Brazil Smart Grid: Market Forecast ( )

Transcription

1 Volume II: September 2012 northeast group, llc Brazil Smart Grid: Market Forecast ( ) Smart metering (AMI) Distribution automation Wide area measurement Home energy management September group.com

2 Brazil Smart Grid: Market Forecast ( ) Volume II Northeast Group has published the second volume of its Brazil Smart Grid: Market Forecast ( ) following the recent changes to Brazil s smart metering regulatory framework announced in August In particular, this volume updates the smart metering (AMI) and home energy management (HEM) market forecasts, analysis of the country s regulatory framework, and information on the role and prospects of leading vendors given a wave of recent merger and acquisition activity. Brazil is already one of the leading emerging market countries in terms of smart grid development. With the fifth largest population in the world and a government that is eager to modernize the country s infrastructure, Brazil will become one of the largest smart grid markets in the world by the end of the decade. Brazil s smart grid development is the product of strong underlying market conditions and positive government action. Like many emerging market countries, Brazil has high rates of non- technical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distribution losses, implying that utilities will reap immediate revenue protection benefits through smart meter deployments. Brazil also has a rapidly growing economy, which is beginning to strain existing infrastructure. As the country continues to grow, the reliability and energy savings benefits of smart grid will become increasingly important.

3 The Brazilian government has taken notice and in 2009 it set a non- binding target of replacing all 63 million existing electromechanical meters with smart meters by However, in August 2012, the government announced an opt- in smart meter regulation for existing customers, paired with a mandate requiring smart meters for all new customers. This was not the anticipated market catalyst for those expecting a binding mandate to replace all 63 million existing legacy meters with smart meters. As a result, Northeast Group is currently forecasting that Brazil will not reach its initial 63 million smart meter target. Yet, some government officials and regulators are still optimistic that the initial goal can be achieved, which may inspire future incentive structures and more favorable smart metering regulations. With strong underlying economic and political conditions, it is inevitable that Brazil s smart grid market will grow significantly in the coming decade. The question is simply how fast deployments will take place. Through a combination of new meter installations, smart meters targeted at reducing non- technical losses, and customers eager to take advantage of advanced smart grid applications, more than half of Brazilian homes will have smart meters by the end of the decade. However, the August 2012 regulations fell short of the concrete mandate needed for Brazil to meet it s original goal of 63 million meters by Nonetheless, Brazil remains a very significant smart grid market for both vendors and customers alike. Key questions answered in this report: How will new regulations affect near- term smart meter deployments? How large will the smart grid market including 14 segments become over the next decade? Which international vendors are already active in Brazil, which have won recent contracts and which have been engaged in M&A activity? Which domestic vendors are poised to partner with international firms to exploit the growing smart grid market? How will Brazilian utilities build their smart meter business cases? Which utilities have already developed pilot projects and which technologies are they using? Where in Brazil are distribution automation and home energy management already advanced?

4 Table of Contents i. Executive Summary 1 i.i Updates in Volume II of this report 3 ii. Methodology Introduction Brazil smart grid snapshot Current situation Regional comparison Electricity industry structure Smart metering regulatory framework Market drivers and barriers Smart grid market forecast Changes from the Volume I forecast Deployment start date and pace Cost estimates Alternative scenario Detailed smart grid market forecast and technology outlook AMI Meter hardware Communications options IT: meter data management and customer information systems Professional services Installation costs Prepaid metering Wide area measurement Distribution automation Overview of DA in Brazil Distribution automation components Substation automation and monitoring FDIR Volt/VAR optimization Grid monitoring and control Distribution automation activity in Brazil Home energy management Home area networks Distributed generation: solar inverters with communication capability Electric vehicle supply equipment Utilities AES Iberdrola CPFL Light Cemig Endesa Copel Rede Energia EDP 99

5 5.2 Eletrobras Celesc Cemar Vendor activity Domestic vendors International vendors International vendors in AMI projects International vendors in distribution automation projects International vendors poised to expand in Brazil Conclusion Appendix Domestic electricity sector vendors in Brazil List of companies mentioned in this report List of acronyms 126 List of Figures, Boxes, and Tables Updated vs. original smart grid forecast 4 Brazil smart grid: key takeaways 6 Brazil smart grid: leading indicators 7 Smart grid development at Brazilian utilities 8 Updated Brazil smart grid forecast data 9 Updated combined smart grid forecast 9 Figure 1.1: Smart grid value chain 13 Figure 1.2: Projected wind generation in Brazil 14 Figure 1.3: Smart grid model highlighting focus in Brazil 15 Table 1.1: Benefits of AMI in Brazil 16 Table 1.2: Demand response options 19 Figure 1.4: Solar and wind resources in Brazil 20 Table 2.1: Classification of meters by type 21 Table 2.2: Functionalities of electronic meters 22 Figure 2.1: Emerging markets smart meter potential 23 Figure 2.2: Current smart meter penetration rates in Latin America 24 Figure 2.3: Per- capita electricity consumption in emerging markets 25 Figure 2.4: Average residential consumption in Brazil 25 Figure 2.5: Global per- capita CO2 emissions 26 Figure 2.6: Actual and forecasted GDP growth in Latin America 26 Box 2.1: Smart grid throughout Latin America 27 Figure 2.7: Global residential electricity prices 28 Figure 2.8: Electricity generation mix in Brazil 29 Figure 2.9: Contracted and forecasted new generation 29

6 Figure 2.10: Utility ownership in Brazil 30 Box 2.2: Brazil political situation the Dilma effect 31 Figure 2.11: Electricity regulatory structure in Brazil 32 Figure 2.12: Conventional and white tariffs 35 Table 2.3: Smart grid- related government action in Brazil 37 Figure 2.13: Global distribution losses 36 Box 2.3: Smart meter business case in Brazil an analysis of loss reduction alone 39 Figure 2.14: Payback on AMI meter from loss reduction in average Brazilian home 39 Figure 2.15: Payback on average res/comm. AMI meter from loss reduction in two utilities 40 Figure 2.16: Aggregate cost savings from res/comm. non- technical loss reduction 41 Figure 2.17: Percent manufacturing sales lost to power outages 42 Figure 2.18: Electricity consumption growth in Brazil 42 Table 2.4: Percentage of customers who would alter habits if peak prices were to double 43 Table 2.5: Appliance ownership in Brazil 44 Table 2.6: Smart grid drivers and barriers in Brazil 45 Figure 2.19: Percentage renewable energy consumption in Latin America 47 Figure 3.1 Updated vs. original smart grid forecast 51 Figure 3.2: Timeline of smart grid development in Brazil 52 Figure 3.3: Combined smart grid forecast 53 Table 3.1: Brazil smart grid forecast data 53 Figure 3.4: Annual AMI deployments 54 Figure 3.5: Brazil smart meter penetration rate 54 Figure 3.6: Delayed deployment scenario 55 Figure 4.1: AMI cost breakdown 56 Table 4.1: AMI forecast data 57 Figure 4.2: Combined AMI forecast 58 Table 4.2: Communications technologies 59 Figure 4.3: Phasor measurement unit (PMU) forecast 64 Table 4.3 Distribution automation forecast data 65 Figure 4.4: Distribution automation forecast 65 Figure 4.5: Substation and distribution automation in Brazil 67 Table 4.4: Home energy management forecast data 74 Figure 4.6: Home energy management forecast 74 Figure 4.7: Electric vehicle forecast 77 Figure 4.8: EV incentives in Brazil 78 Figure 5.1: Smart grid development at Brazilian utilities 80 Table 5.1: Brazilian distribution utilities 81 Box 5.1: Light s Optimus program 88 Figure 5.2: Non- technical losses as a percentage of total sales in Brazilian utilities 89 Figure 5.3: Smart city projects in Brazil 92 Figure 6.1: Leading smart grid vendors in Brazil 105 Table 6.1: Leading smart metering vendors in Brazil 106 Table 7.1: The next steps and necessary actions 113 Table 8.1: Domestic electricity sector vendors in Brazil 120

7 Companies covered in this report ABB (Sui) AES (US) Alstom (Fra) BPL (Fra) Celesc (Bra) Cemar (Bra) Cemig (Bra) CESP (Bra) Choice (Bra) Copel (Bra) CPFL (Bra) CTEEP (Bra) Echelon (US) Ecil (Bra) Eletra Energy (Bra) Eletrobras (Bra) Elipse (Bra) ELO (Bra) Elster (Ger) Elucid (Bra) emeter (US) Endesa (Esp) Enel (Ita) EDP (Por) Gamesa (Esp) GDF Suez (Fra) Iberdrola (Esp) IBM (US) Impsa (Arg) ISA (Col) Itron (US) Landis+Gyr (Sui) Light (Bra) Logica (Ned) Nansen (Bra) Rede Energia (Bra) S&C Electric (US) Schneider Electric (Fra) SEL (Ger) Sensus (US) Siemens (Ger) Silver Spring (US) Telvent (Esp) Terna (Ita) TIM (Ita) Tractebel Energia (Bra) Treetech (Bra) Trilliant (US) V2Com (Bra) Way2 (Bra) Wobben (Ger)

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