Show Me The Money - Where is the Smart Grid ROI?

Energy Analytics can provide the killer apps the smart grid needs to demonstrate measurable value.  Energy companies have to find ways to extract value from the enormous amount of data captured by smart grid technologies. This data deluge - the so called "Data Tsunami" - created by AMI and smart grid investments has created a growing demand for software and packaged analytic applications designed and preconfigured for the specific needs of the energy industry. A growing number of Energy Analytics companies are beginning to emerge with applications designed to help energy companies extract value from the reams of granular data captured by smart grid technologies.

Energy Analytics is quickly gaining interests from energy companies, IT companies, investors and industry organizations such as, Energy Central. In Q4 of 2011, Energy Central created a new practice called the Utility Analytics Institute. Their first publication, the Annual Market Outlook and Forecast Summary Report, projects energy analytics spending to reach $2B per year by 2016 . It is important to point out that the projected spending below is separate and apart from projected smart grid spending budgets.

The ROI is in the data! But which Energy Analytics apps will extract the most value? Contrary to the opinion of some, downstream applications that can talk to my washer and dryer aren't the killer apps that will justify building out the smart grid. The greatest value for Energy Analytics will be realized in upstream applications that improve sytem perfomance, scheduling accuracy and asset management and optimzation. These are the Energy Analytics apps that will improve grids efficiency and reliablity and demonstrate the greatest ROI.