Big win for GE smart meters shows pros and cons of North American market
By: SGN Staff
Quick Take: Most analysts have written off the North American smart meter market for the near- to mid-term. The good news: there are still some big deals to find, as this win by General Electric demonstrates.
The bad news: Deals of this size take years (no exaggeration) to close. And when they finish, they are typically winner take all. European utilities tend to source from multiple suppliers, to hedge their bets and spread both risk and reward. But in North America, a vendor can spend tens (sometimes hundreds) of thousands of dollars over 12, 18, 24 or more months, only to get absolutely nothing.
As a result, only deep-pocket players can afford to bid on these big contracts. And even those with deep pockets have to suffer through very "lumpy" revenue lines â€“ the highs are very high, but the lows are very low.
GE has long had top-notch meters, yet they were largely absent from the mind-share wars of 2005-2010. But even if they were doing a bad job of building brand awareness, they were clearly doing a good job of behind-the-scenes negotiations. This win vaults them back into the race.
Incidentally, this project is a big win for Silver Spring Networks, as well. Its networking platform and smart grid applications will be at the heart of the system, eventually connecting 4 million homes and businesses.
- By Jesse Berst
GE and ComEd sign $200M smart meter deal to modernize Chicagoâ€™s grid
Â§ GE is Helping ComEd Create an Integrated, End-to-End Smart Grid
Â§ GE and ComEd to Deploy Approximately 4 Million Smart Meters through 2021 in the Chicago Area, Bringing approximately 50 GE Jobs to the City of Chicago
Â§ ComEdâ€™s Grid Modernization Program Will Help Improve Grid Efficiency and Reliability for Its Customers across Northern Illinois
CHICAGOâ€”July 9, 2013â€”GE (NYSE: GE) has been selected by ComEd, a unit of Chicago-based Exelon Corporation (NYSE: EXC) and the electric utility serving Northern Illinois, to deliver approximately 4 million smart meters from 2013 to 2021 in a deal worth more than $200 million (U.S.). The smart meters will allow ComEdâ€™s customers to better manage their energy usage and help ComEd more quickly detect and restore power outages.
â€œDeploying smart meters will not only strengthen economic growth, create jobs and modernize our electric grid, but empower our customers to take more control over their energy usage,â€ said Anne Pramaggiore, president and CEO, ComEd. â€œWorking side by side with GE, we are able to create a modernized grid that will improve reliability, provide new ways to save energy and money and benefit the Illinois economy.â€