valantic Viewpoint

Smart Metering Market

Germany’s smart meter gateway market is set for long-term expansion, driven by regulation, electrification, and a limited pool of BSI-certified suppliers.

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16.4%

Current Smart Meter Gateway (SMGW) installation progress in Germany (as of June 2025)

95%

Mandatory Smart Meter Gateway Installation Target Across Germany By 2030

~8% CAGR

expected in Europe’s underlying metering equipment market until 2030.

Executive Summary

Smart Metering Market on the rise driven by regulatory mandates and rising electrification of heat and mobility

The Smart Meter Gateway Market in Germany is expanding as regulatory mandates and energy-system digitalization converge. Germany aims to achieve 95% installation across all mandatory SMGW points by 2030, yet today the deployment stands at around 16.4%. Looking beyond mandates, only a small fraction of all measuring points is equipped to date, underscoring both the early stage of Germany’s digital grid transformation and the broader policy ambition to establish SMGWs as a standard communication and control layer across the grid.

Key players differentiate through BSI certifications and interoperability across ecosystems, with Germany’s BSI certification requirements resulting in a small circle of fully compliant manufacturers, making regulatory fluency and ecosystem integration notable advantages.
With digital grid control gaining importance and the European electrical metering equipment market valued at ~3-3,5bnEUR, investment opportunities lie in companies able to combine certified hardware, interoperability and CLS enablement.

Key Findings

1

Mandatory rollout remains in early phase with 16.4% completion, ensuring a strong multi-year volume trajectory.
2

Near-universal rollout is still in its early stages, with significant room to scale beyond mandatory installation progress.
3

A limited pool of fully certified SMGW suppliers creates defensibility and reinforces established positions.

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Jan Dingerkus
valantic Partner

”We see a market where electrification, policy ambition and a limited set of fully compliant vendors jointly create a long-term growth profile.“

Market Trends: Rising compliance drives industry consolidation

The SMGW market is shaped by stringent regulations like Germany’s GNDEW mandate, targeting 95% installation of mandatory measuring points, with interim milestones such as a 20% installation target by end-of-year 2025. Broader ambitions such as a near-universal rollout across all measuring points. Cybersecurity requirements favor domestic suppliers with BSI-certified solutions due to increased development costs deterring international competitors. Additionally, EU climate goals are accelerating electrification across sectors like mobility and heating, indirectly boosting SMGW demand as a grid management necessity.

Key Takeaways:

Compliance requirements continue to deter new entrants
Rollout progress remains early, even against near-term milestones
Electrification amplifies the need for secure control capabilities

Testing, Inspection & Certification Market

Market Drivers: Decarbonization fuels new energy infrastructure investments

EU climate policies targeting greenhouse gas reductions are pushing investments into clean energy technologies like electric vehicles (EVs), heat pumps (HPs), and photovoltaic systems (PVs). These developments increase electricity load volatility, driving utilities’ need for real-time data management enabled by SMGWs. Retrofitting aging buildings with modern infrastructure bundles smart meters with distributed energy resources (DERs), further supporting deployment at scale.

Key Takeaways:

EU Fit-for-55 aims to cut emissions by ≥55% from 1990 levels
Building retrofits often trigger SMGW installations
Electrification enhances demand for controllable load systems under §14a EnWG

Single wind turbine, a coal burning power plant with pollution and electricity pylons in the background.

Competitive Landscape: Fragmented players in regulated niches

The smart meter gateway (SMGW) market encompasses various groups of different heritage, including regional certified SMGW specialists such as Theben Smart Energy, Sagemcom Dr. Neuhaus, and PPC; regional platforms and metering service providers (MSPs) like kiwigrid or smartoptimo that offer integration and administration services; international metering providers such as Itron, Landis+Gyr, Diehl Metering, and Zenner; and integrated utility multinationals delivering scalable solutions across multiple utility segments. BSI certification remains critical for German-market leadership, with regional specialists leveraging regulatory expertise to compete effectively against global players.

Key Takeaways:

BSI certification remains a decisive factor for scalable german market access
Regional specialists leverage domestic expertis to compete against global players

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Business Models & Value Chain: Full-stack offerings dominate ecosystem integration

German regulation assigns metering data processing to metering point operators, enabling manufacturers to differentiate primarily through interoperability and secure supply-chain operation.
Leading players combine certified SMGW hardware with communication modules, CLS enablement and subscription-based software services such as network management systems (NMS) or certificate management provide recurring revenue streams that enhance profitability beyond regulated hardware price caps.

Key Takeaways:

Business models blend hardware sales with SaaS-like revenues
Compliance audits underpin advantage in security-critical environments

Two Diverse Software Developers Having a Meeting in a Conference Room.

Growth Levers: Scalability through partnerships & innovation

Future growth can be enabled by orchestrating large-scale installations through MSP and utility partnerships and scaling solutions that address event-driven deployment patterns. As Germany progresses from early rollout levels toward its broader policy ambitions, innovations in communication technology, grid data analytics and CLS-enabled control further enhance the reach and relevance of SMGWs in an increasingly distributed energy system. Firms that combine certified hardware, scalable software and strong partner ecosystems will be well-positioned to capture additional value streams.

Key Takeaways:

Event-driven installations require flexible partner-led execution
Secure, high-frequency data flows unlock emerging digital value pools
Long-term growth expands with broader adoption ambitions and electrification

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