Advanced Distribution Management System Market Size, Share & Trends Analysis Report By Offering (Software, Service), By System Type (Distribution Management System (DMS), Automated Meter Reading/Advanced Metering Infrastructure (AMR/AMI), Distributed Energy Resources Management System (DERMS), Energy Management System (EMS), Customer Information System (CIS), Meter Data Management System (MDMS)) and By Region(North America, Europe, APAC, Middle East and Africa, LATAM) Forecasts, 2023-2031

Market Overview

The global advanced distribution management market size was valued at USD 1,190.10 million in 2022. It is projected to reach USD 5,936.49 million by 2031, growing at a CAGR of 19.55% during the forecast period (2023-2031).

An ADMS is the OS platform that allows for the full suite of distribution management and optimization tools to be used. Automatic outage repair and improved distribution grid efficiency are two of the many benefits offered by an Advanced Distribution Management System (ADMS). ADMS services are being deployed by electric utilities for fault detection, isolation, and regeneration; volt/volt-amp reactive management; energy savings via reduced voltage; peak demand management; and support for microgrids and e-mobility.

The ADMS software offering is expanding significantly due to software investments made by the utility and power industries to improve the efficiency, profitability, and costs of generation and grid assets. Additionally, providers collaborate with software firms to offer their ADMS services. For instance, to support energy suppliers integrating customer-owned or -operated flexible distributed energy resources (DERs) into their distribution management operations, Auto Grid teamed with Schneider Electrics in January 2020. 

Market Dynamics

Global Advanced Distribution Management System Market Drivers:

Rapid Adoption of the Smart Grid Technology

The International Energy Agency (IEA) predicts that between 2012 and 2040, the global energy demand will rise by almost 80%. The growing deployment and investment in innovative grid technologies, including smart meters, EV chargers, and other related smart grid infrastructure technologies, drive the market. By facilitating two-way real-time communication between DISCOMs and consumers using GPRS technologies, smart meters, a crucial gauge of future-ready technologies, are paving the way for the smart grid. Smart grids are only complete with smart meters, which provide the real-time measurements required to monitor equipment health, grid congestion and stability, and system control. The adoption of smart meters has evolved significantly in recent years in various vital areas.

Global Advanced Distribution Management System Market Restraint:

High Initial Investment

With the introduction of smart grid technologies like smart meters, smart sensors, and other devices, improved distribution management systems are evolving along with technological advancements. Due to the integration of several technologies, the initial cost of installing ADMS is typically relatively high. The very high price of these systems also means that ROI is a challenge as it takes at least a year or two to recover the cost of an ADM's installation; the complexity of installing these systems is again very high; often, plans are coming from many companies put together. Installation can only be done with difficulty, and installation expenses are likewise significant.

Global Advanced Distribution Management System Market Opportunities:

Rising Investments in Energy Efficiency and Efficient Distribution Management Systems

Governments are investing in numerous initiatives, including the adoption of solutions that improve the efficiency of the power grid, the implementation of an efficient distribution management system, and sanctions on the use of technologies that are not efficient, to increase the world's investments in having a more energy-efficient infrastructure at a steady rate. Governments can embrace these solutions thanks to various vendors working in the energy efficiency sector, and these businesses are witnessing an increase in investments. For instance, the Asian Development Bank (ADB) awarded a loan to EESL in November 2019 totaling USD 250 million as part of a package of support for the company to increase its investments in energy efficiency in India.

Regional Analysis

North America Dominates the Global Market

The global advanced distribution management market is divided into four regions: North America, Europe, Asia-Pacific, and LAMEA. 

North America is the most significant revenue contributor and is expected to grow at a CAGR of 18.80% during the forecast period. In the field of power, the United States has been a leader in implementing cutting-edge technologies. Utility firms have adopted these (ADMS) solutions to more effectively and efficiently use their resources while focusing on enhancing the customer experience. The American government entities have taken the initiative to identify and gather partners and members of the power sector to address any end-user concerns. For instance, the Office of Electricity Delivery and Energy Reliability (DOE OE) and the U.S. Department of Energy have previously organized several Regional Smart Grid Peer-to-Peer Workshops in collaboration with electric utilities that had received American Recovery and Reinvestment Act (ARRA) funds.

Asia-Pacific is expected to grow at a CAGR of 21.30% during the forecast period. According to the BP Energy outlook report 2020, China has become a significant energy producer during the past 20 years, increasing its output from just 1239.3 terawatt-hours in 1999 to 7503.4 terawatt-hours in 2019. Due to the massive industrial change the country undertook, the energy consumption is in line with the production capability, which has, in turn, significantly increased the potential in the ADMS market. The advanced components of the ADMS provide advantages over conventional distribution management systems, such as high penetrations of distributed energy resources (DERs) management, tighter utility tool integration for meter data management systems, asset data and billing, and closed-loop interactions with building management systems (BMSs).

Germany has been concentrating on long-term, sustainable energy since 2010. The nation approved the Energy Concept, a strategic blueprint for implementing renewable energy. This plan creates a pathway with renewable energy as its cornerstone toward the year 2050. Germany intends to increase the contribution of renewable sources to energy generation, according to the International Energy Agency (IEA). In particular, the country exceeded its target of 35% of gross power consumption from renewable sources by 2020, with 38% in 2018 and 44% in the first half of 2019. This was set in the 2010 Energy Concept. The E-Energy funding program, which connects energy-saving technologies with communications systems and has produced several smart trial cities around the nation, was developed by Germany, a pioneer in the smart city concept.

According to estimates from the Global Smart Grid Federation, Mexico and Brazil were estimated to have 21 million smart meters installed by 2020, making them two of Latin America's largest potential markets. Mexico is viewed as a growing market for smart gas meters for its commercial customers, even though it essentially uses mechanical meters and is behind the United States in smart meter installations. The Paraná state utility Copel announced plans to implement smart meters and other technologies to automate its distribution networks in September 2020. Several phases of the Smart Electric Network (Rede Elétrica Inteligente) initiative will be carried out to eventually cover the entire state with what is anticipated to be the largest smart grid in the country.

Segmental Analysis

The global advanced distribution management market is segmented by offering and system type. 

Based on the offering, the global advanced distribution management market is bifurcated into software and service.

Modern electricity equipment, including Advanced Distribution Management System (ADMS) implementation, is being developed more and more to address issues like an aging workforce and infrastructure and the lack of wide-dimension software that would provide various functionalities unified in one program solution. As the power and utility sectors engage in software to maximize the efficiency, profitability, and income of generation and grid assets, the ADMS software product is experiencing substantial growth in the market under study. 

The ADMS is a decision support tool that enhances safety, dependability, asset protection, and service quality while assisting control room and field operating employees in monitoring and controlling the electric distribution system. Additionally, providers collaborate with software firms to offer their ADMS services. For instance, to support energy suppliers integrating customer-owned or -operated flexible distributed energy resources (DERs) into their distribution management operations, Auto Grid teamed with Schneider Electrics in January 2020. The Schneider EcoStruxure Advanced Distribution Management System (ADMS) will be connected with AutoGrid Flex, the first fully integrated flexibility management tool for the energy sector that communicates data and control signals using the open standard IEEE 2030.5.

Based on system type, the global advanced distribution management market is bifurcated into Distribution Management Systems (DMS), Automated Meter Reading/Advanced Metering Infrastructure (AMR/AMI), Distributed Energy Resources Management Systems (DERMS), Energy Management System (EMS), Customer Information Systems (CIS), Meter Data Management Systems (MDMS).

The Distribution Management System (DMS) segment owns the highest market and is estimated to boost at a CAGR of 18.20% during the forecast period. A collection of programs known as a Distribution Management System (DMS) is used to reliably and effectively control and monitor the distribution network. DMS serves as a support system that helps the operators in the control room and the field make decisions that will help them keep an eye on and manage the electric distribution system. By minimizing outage time, lowering outages, and maintaining a proper voltage and frequency level, these choices help to increase service reliability and quality. Electrical energy is now being used significantly more. Over the past few years, there have been significant changes in both quality definitions of power and customer expectations. 

Smart meters, communications networks, and data management systems are all part of the automated meter reading/advanced metering infrastructure, which enables two-way communication between utilities and customers. It automatically and remotely monitors voltage, connects and disconnects services, locates and isolates outages, and measures the amount of electricity utilized. It enables utilities to offer innovative time-based rate plans and incentives that encourage consumers to lower peak demand and control energy usage and expenses. It is paired with customer technology, such as in-home displays and programmable communicating thermostats. The market is anticipated to be forced to construct a more advanced metering infrastructure to lower the cost of remote billing and metering services.

To manage their grids built on distributed energy resources, distribution system operators frequently use a Distributed Energy Resources Management System (DERMS) platform. This is a Virtual Power Plant-related or even an exact match. The distributed energy resource management system industry is anticipated to grow due to factors like the rising demand for effective systems that support grid dependability and distributed energy source flexibility. In addition, the market for DERMS is projected to expand as renewable energy sources, which are intermittent and fluctuate over time, become more prevalent.

Power system operators use an Energy Management System (EMS), a computer-assisted tool, to monitor, control, and perform energy management at the best possible levels. By controlling power generation or demand, EMS is intended to minimize a specific objective, such as power loss, generation costs, or environmental effects. The growing attention being paid to concerns including controlling energy consumption, maximizing renewable energy sources, and lowering carbon footprint and greenhouse gas emissions is generating a need for EMS. Globally, both private businesses and governmental organizations are progressively placing a high priority on energy efficiency. Increased economic activity must result in high energy use rates, straining the world's electricity grids.

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