Business View Caribbean - May 2015 11
Central America & Caribbean Smart
Grid: Market Forecast 2015 - 2025
Research and Markets added the "Central America &
Caribbean Smart Grid: Market Forecast (2015 - 2025)"
report to its offering. The report is a regional study of
the smart grid market across 11 Central American and
Caribbean countries over the period 2015-2025 (64
pages + dataset).
The region will invest $3.3bn in smart grid infrastruc-
ture over the forecast period. This investment will tar-
get T&D losses of 20% across the region as well as
high electricity prices averaging 19.8 cents per kWh.
The Central America and Caribbean region offers
unique near-term opportunities for smart grid invest-
ment. The region has several strong positive market
drivers. Most notably, Central America and the Carib-
bean averages nearly 20% total T&D losses, primarily
due to electricity theft. This has created challenging
financial conditions for utilities and is spurring a num-
ber of smart metering efforts, many of which are al-
ready underway. At the same time, overall high crime
rates - particularly violent crime - make it difficult for
utilities to secure permanent loss reductions and
make deployments more challenging. Non-technical
loss reduction efforts are still expected to drive near-
term AMI deployments. In many Central American
countries, AMI penetration rates will approach 90% by
the end of the forecast period. But this is partly the re-
sult of small market sizes as the average market is just
over one million customers. This reduces the overall
market opportunity for vendors.
In addition to loss reduction,
Central American and Caribbean
countries will deploy smart grid
infrastructure to incorporate re-
newable energy and employ de-
mand response programs. These
will help reduce electricity prices
that average over 19 cents/kWh,
in part due to expensive oil-based
peaking plants. At the same time,
countries in the region on aver-
age consume just over 1,000
kWh per person per year, which
is less than half the emerging market average. This
diminishes the overall savings potential of smart grid
and demand response programs.
On balance, the case for smart grid infrastructure in
the region is strong. With non-technical losses continu-
ing to rise while smart grid costs decline, many utilities
will see the clear benefits of large-scale deployments
in the near-to-medium term. With strong economic
and geographic ties to the US market, Central Ameri-
ca's smart grid market is poised to accelerate over the
course of the next decade.
