Power Grid Market

[215 Pages Report] The global power grid market in terms of revenue was estimated to be worth $282.1 billion in 2023 and is poised to reach $367.4 billion by 2028, growing at a CAGR of 5.4% from 2023 to 2028. Manufacturers feel the urgency of moving toward the electrification of industrial processes and are beginning to strategize accordingly. Regulations are likely to force commercial fleets and vehicles to go electric. This rise in the electrification of industrial processes and the transport sector will eventually increase the electricity demand, leading to the growth of the power grid market.

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Power Grid Market Dynamics

Driver: Investments in upgrading and expanding transmission and distribution infrastructure

The increasing energy demand has resulted in the need for stable and reliable transmission and distribution networks. Uninterrupted power can only be assured through a system capable of handling sudden power shorts and drops. Substations in developed nations are being modernized to ensure an uninterrupted power supply with minimum losses. This is achieved by replacing the old components with modern and more efficient ones. These upgrades are smart and more protective from overcurrent situations. The rising demand for renewable energy sources and the increasing number of power generation plants drive investments in transmission and distribution (T&D) infrastructure, making the T&D system capable of handling long-distance power flow and minimizing energy losses caused by strong currents. Many countries, such as the US, the UK, China, and India, are significantly investing in modernizing their substations and developing a reliable supply network. This drive for the transition and modernization of power grid infrastructure drives the power grid market in the near future.

Restraint: High installation cost of HVDC transmission systems and high-end monitoring devices

Renewable energy can be harnessed effectively with the help of sound transmission infrastructure through which energy is carried from long distances to load centres. However, HVDC transmission systems require high initial investments for setting up converter stations for reliable and secure power transmission. An aging power grid infrastructure and lack of transmission capacities require substantial investments. Similarly, a power monitoring system helps in tracking harmonics, frequency stability, voltage regulations, and other conditions that help avoid power grid operational downtime and maintain high power quality. Low-end monitoring devices provide basic functionalities in the power grid, such as measuring voltage, power factor, and energy use.

On the other hand, high-end monitoring devices such as data loggers, power quality analysers, and data recorders include various features, such as disturbance detection and location, harmonic distortion analysis, and flicker detection. These devices are more complex and costlier than low-end monitoring and other energy management devices. Thus, the high initial cost of HVDC transmission and high-end monitoring devices restricts their deployment in utilities, hindering market growth.

Opportunities: Rapid urbanization and digitalization

Digital technologies are set to transform the global energy system in the coming decades, making it more connected, reliable, and sustainable. With the help of smart thermostats, the International Energy Agency  (IEA) report finds that smart lighting and other digital tools help buildings reduce energy consumption by 10% by using real-time data to improve operational efficiency. Meanwhile, massive volumes of data, ubiquitous connectivity, and rapid progress in artificial intelligence and machine learning technologies led to newer applications and business models across the energy system, from autonomous cars and shared mobility to 3D printing and connected appliances. More than 1 billion households and 11 billion smart appliances could be part of interconnected electricity systems by 2040, which is possible through smart meters and connected devices. This would allow homes to alter when and how much electricity to draw from the grid.

Rapid urbanization leads to high energy consumption, pollution growth, increased need for toxic waste disposal, resource depletion, inefficient urban infrastructure management, ineffective planning processes and decision-making systems, saturated transport networks, and social inequality and socio-economic disparity. These issues are resolved by adopting IoT and big data technologies in smart cities. Thus, the constant increase in several connected devices deployed across urban environments will result in exponential growth in data volumes and high demand for energy management systems, which is expected to create opportunities for the providers of smart grid systems

Challenges: Delays in grid expansion projects due to unclear regulations and lengthy approval processes

Planning and designing equipment for a power supply network requires a massive volume of data. Factors such as government interventions, lack of coordinated efforts, unclear regulations, and lengthy governmental approval and environmental clearance processes result in delays in implementing grid expansion projects. According to Europe’s 10-year network development plan 2020 edition, five transmission projects for interconnection between Portugal and Spain were expected to be commissioned by 2024. However, these projects are still in the design and approval phases. These delays extend the implementation of grid expansion projects and increase gas-insulated switchgear (GIS) procurement time. The delays in grid expansion projects make production planning highly challenging for power grid component manufacturers as most extra-high-voltage substations are manufactured according to the personalized demands of the buyers

Power Grid Market Ecosystem

Prominent companies in this market include well-established, financially stable manufacturers of Power grid systems and components. These companies have been operating in the market for several years and possess a diversified product portfolio, state-of-the-art technologies, and strong global sales and marketing networks. Prominent companies in this market include ABB (Switzerland), Siemens (Germany), General Electric (US), Prysmian Group (Italy), Nexans (France), and Schneider Electric (France)

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The cables segment, by component, is expected to be the largest market during the forecast period.

This report segments the power grid market based on components into five types: cables, variable speed drives, transformers, switchgear, and others. The cables segment is expected to be the largest market during the forecast period. These cables maintain the stability and reliability of the grid by ensuring that power flows smoothly and efficiently. Cables can be used to balance the load on different parts of the grid, prevent voltage fluctuations, and reduce the risk of power outages

By Application, the distribution segment is expected to be the largest during the forecast period

This report segments the power grid market based on components into three segments: generation, transmission, and distribution. The distribution segment is expected to be the largest segment during the forecast period. Power distribution is a critical component of the power grid infrastructure as it is responsible for delivering electrical energy from the transmission network to homes, businesses, and industries

“Asia Pacific”: The fastest in the power grid market”

Asia Pacific is expected to fastest growing region in the power grid market between 2022–2027, followed by the Middle East and Africa,  and North America. Rising investments in the aging infrastructure to ease the integration of renewable energy in the national grid are one of the key factors fostering the growth of the market in the Asia Pacific

Key Market Players

The market is dominated by a few major players that have a wide regional presence. The major players in the power grid market are ABB (Switzerland), Siemens (Germany), Schneider Electric (France), and General Electric (US). Between 2018 and 2022, Strategies such as product launches, contracts, agreements, partnerships, collaborations, alliances, acquisitions, and expansions are followed by these companies to capture a larger share of the market.

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Scope of the Report

This research report categorizes the market by component, power source, application, and region.

On the basis of by component, the power grid market has been segmented as follows:

• Cables
• Varaible Speed Drives
• Transformers
• Switchgear
• Others

On the basis of power source, the power grid market has been segmented as follows:

• Oil
• Natural Gas
• Coal
• Hydro Electric
• Renewables
• Others

On the basis of application, the power grid market has been segmented as follows:

• Generation
• Transmission
• Distribution

On the basis of region, the power grid market has been segmented as follows:

• Asia Pacific
• Europe
• North America
• Middle East & Africa
• South America

Recent Developments

• In November 2022, GE Renewable Energy launched HYpact switchgear. It can be used in several applications such as mobile (truck-mounted) substations and onshore wind substations. It makes the electrical network more predictable also reduces the customer’s operational costs, as well as their impact on the environment.
• In October 2022, Siemens and Eplan have formed a strategic alliance to expand their collaboration in software solutions for the industrial and infrastructure markets. Siemens' Electrical Products business unit will join the Eplan Partner Network as a strategic partner as part of this agreement. The goal is to better coordinate the products of both companies in order to provide optimised solutions for switchgear manufacturers and electrical planners.
• In February 2022, ABB entered into an agreement with OneSubsea to support its subsea multiphase compression system for Shell’s Ormen Lange field. ABB supplied variable-speed drives and subsea transformers to power subsea compressors.
• In March 2021, Nexans and Empire Offshore Wind LLC signed a preferred supplier agreement (PSA) to connect the Empire Wind offshore projects to the onshore grid. The turnkey projects include complete design and manufacturing, as well as the installation and protection of over 300 kilometres of export cables.

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