Digital Utility Market Size, Share & Trends Analysis Report By Technology (Hardware, Integrated Solutions), By Network (Transmission & Distribution, Retail, Generation), By Region, And Segment Forecasts, 2023 - 2030

Digital Utility Market Size & Trends

The global digital utility market size was valued at USD 179.27 billion in 2022 and is expected to grow at a compound annual growth rate (CAGR) of 9.6% from 2023 to 2030. The rising number of renewable power generation projects and energy efficiency mandates is one of the key trends stoking market growth. Stringent regulatory policies are further stimulating the growth of the market.

Soaring need for green energy and rapid digitalization are fueling the demand for digital utility solutions. Increasing penetration of digital technologies and spiraling demand for domestic electricity in countries such as China and India are anticipated to provide a fillip to the market.

The market in the U.S. is estimated to hold the largest market share in the North America region during the forecast period. The increasing number of renewable energy plants and growing environmental concerns are supplementing the growth of the market. Additionally, a rising number of government initiatives supporting digital transformation is projected to support the growth of the market in the country.

Digital utility solutions enable power generation plants to manage operations efficiently and help reduce the emission of greenhouse gases. Stringent regulatory norms are also expected to strengthen the market over the forecast period.

An upsurge in the amount of data collected and exchanged, coupled with an increase in the number of connected devices, is likely to provide a tremendous push to the market. Additionally, technological factors such as predictive maintenance, information exchange, and operational control solutions are playing an imperative role in the development of the market.

Digitalization has made everything more accessible and faster. In the case of energy and utility, the Industrial Internet of Things (IIoT) has digitalized various industrial processes such as power generation, distribution, and transmission. The integration of digital infrastructure with physical infrastructure is revolutionizing industry processes. The digital transformation of utilities has improved the efficiency of power generation and transmission as well as the distribution of electricity. The digital utility has expanded its capabilities by making physical systems more productive and autonomous and providing more choices for energy use.

The digital transformation is occurring across the entire value chain of energy due to increasing concern for customer satisfaction in the utility sector. The utility sector is significantly adopting cutting-edge digital technologies such as blockchain, artificial intelligence, and machine learning in order to transform, serve customers, operate, and interact with partners across the supply chain. Vendors in the market are focusing on providing high-quality customer service and launching new products in order to acquire more customers and gain a competitive edge.

Digital utility solutions have enabled users to manage energy generation and distribution operations effectively. The solutions provide capabilities such as predictive maintenance, improved safety & efficiency, and enhanced customer satisfaction. The growth of the market is attributed to factors such as an increasing number of renewable power generation projects and energy efficiency mandates. The growing need for green energy and rapid digitalization is further driving the growth of the market.

 The growing adoption of renewable energy sources is expected to create new growth opportunities for the market. The increasing use of renewable energy has led to the establishment of new renewable power generation projects. The advent of digitalization and connected devices is triggering new growth opportunities in the utility industry. The companies operating in the utility market are on the verge of digital transformation, thus adopting new digital utility solutions providing clean energy to end-users. Green energy plays a crucial role in reducing carbon footprint and maintaining balance in the ecosystem.

Network Insights

On the basis of network, the market is categorized into generation, transmission & distribution, and retail. The transmission & distribution segment accounted for the largest revenue share of 46.7% of the market over the forecast period. Transmission and distribution solutions are widely used across the utility industry owing to increasing emphasis on monitoring and management of electric transmission and distribution systems. Many electrical grids globally are aging and were originally designed to cater to a different era's energy demands. In order to meet changing business needs, utilities are investing heavily in upgrading their infrastructure. It involves the integration of advanced sensors, communication systems, and automation technologies into the grid. These elements collectively enable real-time monitoring of grid conditions, quicker detection of faults or outages, and the ability to manage and control various components of the grid remotely.

The retail segment is estimated to witness the highest CAGR of 12.2% over the forecast years. Data extraction and analytics techniques are widely used for efficient customer management, which is projected to drive the growth of the segment over the forecast period.

Regional Insights

North America dominated the market and accounted for the largest revenue share of 30.6% in 2022. The growth is attributed to the increasing number of renewable power plants and rising investments in electrical infrastructure. Additionally, growing digitalization and the emergence of several connected devices are likely to trigger the growth of the market over the forecast period.

The increasing number of renewable power plants to cater to the needs of the growing population is driving the growth of the digital utility market. The changing regulations and government policies related to utility are further driving the penetration of green energy in developed and developing economies.

Asia Pacific is expected to grow at the fastest CAGR of 13.0% during the forecast period. The region has surging demand for domestic electricity, and changing regulatory norms in the region are expected to stir up the demand for digital utility solutions. Additionally, increasing infrastructural development activities and growing energy needs in APAC are helping the regional market to gain remarkable momentum over the coming years.

The digital utility across various regions provides modern contact center infrastructure. The contact center infrastructure offers features such as contact center transformation, product & vendor evaluation, contact management, quality control, and service assurance. The infrastructure helps to develop, maintain, and upgrade contact center applications at utilities such as gas, water, and power. The enterprises use automation tools and communication technologies to redirect their customer support center and contact from service resolution to revenue generation. It provides a standardized workflow for better utilization of resources.

Technology Insights

The hardware segment accounted for the largest revenue share of 61.0% in 2022. Technological developments taking place in hardware and extensive use of smart meters, transformers, and other intelligent equipment are contributing to the growth of the segment. Smart grid solutions are sought after by organizations since they enable predictive maintenance, real-time analytics, and effective asset management.

The integrated solutions segment is expected to grow at the fastest CAGR of 11.5% during the forecast period.Integrated Solutions offered in the market include cloud and software services. The software solution assists in digitizing assets, optimizing operations, providing flexibility, and improving reliability.

Key Companies & Market Share Insights

The market players are undertaking strategies such as product launches, acquisitions, and collaborations to increase their global reach. However, it is estimated to bring down the cost of digital utility solutions over the coming years. For instance, in February 2022, Microsoft acquired Nuance, bringing together Nuance's conversational AI and ambient intelligence with Microsoft's secure and trusted cloud offerings. It is anticipated to help organizations across industries in delivering better customer experiences.

Recent Developments

• In May 2023, Siemens, a German manufacturing company, launched a new portfolio called Industrial Operations X, which allows users to seamlessly combine hardware and software components. It makes operational technology (OT) adaptable at the speed of software.

• In September 2021, Innowatts, an artificial intelligence firm, partnered with Amazon Web Services to help energy providers accelerate their digital transformation. By fully leveraging the transformative power of cloud-based and fully scalable data analytics, the company aims to handle over 4 billion data points each hour and provide utility industries better transparency in their operations.

Digital Utility Market Report Scope

Global Digital Utility Market Report Segmentation

This report forecasts revenue growth at global, regional, and country levels and provides an analysis of the latest industry trends in each of the sub-segments from 2017 to 2030. For the purpose of this study, Grand View Research has segmented the global digital utility market on the basis of technology, network, and region:

• Technology Outlook (Revenue in USD Billion, 2017 - 2030)

  • Hardware

  • Integrated Solutions

• Network Outlook (Revenue in USD Billion, 2017 - 2030)

  • Generation

  • Transmission & Distribution

  • Retail

• Regional Outlook (Revenue in USD Billion, 2017 - 2030)

  • North America

    • U.S.

    • Canada

  • Europe

    • UK

    • Germany

    • France

  • Asia Pacific

    • China

    • Japan

    • India

    • Australia

    • South Korea

  • Latin America

    • Brazil

    • Mexico

  • Middle East and Africa

    • Saudi Arabia

    • South Africa

    • UAE