment (17 summaries).

Further information on each of the four updated T&D market overview series, and three series not yet updated from 2018, comprise more than 85 individual U.S. electric power industry market summaries.  The market overviews both series and individual reports, are available from Newton-Evans Research Company, P.O. Box 6512, Ellicott City, Maryland 21042.  Visit the reports page for a sample and to order reports online. Phone: 410-465-7316 or visit www.newton-evans.com for a brochure or to order any of the related report series or any of the more than 85 individual report summaries online.  Chuck Newton can be reached at cnewton@newton-evans.com.

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SCADA Systems for the Renewables Energy Industry and ADMS For Utilities

Introduction:

Newton-Evans believes that there is significant opportunity for providers of SCADA-related systems and application software to help manage the operations of commercial and utility-scale wind and solar power resources.

The U.S. Department of the Interior’s USGS agency reports that there are about 67,000 large (utility-scale) wind turbines in operation in the United States.  These thousands of wind turbines are installed at about 1,500 sites or farms.  The country is adding about 3,000 utility-scale wind turbines each year. (!)

According to the U.S. Department of Energy’s EIA (Energy Information Administration), there are more than 2,500 utility scale solar plants/farms now operating in the United States.  Most of these facilities represent from 1 to 5 megawatts of generation capacity. (2)  There have been a number of larger solar plants coming onstream in the last five years.

Each of these 4,000-plus utility-scale renewables sites now operational in the U.S. requires a SCADA-like system to acquire operating information and to coordinate grid planning activities.  For enterprises operating multiple facilities, capabilities exist to coordinate multiple SCADA installations (or site automation/control systems) under the control of a larger company-wide or utility-wide SCADA system.

Wind Power SCADA

There are four types of SCADA providers serving the wind power industry as shown here:

 

 

 

The first group of wind SCADA offerings is comprised of the leading wind turbine manufacturers for the U.S market, including GE, Siemens and Vestas, (collectively representing about three-quarters of US wind turbine sales) and supplemented with some Chinese manufacturer installations and supporting control systems software from either Goldwind or Envision, both of which have a U.S. presence and have current installations around the country.

The SCADA applications developed by each turbine manufacturer center around wind turbine controls, but the offerings also extend to include a bevy of related monitoring and control applications for commercial wind farms.  The SCADA offerings from these firms appear to be designed with current generation software platforms and incorporate some useful apps development tools – an optimal solution for those sites that make use of wind turbines from a single manufacturer.

The second group of wind SCADA offerings is provided by a number of wind technology specialist firms, including DEIF, Grantek, Halus and SCADASolutions.  Offerings from these firms enable wind farm operators having wind turbines acquired from multiple suppliers to work in an integrated manner, analogous to a substation automation system that has to coordinate among multiple protective relay suppliers.  Status reporting, turbine condition assessment, activity controls can be accomplished by the SCADA offerings from these suppliers, regardless of the turbine type, size or manufacturer.

The third group of wind SCADA offerings comes from “generalist” SCADA suppliers, those companies that provide packages or configurable SCADA to multiple industries, from energy utilities to process industries, to discrete product manufacturers and commercial building control systems.  Products from leading suppliers including PcVue, Iconics, Wonderware (Aveva) and others have all been successfully applied to numerous wind farms in the U.S. and elsewhere.

The fourth group of offerings that have made some inroads with utility-operated wind farms is provided by the “traditional” suppliers of electric utility SCADA, DMS and energy management systems.  Most of these firms have now developed requisite software or have partnered for development of wind energy applications, and have likely implemented wind applications for one or more utility customers at this point in time.  Included here are large companies such as ABB and Schneider, as well as key suppliers to the mid-size utility market and include firms as ACS-Indra, OSI, QEI, Survalent and others.

Solar Energy SCADA

The more than 2,500 utility-scale solar farms operating in the U.S. also have a requirement for SCADA systems.  Similar to the groupings of SCADA providers in the wind sector, there are four major types of solar SCADA offerings for the U.S. market.

There are at least five solar SCADA specialist firms operating in the U.S. market in 2021 having currently installed solar SCADA systems, and there are likely additional firms operating on a regional basis around the country.  These firms primarily serve commercial solar energy facility operators.

Distribution utility SCADA providers have also developed several solar and DERMS applications of interest to their utility customers operating solar facilities.  If not solar applications specialists themselves, the utility SCADA/DMS systems can partner with or link with offerings from solar IT/OT specialists

The third group of solar SCADA providers is comprised of: a) large firms that have traditionally provided distributed control systems for electricity generation plants; and b) the multinational firm providing large-scale EMS/SCADA/ADMS systems.

Generalist SCADA suppliers that were listed earlier for the wind farm sector of renewables are also actively participating in the solar market as well.

The Utility Role in Aggregating Non-Utility Renewables (Utility-Scale Distributed Energy Resources)

Recently, the NREL reported that “Although 23 utility-led efforts exploring DER aggregation were launched in the United States by late 2018, DERMS remains in the nascent stages of implementation, with many utilities still in the process of exploring or piloting the range of available commercial solutions.” .(3)

Newton-Evans Research had earlier estimated that the U.S. utility DERMS market in 2020 had reached about $75 million and is likely to double to $150 million by 2024. (4)

Control is the Key

Importantly, the less control over renewable energy resources that the utility industry has (at both the transmission and distribution levels) the more tightly coupled and securely linked must be the control systems with which the utility can best manage operations to ensure grid stability.  This is why there is a separation between SCADA at the distributed energy resource site level which must be in place for operational data acquisition and is the rationale for the utility to have an up-to-date GIS providing DER locational data, supplemented by weather information as part of (or available to) it own DERMS and/or available to (or co-resident with) the DER site(s).

The prosumer-aggregator category of DER supplier adds yet another dimension lending additional urgency to the need for a comprehensive and scalable DERMS designed specifically for utility use.  While the author has read about the need for DERMS at the renewable facility level, the real need at these thousands of sites is for a SCADA-type system that can summarize information for the asset owner/operator and transmit requisite information securely to the utility entity (transmission or distribution-level) to enable the utility to optimize grid operations.  Multi-site renewables facilities will need their own large system to manage all assets regardless of location.  A fine example of a multi-site (on a nationwide scale) renewables SCADA system and national control center) is that of Iberdrola. (5)

What seems clear at this time is that the inclusion of renewables owned by aggregators (commercial and community levels) as electric power generation resources adds significant complexity to the already sophisticated nature of utility-operated transmission and distribution grids.  A quarter century ago, most power generation assets were under the direct control of utilities.  That is no longer the situation with an ever-increasing portion of power generation coming from renewables, and with a high percentage of renewables sites not owned or operated directly by regulated utilities.

In turn, a smooth-running grid will require ever-closer systems and telecommunications collaboration among T&D utilities, ISOs/RTOs, aggregators and regulators.  Disparate systems will have to be linked to some degree, with secure and reliable communications becoming absolutely vital to the safe, secure and reliable operation of the country’s power grids.  It will be incumbent on utilities to manage these complex relationships with all the technical resources available, because after all is said and done, it is the nation’s electric utilities that are charged with the operation of the grid on local and regional levels.

The increasing complexity of today’s grid architecture and the challenges posed to IT/OT staffs to develop comprehensive systems that can meet current and likely regulatory requirements to safely and securely accommodate commercially-owned power generation assets is among the greatest challenges found in any sector of the nation’s industrial, commercial, government sectors.  The need is paramount for a new generation of ADMS, AEMS, DERMS, SCADA/DCS. GIS and DRMS that are each based on open standards, configurable, scalable and capable of providing two-way telecommunications pathing.

Here is one view of how renewables SCADA systems are playing and will continue to play an important role in enabling utility-level coordination among aggregators at the commercial and community levels, and aligned with regional requirements of ISO/RTO organizations.

 

 

  1. Source: https://www.usgs.gov/faqs/how-often-us-wind-turbine-database-updated?qt-news_science_products=0#qt-news_science_products
  2. Source : https://www.eia.gov/todayinenergy/detail.php?id=38272
  3. National Renewable Energy Laboratory (Washington, D.C.)  Expanding PV Value: Lessons learned from Utility-led Distributed Energy Resource Aggregation in the United States, https://www.nrel.gov/docs/fy19osti/71984.pdf.
  4. Note that the Newton-Evans’ growth estimate, though moderately strong, is in fact lower than that of other energy research and consulting firms having a focus on DERs and DERMS.
  5. IberdrolaNational Control Center: the most advanced renewable energy control center in the United States. https://www.iberdrola.com/innovation/core-renewable-energy-operation-center-usa

 

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Newton-Evans Research Publishes 15 Market Snapshot Reports on High Voltage Power Equipment and Transmission Substations

March 22, 2021.  Ellicott City, Maryland.  The Newton-Evans Research Company has announced publication of a set of 15 U.S. high voltage equipment and substation market two-to-four-page summaries.  The new series of market overview reports (executive market summaries) includes supplier listings, representative products, and estimated market size for each topic, including vendor market share estimates and market outlook through 2023.   Electric utilities accounted for about 86% of HV-related equipment and transmission substation spending overall.

  • Commercial and industrial end-users accounted for more than $300 Million on substation construction projects in 2020, according to Newton-Evans’ estimates. Much of this amount was for construction of renewable energy gathering substations.
  • Substation construction represents the largest single investment area among all bulk power system components.
  • HV gas-insulated substations and gas-insulated switchgear represent a growing segment of bulk power-related investments. Growth is likely to accelerate once non-SF6 gas alternatives are more widely available for higher voltage equipment.
  • NERC projections suggest that as many as 14,000 HV line miles will be constructed over the 2021-2030 period. Importantly, more than one half of the expected expansion will be at 200kV or higher.  This will mean a need for about 250-300 new/up-rated transmission substations.
  • IOUs, G&Ts and federal agencies were most closely identified as having HV substation construction plans. Distribution cooperatives, municipal operations and industrial sites were more likely to plan MV substation construction projects.  Following is a look at identified transmission projects.

 

 

 

 

 

 

 

  • HV circuit breaker shipments likely exceeded $900 Million in 2020, with more than one half of the total investment made for 69kV-200kV range of breakers.

 

 

 

 

 

 

Further information on the 2021-2023 series of U.S. High Voltage Equipment market overviews is available on the Newton-Evans Research Company website:  https://www.newton-evans.com/our-reports/ for a brochure or to place an order for this new series or many other available T&D-related market reports.  This series is available via online purchase and immediate download.  Individual HV topical reports are priced at $150 per report, and the entire 15-report series is priced at $1,250.00.  Newton-Evans Research Company, P.O. Box 6512, Ellicott City, Maryland 21042. Phone: 410-465-7316.

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Estimated U.S. Sales of Power and Distribution Transformers and Related Services Accounted for $4.8 Billion in 2020, Forecast to Increase to $5.0 Billion by 2023.

Newton-Evans Research Publishes 14 Market Snapshot Reports on the Power and Distribution Transformer Industry in the United States.

February 1, 2021.  Ellicott City, Maryland.  The Newton-Evans Research Company has announced publication of a set of 14 U.S. transformer market two-to-four-page summaries.  The new series of market overview reports (executive market summaries) includes supplier listings, representative products, and estimated market size for each topic, vendor market share estimates and market outlook through 2023.   Electric utilities accounted for about 81% of purchases of power transformers and 75% of distribution transformers.  Commercial and industrial end-users accounted for the lion’s share of the dry-type transformer and special purpose transformer markets.

More small-power-to-very-large power transformers now are being manufactured in the U.S. recently, thanks to two key factors including: (1) the U.S. siting of large power transformer production facilities by several manufacturers over the past decade and (2) the mid-year 2020 Executive Order on Securing the United States Bulk Power System (though that EO is currently on hold/under review for 90 days).

The Newton-Evans Power Transformer Market Overview series ($1,250.00) includes U.S. market size, market share estimates and market outlook for these 14 transformer-related product and service categories:  TX01 – Mobile Transformers;  TX02 – Small Power Transformers;  TX03 – Medium Power Transformers;  TX04 – Large Power Transformers;  TX05 – Very Large Power Transformers;  TX06 – Shunt Reactors;  TX07 – Special Transformers (Arc, Furnace);  TX08 – Distribution Transformers (OH, Oil, 5kva+);  TX09 – Distribution Transformers (Dry Type);  TX10 – Distribution Transformers (Pad Mounted);  TX11 – Network Transformers;  TX12- Phase Shifting Transformers; TX13 – Transformer Life Management Services; and  TX14 – Transformer Monitoring & Diagnostics Equipment and Services.

Further information on the 2021-2023 series of U.S. electric power transformer market overview series is available  on the Newton-Evans Research Company website:  https://www.newton-evans.com/our-reports/ for a brochure or to place an order for this new series or many other available T&D related market reports.  This series is only available via online purchase and immediate download.  Individual transformer topical reports are priced at $150 per report, and the entire 14-report series is priced at $1,250.00.  Newton-Evans Research Company, P.O. Box 6512, Ellicott City, Maryland 21042. Phone: 410-465-7316.

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