China's smart meter industry is developing rapidly due to the widespread use of four types of meters, differentiated prices, and the evolution of the Internet of Things. In 2016, China's cumulative shipments of smart meters reached 280 million units, with a compound annual growth rate of 20.5% from 2011 to 2016. With the further popularization of smart meters in various fields, the market growth rate will slow down in the future, and shipments will show an average annual growth rate of more than 10.0% from 2017 to 2021. China's smart meter shipments grew by more than 10% annually from 2017 to 2021
From the perspective of market segments, China's smart meter market is currently the most mature, with shipments accounting for more than 70% of the country's total shipments in 2016. In addition, smart meters have the highest market penetration rate, reaching 90%, followed by smart gas meters at 55%, and smart water meters and smart heat meters at less than 20% each.
Smart meters: China's smart meter shipments reached 130 million units in 2016, with a CAGR of 7.1% from 2011 to 2016. Public tenders are mainly held by the State Grid and China Southern Power Grid, targeting 2S single-phase smart meters (accounting for more than 85% of the total tenders). As the smart meter retrofit market is close to saturation, growth mainly comes from new residential buildings. However, China has lowered its real estate growth target again during the 13th Five-Year Plan period (2016-2020), so the CAGR of shipments is expected to be between 3% and 5% from 2017 to 2021.
Smart water meters: In 2016, China's smart water meter shipments reached 18.49 million units, with a CAGR of 20.2% from 2011 to 2016. Due to the low penetration rate, the market demand for smart water meters will show steady growth in the next few years driven by the "Smart Water" plan, with shipments expected to reach 21.03 million units in 2017 and 34 million units in 2021.
Smart gas meters: Driven by national policies, traditional gas meters are gradually transforming into smart ones, which is conducive to the vigorous development of the smart gas meter market. In 2016, the shipment volume of smart gas meters in China reached 23.37 million units, with a compound annual growth rate of 26.2% from 2011 to 2016. In the future, as the process of converting coal into natural gas accelerates, the demand for smart gas meters will continue to rise, and the shipment volume will show an average annual growth rate of at least 15% from 2017 to 2021.
Smart heat meter: Mainly used in northern China, heat meters have grown slowly compared to several other smart meters in an immature market and an industry without unified standards. Shipments in 2016 were 3.31 million units, up 1.2% year-on-year. Some southern cities have expressed their intention to heat their homes in winter, and if this idea comes true, it will generate new demand for heat meters.
