The global gas insulated transformer market is expected to reach USD 2.42 billion by the end of this year and is projected to register a CAGR of over 4.75% during the forecast period.
The market is negatively impacted by COVID-19 in 2020. Presently the market has now reached pre-pandemic levels.
- Over the medium term, factors such as increasing investments in transmission and distribution infrastructure, increase in power consumption, the rise of an influx of renewable sources in the energy mix, along with upgradation and modernization of aging infrastructure are expected to drive the market in the forecast period.
- On the other hand, strict environmental regulations and concerns regarding the use of SF6 gas and the high cost of gas-insulated transformers are likely to restrain the growth of the gas-insulated transformer market in the coming years.
- Nevertheless, the focus has increased on investments in clean energy projects and the development of renewable energy globally. As a result, the extensive development of new renewable projects, and rising electricity usage is likely to create an excellent opportunity for the gas insulated transformer market in the future.
- Asia-Pacific has dominated the gas insulated transformer market in recent years and is expected to witness significant market growth in the forecast period, with the majority of the demand coming from China and India.
Key Market Trends
Utility Sector to Dominate the Market
- The rising demand for electricity in cities globally, the lack of space to construct new substations or upgrade the existing ones that are located near the load centers, and adverse environmental conditions have encouraged a trend in overpopulated urban areas to move large-scale substations underground. This has led to a growing demand for incombustible and nonexplosive, large-capacity gas-insulated transformers (GIT) in order to prevent accidents and ensure the compactness of equipment.
- With increasing demand and a lack of environmentally acceptable sites for additional extra-high-voltage/high-voltage outdoor substations in city centers, utilities consider indoor substations an alternative solution.
- For instance, the Villaverde substation is part of the Madrid plan project developed by Spanish utility Iberdrola in agreement with the regional government and the city of Madrid. The plan replaces extra-high-voltage and high-voltage transmission lines crossing Madrid with an underground cable network. There may be 16 air-insulated substations dismantled and 18 new indoor substations built.
- The growth of the market for the utility segment during the forecast period is expected to be attributed to the growing demand for reliable power supply and increasing investments in the power infrastructure.
- Investments in smart grids and the up-gradation of older grids are also expected to significantly drive the power utility segment of the global gas-insulated transformer market. As many large countries in the Asia-Pacific, such as India, try to modernize their grid systems, large investments are being made.
- In February 2021, the Indian government signed a loan agreement of USD 304 million from the Asian Development Bank (ADB) for the development of the Assam Intra-State Transmission System Enhancement project, which aims to improve the reliability, capacity, and security of the power transmission network in the northeastern state of Assam. This followed ADB's USD 190 million loan for the upgradation and modernization of Bengaluru's power distribution system in December 2020 and a USD 132.8 million loan for improving the power distribution network in the northeastern state of Meghalaya.
- Therefore, owing to the above points, the utility segment is expected to witness a significant growth during the forecast period.
Asia-Pacific Expected to Dominate the Market
- The Asia-Pacific region is one of the most densely populated regions globally, and due to the rapid growth in industrialization and urbanization across the region, electricity demand has increased substantially over the past few years. Due to this, investments in transmission and distribution (T&D) infrastructure have also grown significantly over the same period. Additionally, as long-distance T&D projects are becoming more eco-friendly by reducing ecological impact and improving safety by creating underground networks and smaller substations, gas-insulated transformers are becoming increasingly attractive.
- In China, the government has identified ultra-high voltage (UHV) transmission projects as a significant area for power grid development. In 2020, the State Grid Corporation of China (SGCC) and China Southern Power Grid (CSG), 2 of China's largest State-owned power transmission utilities, announced that they had identified 14 projects for development in 2020. These projects are expected to employ High Voltage Alternating Current (HVAC) and High Voltage Direct Current (HVDC) technologies, and it is estimated that these projects will require investments worth USD 26.8 billion.
- In India, significant investments are also being made in T&D infrastructure. In February 2021, PowerGrid Corporation of India commissioned its 2GW-320kV, 165km long Pugalur-Thrissur HVDC line, which was built at USD 700 million. In December 2020, the Indian state of Maharashtra unveiled plans to build a USD 1.08 billion 800 kV underground HVDC project to supply an additional 1 GW of electricity to Mumbai. These projects are expected to require large power transformers, including GITs, in turn driving the market demand.
- The Asia-Pacific region is also the fastest-growing region in renewable energy deployment, with the growth being led by renewable energy giants such as China and India. Due to the rapid rise in renewable power generation, grid stability has become a significant issue in countries with a high level of renewable integration in their grids, which also require modernization of older T&D infrastructure. As renewable energy generated from sources such as solar and wind provide variable power output, traditional T&D systems are not suitable for renewable energy transmission and distribution and require up-gradation or retrofitting with smart grid technologies.
- Moreover, many large-scale electrical and T&D equipment manufacturing companies such as Hyosung, Meidensha, Mitsubishi, Toshiba and Zheijhang have originated from the eastern Asia-Pacific region, and most of their manufacturing facilities are concentrated in the region. According to the Powergrid Corporation of India, equipment such as gas-insulated substations for the Thrissur-Pugalur HVDC line was supplied by factories in India as a part of the Make In India Program. As the region has a robust electrical equipment manufacturing industry, proximity to demand centers is expected to boost the Asia-Pacific segment of the Global gas-insulated transformer market during the forecast period.
- Therefore, owing to the above points, the Asia-Pacific is expected to dominate the gas insulated transformer market during the forecast period.
The gas insulated transformer market is partially fragmented. Some of the major players in the market (in no particular order) include Hyosung Heavy Industries Corp, Toshiba Corp, Shihlin Electric & Engineering Corp., Nissin Electric Co. Ltd, and Trench Group., among others
- The market estimate (ME) sheet in Excel format
- 3 months of analyst support
TABLE OF CONTENTS
- 1.1 Scope of the Study
- 1.2 Market Definition
- 1.3 Study Assumptions
2 EXECUTIVE SUMMARY
3 RESEARCH METHODOLOGY
4 MARKET OVERVIEW
- 4.1 Introduction
- 4.2 Market Size and Demand Forecast in USD billion, till 2027
- 4.3 Recent Trends and Developments
- 4.4 Government Policies and Regulations
- 4.5 Market Dynamics
- 4.5.1 Drivers
- 4.5.2 Restraints
- 4.6 Supply Chain Analysis
- 4.7 Porter's Five Forces Analysis
- 4.7.1 Bargaining Power of Suppliers
- 4.7.2 Bargaining Power of Consumers
- 4.7.3 Threat of New Entrants
- 4.7.4 Threat of Substitutes Products and Services
- 4.7.5 Intensity of Competitive Rivalry
5 MARKET SEGMENTATION
- 5.1 Voltage
- 5.1.1 Low Voltage (Up to 72.5 KV)
- 5.1.2 Medium Voltage (72.5 KV - 220 KV)
- 5.1.3 High Voltage (Above 220 KV)
- 5.2 Installation
- 5.2.1 Indoor
- 5.2.2 Outdoor
- 5.3 End-User
- 5.3.1 Industrial
- 5.3.2 Commercial
- 5.3.3 Utility
- 5.4 Geography
- 5.4.1 North America
- 5.4.2 Europe
- 5.4.3 Asia-Pacific
- 5.4.4 South America
- 5.4.5 Middle-East and Africa
6 COMPETITIVE LANDSCAPE
- 6.1 Mergers and Acquisitions, Joint Ventures, Collaborations, and Agreements
- 6.2 Strategies Adopted by Leading Players
- 6.3 Company Profiles
- 6.3.1 Nissin Electric Co., Ltd
- 6.3.2 Arteche Group
- 6.3.3 Hyosung Heavy Industries Corp.
- 6.3.4 Meidensha Corp.
- 6.3.5 Mitsubishi Electric Corporation
- 6.3.6 Trench Group
- 6.3.7 Chint Group
- 6.3.8 Toshiba Corp
- 6.3.9 Takaoka Toko Co., Ltd
- 6.3.10 Shihlin Electric & Engineering Corp.
7 MARKET OPPORTUNITIES AND FUTURE TRENDS