The global water meters market totaled 112 million units in 2018, of which more than 25% had communications. Overall, smart meters will grow to account for more than one-third of all unit shipments by 2025 as communicating meters continue to displace basic ones at increasing rates.
Although trends vary between regions, in general, the global market picture is one of growth for smart metering over the forecast.
Static metering grows to new heights in North America
Ageing infrastructure and high labor costs have been the primary market drivers of smart metering investments in North America for years. However, new software/services are radically changing the traditional business case for smart metering. As a result, hardware market trends are shifting at many different levels, especially around static metering in North America and Europe.
For example, mechanical meters continue to dominate North America, but annual static shipments will grow to a third of the product mix by 2025. Specifically, the new American Water Works Association (AWWA) ultrasonic standard (released in 2018) and a growing demand for leakage detection services are both driving this trend, since static meters can provide more precise measurements needed for such applications.
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With the relative maturity of smart metering in North America, utilities and vendors begin to need new justifications beyond billing automation to drive long-term growth, with leakage detection poised to become one of the key drivers in many markets.
Leakage will become a primary business justification for AMI
Leakage is a problem faced globally and can easily exceed 30% even in developed regions (e.g. Canada). Financially, there are multiple costs associated with system leakage, such as the cost to the utility for bulk water, pumping costs, wear on infrastructure, etc. However, for water scarce regions like South Africa, identifying leakage is far more important despite ts impact to the balance sheet; it could mean the difference between having water supply at all or not.
Globally, a growing number of countries are currently looking to address non-revenue water, and utilities will increasingly justify initial AMI spend to address it. This will help kick-start new rollouts in both new and established markets, especially in combination with the rise of new communication technologies as justification to move from AMR to AMI solutions. For example, Europe, Middle East and Africa (EMEA) maintains positive growth in annual communicating meter shipments through to 2025, despite the relative maturity of communicating meters to date.
Oceania, India and China drive shift towards communicating meters in Asia Pacific
Meanwhile, Asia Pacific remains the largest water meter market overall, but notably, India had the third highest volume of communicating meter shipments in the region behind China and Oceania in 2018. Interestingly, a new focus on non-revenue water (especially due to C&I water losses) from the recently elected administration, and plans to increase housing pipe rates will drive the country to more than double its annual communicating shipments by 2025.
Alongside Oceania and Japan, India will significantly contribute to the growth of annual communicating meter shipments in Asia Pacific, which will more than double in volume over the forecast. Unsurprisingly, though, China overshadows these countries at the regional level. Overall, an accelerating government push to target NB-IoT for multiple meter types will cause China to account for an overwhelming majority of total communicating meter shipments over the forecast.
In summary, the ongoing rollouts in several key regions point to prolonged and strong growth for communicating, static water meters for several years to come. Furthermore, these strong prospects are compounded by new market potential for technology in Asia Pacific and Eastern Europe, as well as in Latin America, which is partly the result of a growing focus around non-revenue water and system leakage.
This insight is from the IHS Markit Smart Utilities team, with data citations from the latest publication on the global water meters market. IHS Markit produces global data for the entire smart metering market in our Smart Utility Meter Intelligence Service.