Utility Horizons - Second Quarter 2013 - (Page 54)

On The HORIZON... Utility Automation & Information Technology projects had a very good year in 2012, and 2013 promises to be even better. As the North American market pulls out of a protracted multi-year recession, early indications are that 2013 will take up and perhaps exceed the pre-recession pace of automation/IT project development at utilities of all types, sizes and locations across the U.S. and Canada. The following, ʻYear-in-Reviewʼ compares CY2012 with the five (5) prior years from a New (Planned) and Existing (Legacy) projects perspective. The reasons for this optimism go well beyond economic recovery, however. Offsetting the decline in average smart metering project values – the result of being on the backside of the Stimulus-driven AMI surge between 2009 and 2012 – all utilities will face unprecedented challenges in the years ahead. recession that has held back growth in most other industrial and commercial markets – in many cases dramatically. Here’s our take on what happened in each year and why… 2008 [8481]: Recession, starting in Q4-2007, takes a big toll on 2008 projects as utilities – in sheer panic – put the brakes on everything possible until they could get a better grasp of the 1 decidedly negative economic outlook. 2009 [1150]: Obama takes office and pens ARRA Stimulus, creating a (temporary) positive surge in project activity, but most utilities continue to delay or abandon practically all projects except those involving AMI and/or Stimulus funding. 2010 [1133]: Utilities realize that the recession is not ending anytime soon, so they begin to scale back on project budgets, allowing only the most essential projects to move ahead, most of which are upgrades and expansions, but hardly any greenfield projects. The Aging Workforce issue also starts taking a toll, often delaying new project initiatives that retiring Boomers will not be around to complete. 2011 [1021]: Utilities continue to scale back project budgets as recession drags on, but glimmers of recovery begin to emerge in late Q3 and Q4, counterbalanced by ongoing Aging Workforce issues. 2012 [1054]: Utilities begin to see leading signs of economic recovery and start to release project budgets cautiously, but increasingly optimistically, as new demands for security, safety, reliability and operational efficiency start pushing hard against budgetary constraints. Also, election year rhetoric temporarily drags down economic outlook, but leading economic indicators paint a different picture, leading to growing optimism that a slow but steady recovery is under way. Looking Ahead: Mounting Challenges So far there are continuing signs that as the economic recovery continues, so will the trend toward releasing more utility automation/IT budgets and new project development. There are now readily apparent signs of economic recovery, and despite the now waning emphasis on smart metering, we strongly believe that Aging Workforce and Declining Infrastructure – together with mounting Security and Reliability challenges – will likely drive utilities to invest more confidently in automation/IT as their only realistic option to Numbers in [brackets] are the number of Planned (New) projects identified in each calendar year 54 • UTILITY HORIZONS • Q2 - 2013 www.UtilityHorizons.com http://www.UtilityHorizons.com

Table of Contents for the Digital Edition of Utility Horizons - Second Quarter 2013

Utility Horizons - Second Quarter 2013
Publisher’s Message
Contents
The Queue
Automation Rising!
Inside Tracks
Focal Point
Automation and Innovation at Epcor Water Services
BLeading Edge: Advanced Technology Perspectives
Consumer Engagement: The Future Goes Mobile
Demand Response: Why the Future Is in the Cloud
Building Paths to Smarter Water Management
Bullet-Proofing Your Scada System Against the Evil-Doers
Education Matters
Standard Bearings
Regulation De Rigueur
On the Horizon
Purviews
Intersections
Eventualities
Thinking It Through With Sparky Flamedrop
Loose Ends

Utility Horizons - Second Quarter 2013

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