North American utility companies, according to a new IDC report, will spend about $577.8 million on home energy management (HEM) solutions by 2016.
With much of the North American utility investment in HEM being mainly spent on pilot programs and testing, the report said that investment in HEM solutions will be more conservative than other areas in the smart grid.
By 2016, IDC Energy Insight said, adoption of HEM solutions will expand "as consumers become increasingly engaged and as utilities comply with regulatory mandates for home area network development as a critical component of the emerging smart grid."
However, North American electric utilities have to deal with a number of near-term challenges in deploying HEM solutions, including developing sound business cases, meeting HEM costs, and changing consumer behavior around fixed electricity rate structures.
When HEM is eventually adopted by more consumers, utilities will develop their businesses cases and engage customers to change their usage behavior through demand response and other programs, the report said.
"In the next five years, electric utilities will expand investment in technologies and services that enable home energy management because these solutions support the initiatives and goals of the emerging smart grid," said Casey Talon, research analyst, Smart Grid Strategies, IDC Energy Insights.
