Global grid digitalisation investment will top $150bn by 2030 amid growing demand for energy capacity and flexibility, according to ABI Research.

Investments in energy grid modernisation and digitalisation have not kept pace with energy demands and requirements over the past years. Given rapid electrification and the ongoing energy transition toward net zero, spending on grid digital transformation needs to accelerate.

According to the report, aggregated worldwide investments in grid digitalisation will grow from $81bn in 2024 to $152bn in 2030.

“The benefits of the digital transformation of energy grids are huge and wide-ranging,” said Dominique Bonte, vice president at ABI Research. “Most importantly, it enables the real-time management, orchestration and continuous reconfiguration of increasingly complex and distributed energy networks and assets while unlocking much-needed additional generation and transmission capacity. It also reduces costs in terms of both grid expansion and operational management, improves grid resilience in terms of reduced downtime and faster fault recovery, and enhances overall energy quality and efficiency.”

With the energy sector facing the reality of distributed and intermittent energy resources and systems, the need for higher flexibility is huge, especially at the edge of the energy grid, which experiences the highest friction between static energy supply and dynamic energy demand in a rapidly electrifying environment. This is where software-defined low and medium-voltage energy substations come into play in terms of facilitating flexible over-the-air functionality upgrades and configuration changes as well as managing and coordinating the two-way flow of energy, thereby ensuring grid stability in real time. Key suppliers of virtual substations include Schneider Electric and ABB.

Digital twins developed by companies such as Siemens are critical to design, model, simulate, plan and operate energy infrastructure.

AI and generative AI are increasingly becoming general-purpose technologies addressing use cases such a preventive maintenance, demand-response orchestration, amplification of customer service and maintenance personnel, and compliance reporting.

Companies such as GE Vernova and Hitachi Energy offer a portfolio of energy grid software, including advanced distribution management system (ADMS), distributed energy resources management system (DERMS), and snergy management systems (EMS).

Smart metering use cases go beyond traditional end user energy usage monitoring to provide granular edge and cloud intelligence needed to regulate and stabilise the upstream grid in real time and the use of metering data for billing purposes by resellers in an increasingly competitive environment. Honeywell is key actor in this space.

However, grid digitalisation faces multiple barriers and inhibiting factors including a lack of financing, rigid regulation, conservative and protectionist attitudes, aging workforces lacking digital expertise, limited competition, long infrastructure lifecycles, and cyber-security concerns.

“Going forward, it will be critical for energy utilities and technology providers to develop agile design and deployment practices, tap into innovative funding mechanisms, leverage open platforms and ecosystem cooperation, and address the human factor of embedding technology into company processes and culture,” said Bonte. “There is no room for failure. Others will be ready to invest in and take control of energy assets if needed.”

Details of the reports can be found at www.abiresearch.com/market-research/product/7784119-digitalization-challenges-in-smart-energy-.