The Internet of Things, or IoT, is an umbrella term referring to the ability of everyday physical objects (such as fridges, watches, or cars) to connect with other devices over the internet, enabling them to send and receive data.
By collecting and analysing the data they transmit, consumers and businesses will be able to monitor, maintain and upgrade these “things” much more efficiently.
In the process, many aspects of our lives, such as switching the lights on or predicting when the car needs its next service, will be automated, saving time, energy, and money.
IoT market segments for the power sector
We see five major markets for IoT, each defined by its own characteristics.
Within the consumer IoT segment, there is the automated home, the connected car, and wearable technology.
Within the enterprise IoT segment, the key markets are smart cities and the Industrial Internet. We have a full IoT market map available here.
Energy IoT solutions
Internet of Things (IoT) describes the use of connected sensors and actuators to control and monitor the environment, the things that move within it, and the people that act within it.
It is an umbrella term referring to the ability of everyday physical objects (such as fridges, watches or cars) to connect with other devices over the internet, enabling them to send and receive data.
Use cases include the automated home, the connected car, wearable technology, smart cities and many more.
For IoT companies in the energy and power sectors, four key technologies are enabling today’s IoT ecosystems: AI, cloud computing, cybersecurity, and 5G.
While pervasive IoT is still some years away, GlobalData is keeping a close eye on the use of IoT in power, as well as its evolution.
Improved data collection and analysis via sensors and the internet will enable power and energy companies to operate more safely, improve productivity, and reduce costs.
Examples include autonomous drilling, driverless haul trucks and predictive maintenance.
IoT market forecast landscape for energy companies
The global IoT market was worth $622bn in 2020, up from $586bn in 2019.
This is projected to grow steadily, reaching $1,077bn by 2024, with a compound annual growth rate (CAGR) of 13% over the period, according to GlobalData forecasts.
The enterprise IoT dominates the overall IoT market, generating 76% of total revenue in 2020.
This dominance of the enterprise IoT will continue for the foreseeable future. GlobalData expects this segment to still occupy 73% of the overall IoT market in 2024. The enterprise IoT market will grow at a CAGR of 12.4%, and consumer IoT revenue will increase at a CAGR of 14.6% between 2019 and 2024.
The global IoT market will generate a staggering $1,077bn in revenue by 2024, up from $622bn in 2020.
Enterprise IoT accounted for 76% of the market in 2020. Consumer IoT revenues will increase from 24% of the total in 2020 to 27% by 2024, with much of the growth coming from wearables.
IoT jobs insights in the power sector
GlobalData monitors live power company job postings mentioning Internet of Things (IoT) or those requiring similar technical skills.
IoT hiring trends in the power sector
Jobs postings by power companies that mention the Internet of Things (IoT) over the recent past. IoT jobs tracker in the power sector looks at jobs posted, closed and active in the sector.
Value chain for IoT energy solutions
GlobalData segments the value chain for IoT into five layers: devices, connectivity, data, apps, and services.
While these layers are logically discrete, large-scale IoT solutions will see a considerable degree of blurring of these logical boundaries.
For example, while there will continue to be a clearly identifiable data layer towards the top of the stack, a growing proportion of the data processing will take place within and at the edge of the network.
From the point of view of IoT adopters, it is also crucial to note that value is only realised by IoT adopters in the application layer.
All the data that an IoT network collects is ultimately worthless until action is taken as a result, whether that is in the form of an instruction to an irrigation unit or an alarm sent to a maintenance engineer, or an emergency call made to a doctor.
Industry challenges for IoT energy solutions
In 2021, the power sector has faced significant challenges across the entire value chain.
These include spiking energy costs, transitioning to renewables, and safeguarding assets against extreme weather conditions.
The Internet of Things (IoT), billed as a key part of the next industrial revolution or Industry 4.0, can significantly transform the power sector by optimising operations, managing asset performance, and engaging customers to lower energy costs.
The power sector is already reaping benefits from early consumer-oriented IoT applications: smart meters and smart thermostats. Incorporating IoT technology is also made easier by the declining costs of IoT hardware, notably sensors.
According to GlobalData figures, global IoT revenues in the energy sector will reach $59bn by 2025, up from $34bn in 2019.
For utility and power companies to effectively incorporate IoT-enabled smart devices into their infrastructure and daily operations, expertise must be on hand.
This involves employing more skilled IoT staff such as drone operators, data analysts, and software engineers.
Interestingly, there has been a rise in IoT-related job filings in 2021, as pandemic woes ease and companies look ahead at how to implement digitalisation.
Leaders and disruptors in IoT energy companies
The power and energy companies leading in IoT are either developing in-house expertise or partnering with leading IoT vendors to implement solutions across the IoT value chain.
These companies are mostly focused on adopting IoT technologies to optimise daily tasks, monitor assets more effectively, and offer consumers the ability to manage their energy usage more effectively.
Evolving landscape for IoT energy companies
Electricity trading, smart grids, and asset management represent primary growth areas for IoT in power, with power generation, transmission, and distribution as the key areas of IoT implementation.
This revolution is needed to mitigate the impact of the power sector on the environment. It allows consumers and energy providers alike to manage their emissions levels better while also helping to prevent future disruptions, such as wildfires caused by faulty powerlines.
Ultimately, the energy sector needs to incorporate IoT to safeguard against future issues and provide better service to its customers, who are more eco-conscious than ever before.
For an in-depth look at IoT energy companies’ leaders and vendors, you can find information here.
IoT influencer activity in the power sector
GlobalData tracks the mentions of IoT by pre-identified power sector influencers on Twitter. The graph indicates the volume of tweets and influencers mentioning IoT in recent months.
Internet of Things (IoT) Deals Activity in the Power Sector
Power Technology’s Internet of Things (IoT) deal tracker in the power sector monitors deals involving IoT or similar technologies over the past nine quarters.