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Utility CAPEX Report Published from the January 2010 Newton-Evans Study of Electric Power T&D Investment

Tracking Study Finds Increased 2010 CAPEX and O&M Budgets for Smart Grid-Related Automation and Transmission Categories

February 25, 2010 —Ellicott City, Maryland. The Newton-Evans Research Company today announced the publication of its third study in the multi-year tracking research program looking into electric power utility CAPEX budgets related to smart grid investments and infrastructure spending plans.
Findings from the January 2010 Newton-Evans global tracking study of electric power transmission and distribution investment are somewhat positive, compared with the two earlier tracking studies conducted in 2008 and 2009. Each of five “smart grid” component areas, plus transmission and distribution infrastructure development, has been reported by utilities located in more than 25 countries to more likely be either “increased” or “unchanged” rather than “decreased” from June of last year. The highest percentages of officials reporting increases were in the areas of protection and control, and transmission infrastructure CAPEX budgets. Continue reading Utility CAPEX Report Published from the January 2010 Newton-Evans Study of Electric Power T&D Investment

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Off to a Fast Start: Newton-Evans tackles 2010’s initial array of assignments

With a warm welcome to our newest report clients from China, United Arab Emirates, Czech Republic, and Japan, along with assignments from several of our long-term North American and European clients, Newton-Evans staff is keeping up with the workload despite two record blizzards affecting day-to-day life and work in the mid-Atlantic region of the U.S. over the past week.

Our client-focused research activities over the first six weeks of 2010 have included topics ranging from distribution automation, to DMS, an update on demand response, plans for substation automation, a review of apparatus monitoring and diagnostics, to a synopsis of legacy electric utility application software market size and shares.  In addition, the company is focused on two multi-client studies:  First, the newest round of CAPEX studies, with participation and assistance now obtained from utility officials in more than 25 countries. Secondly, a new study of transmission planning in the USA and Canada will soon be available.

Some interesting electric power marketplace facts uncovered during the early weeks of 2010 include:

  • Size of the global installed base of large power transformers
  • Number of large power plants in countries around the world – to accompany our country-specific substation counts
  • Extent of Industrial power delivery micro-grids
  • Extent of intelligent electronic devices being deployed for distribution network automation.

Continue reading Off to a Fast Start: Newton-Evans tackles 2010’s initial array of assignments

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Areva T&D Apparently To Remain in French Hands After All

After months of internal debate and consideration of proposals from GE and Toshiba, Areva’s top tier of executives have decided to keep the $7 billion-plus T&D business under French control. AREVA’s Supervisory Board met on November 30, 2009 to examine the bids. After review, the Supervisory Board asked the Executive Board to begin exclusive negotiations with Alstom/Schneider.

The consortium offered 2.29 billion Euros in equity value, i.e. 4.09 billion Euros in enterprise value. The bid does not include any requirement for a seller’s warranty but includes a buyer’s commitment to maintain all European sites for a 3-year period.

To ensure that all AREVA T&D team members are integrated properly, Alstom/Schneider have also agreed to offer to all European employees a similar position in the same geographic area, at an equivalent qualification level and without loss of compensation or seniority.

Finally, unless the economic environment deteriorates significantly, the buyers made a commitment not to implement any layoff program except for voluntary terminations. There are still many unresolved issues including these: Continue reading Areva T&D Apparently To Remain in French Hands After All

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Potential Synergies of an Areva T&D Acquisition by General Electric: Why Alstom-Schneider and Toshiba are Also in the Bidding

As many regular readers of Newton-Evans’ reports already know, there are three major contenders for the $7 billion Transmission and Distribution business units of Areva Corporation. These are the American firm General Electric, the French corporate combination of Alstom and Schneider Electric, and the Japanese company, Toshiba.

Newton-Evans Research believes the greatest benefit to the electric power industry may result if General Electric’s offer becomes the winning bid. The reason: Areva T&D fills several product/equipment gaps in GE’s T&D product line and related automation offerings. A successful acquisition by General Electric would provide the firm with world-leading combined market shares in substation automation, protection and control and T&D control systems (energy management and SCADA). GE would become a major player in several growing portions of the transmission equipment business, establishing a stronger foothold in the North American and international transmission market segments described below. Together these segments are worth $25-40 billion on a worldwide basis. Areva T&D earned about $3.5 billion in HV equipment sales in 2008-2009. Continue reading Potential Synergies of an Areva T&D Acquisition by General Electric: Why Alstom-Schneider and Toshiba are Also in the Bidding

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Critical Issues In Protective Relaying: Engineering Perspectives From 24 Countries

The newest study of electric power grid protection and control, published by Newton-Evans Research on October 30, 2009 is now available for on-line purchase. The 81 page report is based on extensive surveys of protection and control engineers and P&C management from around the world. The survey was designed by engineers to include study of key topics of interest to the P&C community. Issues covered in the study  include equipment/device issues; tripping and control practices, settings and analysis, testing frequencies and methods.

One theme that emerges from the varying responses is that there is no particular “right” way or “wrong” way to go about designing and implementing a particular relay scheme. Some utilities design schemes in a certain way, while others do it another way. What our project manager labels “Philosophy of Engineering” is evident in this study, especially in the choices made by P&C engineers as they apply relays to their systems.

This report includes more respondent comments than any previous relay survey conducted by Newton-Evans. We encourage you to read through these list compilations, as there is a wealth of information contained therein. What is a major issue for one engineer is not even a concern for another engineer.

As one example of utility diversity, it is fascinating to see in Section D: Strategy/Policy Issues the variety of ways Utilities are structured to handle the responsibilities of their Relay Organization, as well as to review the tactics used to attract and retain the next generation of relay engineers. Some Utilities have extensive training programs for young talent, while many do nothing or do not even recognize it as a potential problem. Continue reading Critical Issues In Protective Relaying: Engineering Perspectives From 24 Countries

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Newton-Evans Role in Recent SMARTENERGY East Coast Conference

Chuck Newton moderated  a well-received session on Demand Side Management and Energy Efficiency Technologies for this New York City conference held on October 27th and 28th. The conference was hosted by the Spintelligent Company, publisher of Metering International.

The panel members for this session included Ron Zimmer, CEO of Ottawa-based CABA – the Continental Automated Buildings Association, Bill Scheffler, Director of North American Sales and Business Development for Sigma Designs, parent of  Z-Wave Alliance in California, and Margaret Jolly, Manager of Distributed Generation Programs for Consolidated Edison in New York City.  Ron Zimmer’s talk focused on understanding the evloution of the connected home market.  Bill Scheffler discussed how we can take energy management beyond the meter.  Margaret Jolly gave a presentation on ConEdison’s very strong DG initiatives.  The audience of about 110 officials from utilities, consulting firms, smart grid services providers and regulatory bodies posed several questions to the speakers and good give-and-take discussions ensued.

For more information visit www.smartgridcareers.com or www.spintelligent-events.com.

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Thinking Smart: The Outlook for Spending on Smart Grid Technologies in 2009 and Beyond

An article by Newton-Evans CEO Charles Newton titled Thinking Smart: The Outlook for Spending on Smart Grid Technologies in 2009 and Beyond was recently featured in Volume 9 of the Energy and Utilities Project magazine, an mThink publication sponsored by IBM. The majority of the article summarized the spending outlook for eight major components of the smart grid: control systems, smart grid applications, substation automation programs, substation IEDs and devices, AMI/AMR, protection and control, distribution network automation, and telecommunications infrastructure. Additionally, Mr. Newton provided a general picture of the types of initiatives that need to be taken by individual utilities on a case by case basis to put smart grid technology to work for them:

“I have often compared the evolution of the smart grid to the iterative process of building the international space station: a long term strategy, a flexible planning environment, responsive changes incorporated into the plan as technology develops and matures, properly phased.What function we might need is that of a skilled smart grid architect to oversee the increasingly complex duties of an effective systems planning unit within the utility organization.”

To obtain a copy of The Energy and Utilities Project 2009 visit www.UtilitiesProject.com and sign up for online membership.

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Newton-Evans Cited in Automation World Article

Newton-Evans was cited in an Automation World article titled, “Smart Grid Stimulus Funds to Provide Market Boost.” Chuck Newton was quoted as saying:

“The Smart Grid eventually will be built out. But utilities never rush into anything, for the simple reason that they’ve got to keep the lights on. They can’t take it out of service to rebuild it. So it’s got to be an iterative process, and that usually means multi-year efforts.”

Read the full article on the Automation World website.

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Available Reports & Current Survey Efforts

In addition to our most recently completed studies on Protective Relays and Smart Grid Capital Expenditures (samples of which are available on our Reports page) Newton-Evans Research is currently inviting electric utility officials involved with protective relays to participate in our “Back Page” relay study. After completing a study of the Worldwide Protective Relay Marketplace, a supplementary questionnaire consisting largely of questions asked by utility officials to utility officials has been designed to answer questions that fall into these categories: Equipment/Device related, Tripping/Control related, Settings/Analysis related, Strategy/Policy related, Testing/Maintenance related, Vendor/Manufacturer related, Distributed Generation related, and Generation related questions.

The mix of yes/no and short answer questions on the survey include:

What criteria do you use for replacing older electromechanical and solid state relays?

Does your utility use a redundant bay control unit?

Do you use communication processors to consolidate relay communications for SCADA?

How do you manage digital relay firmware upgrades for installed relays?

What strategy do you follow for improving the reliability and security of busbar protection?

Given the global dearth of power system engineers, please describe what your utility is doing to attract, develop, and train new relay and protection engineers?

your Utility use process based or condition based maintenance for your protection system?

Do you include transformer sudden pressure relays in your normal testing cycles?

Do you use localized data gathering at substations with automated logic to operate local station equipment?

What strategy do you use to overcome the problems created by the mixture of vendors, tools, generations, and interfaces?

Participating electric utilities will receive the summary findings from this study as a “thank you” from Newton-Evans.

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Electric Power Utilities Continue to “Stay the Course” with Projected Capital Spending Plans for Smart Grid Building Blocks

Some Key Project Deferrals Noted in Transmission and Distribution Infrastructure . . . Rebound Anticipated by mid-2010 for Transmission . . . Later into 2011 for Distribution Infrastructure

The views of 118 Officials from Electric Power Utilities in 36 Countries Grow Somewhat More Conservative Since December but Remain Upbeat for Continued Investment in “Smart-Grid” Components

Ellicott City, Maryland – 9 July, 2009. In spite of the weakened economic conditions in countries around the world, electric power utilities continue to make significant financial commitments in “smart grid” building blocks and related automation programs. The majority of the large public and private utilities participating in the June 2009 Newton-Evans study are poised to continue many of their long-term capital investment programs as had been originally planned back in January of 2008. However, in several instances, the projects have been deferred from their initial planned start-up dates.

In a new tracking study released today by the Newton-Evans Research Company, a significant majority of the 118 electric power grid officials from 36 countries participating in the CAPEX and O&M budget planning study indicated that capital spending for control systems, substation automation, smart grid-related programs, and advanced metering rollouts are largely on track albeit with some pushback in timing. However, several planned investments for transmission and distribution grid infrastructure components have been deferred for this year, but are expected to rebound perhaps as early as the fourth quarter of 2010.

Continue reading Electric Power Utilities Continue to “Stay the Course” with Projected Capital Spending Plans for Smart Grid Building Blocks

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Mid-2009 Global Protective Relay Market Study Completed – Four Volume Study Released

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

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

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

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

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

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

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

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Volume One of 2009-2011 World Study of Protective Relay Use and Plans Just Released

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

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POWERGRID Europe 2009


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

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A Good Day in D.C. – The 2009 Annual Energy Conference

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

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

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

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Market Trends Digest

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

Click image to open .pdf in a new window.

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Where T&D Automation Is Headed: 2009 and Beyond

by Charles Newton

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

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

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Transmission Summit 2009

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

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

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Leveraging SCADA for the Smart Grid

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

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

Visit their website to get a free subscription.

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Protective Relay Marketplace – Our 7th Worldwide Study Now Underway

Newton Evans Research Company is embarking upon its 7th worldwide study of the protective relay marketplace. The 2009 survey has been co-designed by Newton-Evans’ staff, major electric utilities and leading suppliers and has been extensively reviewed and pre-tested.  Global fieldwork is now underway with participation from the world’s leading protection and control community within the electric power delivery industry expected to exceed 100 major participants.  The 4 volume report series is currently anticipated to be available in April 2009.

Please see our new brochure on this topic (.pdf) here:
relay_brochure2009.pdf