The global gas insulated transformer market is valued at USD 2279 million in 2020, and it is anticipated to reach USD 3054 million by 2027, at a CAGR of 4.75% during 2022-2027. During 2020, the demand for gas insulated transformers slightly falls due to the decrease in global electricity consumption. 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. However, strict environmental regulations and concerns regarding the use of SF6 gas and the high cost of the gas-insulated transformers are likely to restrain the growth of the gas-insulated transformer market in the coming years.
- The utility sector is expected to be the fastest-growing market during the forecast period, owing to factors like growing demand for reliable power supply and an increase in investments in the power infrastructure.
- Globally, the focus has increased on investments in clean energy projects and the development of renewable energy. 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.
- 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 key players in this market include Hyosung Heavy Industries Corp, Toshiba Corp, Shihlin Electric & Engineering Corp., Nissin Electric Co. Ltd, and Trench Group.
- The market estimate (ME) sheet in Excel format
- 3 months of analyst support
Table of Contents
1.2 Market Definition
1.3 Study Assumptions
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
4.6 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
5.1.1 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)
5.4.1 North America
5.4.4 South America
5.4.5 Middle-East and Africa
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.
A selection of companies mentioned in this report includes:
- Nissin Electric Co., Ltd
- Arteche Group
- Hyosung Heavy Industries Corp.
- Meidensha Corp.
- Mitsubishi Electric Corporation
- Trench Group
- Chint Group
- Toshiba Corp
- Takaoka Toko Co., Ltd
- Shihlin Electric & Engineering Corp.