North America Transformer Market

• Increasing Energy Demands from Industries and Upgrading old Transmission and Distribution Systems

Looking ahead, it is projected that electricity consumption will continue to rise at an average annual rate of 2.5 percent between 2023 and 2037. Moreover, according to the Energy Information Administration (EIA), the power demand in the U.S., which reached a peak of 4,048 billion kilowatt-hours (kWh) in 2022, is expected to decrease to 3,984 billion kWh in 2023, before subsequently increasing to 4,068 billion kWh in 2024. Thus, the advancing demand for electricity in countries such as U.S. and Mexico is anticipated to drive the demand for transformers used for supplying the power to industries. 

Additionally, the aging infrastructure of transmission and distribution systems in North America requires upgrades to ensure efficient and reliable power transmission. Upgrading these systems involves replacing outdated equipment, including transformers, with modern and more efficient models. This helps improve the overall performance and reliability of the power grid.

According to the U.S. Energy Information Administration, the average duration of annual electric power interruption stood at 7 hours from 2017 to 2021. Electric utility companies in the U.S. are confronted with a significant obstacle in the form of escalating maintenance expenses associated with aging infrastructure. Approximately 70 percent of transmission lines in the U.S. are more than 25 years old and nearing the end of their typical 50-80 year lifespan. As time passes, various components of the infrastructure, such as transmission towers, transformers, and power lines, undergo deterioration, resulting in frequent breakdowns and power outages.

According to the Department of Energy, power outages cost U.S. economy USD 28 billion to USD 169 billion annually.

• Rapid Adoption of Smart Grid Technology

The development of autonomous, self-regulating smart transformers is becoming more prevalent in the North American transformer market. During the projected period, an increase in demand for smart transformers used in smart grids is anticipated to be one of the major drivers of market expansion. The integration of smart grid technology is being facilitated by favourable government policies, growing consumer focus on smart monitoring units, and the need for sustainable electricity networks. Smart grid technology enables the efficient monitoring and management of electricity supply systems, promoting energy efficiency and grid reliability.

As a result, there is an increasing demand for advanced distribution transformers equipped with smart monitoring and communication capabilities.

The emphasis on grid modernization and smart grid initiatives in North America, particularly in the United States, has led to substantial investments in upgrading the aging power infrastructure. This has further driven the adoption of digital instrument transformers in the region. The focus on renewable energy integration and advanced grid management systems has also contributed to the demand for digital instrument transformers.

The programme provided funding for initiatives including distribution automation, enhanced metering, and energy storage that attempted to enhance the performance of the electrical grid. Small-scale electrical systems known as microgrids can function on their own or be connected to the larger grid. To enhance grid stability and resilience during catastrophes or natural disasters, many utilities have implemented microgrids. Overall, the region's power infrastructure is gradually incorporating smart grid technology, which offer considerable advantages in terms of efficiency, dependability, and sustainability.

• Escalating Population and Electricity Demand

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North America transformer industry is experiencing growing prospects as a result of the region’s rising population-related need for power. As a result of the population's continual growth, more people now depend on electricity to run their homes, businesses, and public infrastructure. Technological advancements, the widespread use of electronic devices, and the rising popularity of electric vehicles all contribute to the surge in electricity consumption. This upward trend in demand necessitates the expansion and upgrading of the electrical grid, which, in turn, requires the installation of new transformers. According to the U.S.

Energy Administration, the electricity generation in the U.S. witnessed an increase from 4,109.70 billion Kwh in 2021 to 4,188.40 billion Kwh in 2023. Thus, the advancing production of electricity in the region is anticipated to drive the demand for transformers over the forecast period.

The region's need for energy has been rising steadily over time as a result of a number of reasons, including population increase, technological development, and lifestyle shifts. The demand for power rises in tandem with America's expanding population. More electricity is needed to power more people's homes and businesses. Additionally, the increasing usage of electronic devices, appliances, and other energy-consuming machinery is a result of technological advancements. Electricity is needed for these devices to function, and as their popularity grows, so does the demand for electricity.

Due to all of these factors, the North America transformer market has seen growth and is even anticipated to grow much more strongly throughout the anticipated time.

Major market players are spending a lot of money on R&D to increase their product lines, which will help the North America Transformer Market grow even more. Market participants are also taking a range of strategic initiatives to grow their worldwide footprint, including new product launches, contractual agreements, mergers and acquisitions, increased investments, and collaboration with other organizations. Competitors in the North America Transformer Market industry must offer cost-effective products to expand and survive in an increasingly competitive and rising market environment.

One of the primary business strategies adopted by manufacturers in the global Transformer industry to benefit clients and expand the North America Transformer Market sector is to manufacture locally to reduce operating costs. The market for Transformer is recognized as being extremely competitive and fragmented. The market for Transformer offers considerable potential opportunities for domestic and unorganized companies. Some of the key players operating in the North America Transformer Market are General Electric (GE), Eaton, Hammond Power Solutions, Hammond Power Solutions, Olsun Electrics Corporation, MGM Transformer Company, Virginia Transformer Corp, Northern Transformer Corporation, Prolec-GE Waukesha, Inc., VanTran Transformers.

These companies have a strong presence in the region and offer a wide range of products and services, such as distribution transformers, power transformers, instrument transformers, dry type transformers, oil immersed transformers, and transformer services.

Olsun Electrics Corporation - In November 2023, introduced this year the new MTM XS600-P10 for core cutting and an additional line to increase the production capacity for more and bigger transformer mitre cores. In addition to advanced cutting programs, the new line has the latest technology in electronic components and mechanical controls for cutting.

Eaton- In October 2023, Eaton is invested $85 million to expand its North American manufacturing operations to meet growing demand for its utility solutions. This investment helped company to support the energy transition and electrification efforts by increasing the production of critical equipment such as underground protective connectors, transformers, and voltage regulators.