Gas Utility SCADA Market Declining

Gas Utility SCADA Market Declining

By Alison Fowler, PennWell Research

Over the past three years, PennWell Research has identified a downward trend for installations of SCADA systems in the United States. This trend is happening in electric, water/wastewater and gas utilities. In January, PennWell Research released the “1997 Gas Utility/ Transmission Pipeline SCADA Market Data Report.” The report identified 170 SCADA project opportunities. That is a decrease of approximately 24 percent compared to the gas utility study results in 1995. Not only are the number of projects decreasing, but also the dollar value for these projects, as seen in the 1997 study findings. Nearly a 32 percent decrease in the dollar value of gas utility/transmission pipeline SCADA projects was seen in the 1997 report.

In looking at the number of projects by cost category, the “less than $125,000” category has increased from 28 percent in 1995 to 37 percent in 1997. In addition, the number of projects with an estimated budget of “$500,000-$999,999” has increased by 10 percent from 1995, as seen in Figure 1.

Each year, the “more than $3,000,000” category makes up the majority of the gas utility SCADA projects by dollar value. This year, as in 1995, this cost category is nearly half of the total value of all the gas utility SCADA projects. In 1997, there was an increase of 7 percent in the total dollar value of projects that were “$500,000-$999,999.” Figure 2 illustrates these results.

Gas utilities with 1,500-4,999 miles of distribution line plan to spend more on SCADA system installations or replacements than any other size category. Gas utilities in the “1,500-4,999 mile” size category have increased the budget for SCADA systems by 30 percent compared to 1995. Those gas utilities with 1-499 miles of distribution line are planning to spend 20 percent fewer dollars in 1997 than in 1995.

The number of transmission pipeline projects by transmission miles has changed dramatically since 1995. In 1995, those pipeline companies with 5,000-9,999 miles made up 18 percent of the total number of projects, while in 1997, those same utilities (5,000-9,999 mile category) comprise only 8 percent. The largest area of growth for the number of pipeline SCADA projects are pipeline companies with 1-699 miles. This group of pipeline companies has increased the number of SCADA projects by 18 percent.

Figure 3 illustrates a year-by-year breakdown of the number of gas utility/transmission pipeline SCADA projects. As the graph shows, the peaks for this market were seen in 1989, 1991 and 1994. Not only is there a decrease in the number of gas utility projects but also a slight decrease in the total dollar value, as seen in Figure 4. The market, in terms of dollar value for gas utility SCADA systems, is approximately 30 percent smaller than in 1989.

One reason that the estimated SCADA system budgets are smaller is the movement toward PCs as a main central processing unit. This is a less expensive alternative to the older mainframe configurations, therefore making the overall systems` budgets smaller. In fact, the 1997 study results show that 55 percent of the planned gas utility SCADA projects will be run from a PC-based operating platform. Mainframe-based systems comprise 4 percent of the planned systems in 1997, compared to 8 percent in 1995.

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The Clarion Energy Content Team is made up of editors from various publications, including POWERGRID International, Power Engineering, Renewable Energy World, Hydro Review, Smart Energy International, and Power Engineering International. Contact the content lead for this publication at Jennifer.Runyon@ClarionEvents.com.

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