Shunt Reactor Market Trends

Global Shunt Reactor Market Overview

The Shunt Reactor market is projected to witness significant growth during the review period, exhibiting a CAGR of 7.04%. The market was estimated to be USD 2688.18 million in 2024 and is expected to reach a value of USD 4631.7 million by the end of the forecast period (2024-2032). The global market for shunt reactors is influenced by several factors. Firstly, increasing energy demand, particularly in emerging economies, drives the need for grid modernization and voltage control solutions. As countries upgrade their power infrastructure to accommodate growing electricity demand, the demand for shunt reactors is expected to rise. Additionally, the growing deployment of renewable energy sources like wind and solar power necessitates investments in grid stabilization technologies. Shunt reactors play a crucial role in managing voltage fluctuations caused by the intermittent nature of renewable energy generation, supporting the integration of renewable energy into the grid.

Stringent regulatory standards and grid codes also mandate the deployment of reactive power compensation solutions like shunt reactors to maintain power quality and ensure compliance with voltage stability requirements. Utilities are compelled to invest in shunt reactors to adhere to regulatory mandates and uphold grid reliability standards. Furthermore, rapid industrialization and urbanization in developing regions drive the demand for electricity and necessitate investments in power infrastructure. Shunt reactors stabilize grid voltage and enhance power quality, supporting industrial growth and urban development initiatives.

Based on type, the oil-immersed segment accounted for a market share of 66.9% in 2022 and is expected to exhibit a CAGR of 6.5% during the forecast period. Oil-immersed shunt reactors currently dominate the market due to their ability to handle larger currents and higher voltages, making them suitable for high-power applications. Additionally, the insulation and cooling provided by oil immersion enhance reliability, making oil-immersed reactors preferred in large substations and power plants where efficiency is crucial.

Based on application, the variable segment accounted for a market share of 75.1% in 2022 and is expected to exhibit a CAGR of 6.3% during the forecast period. Variable shunt reactors are currently dominating the market due to their flexibility in adjusting reactive power compensation based on varying grid conditions. They are essential for regulating voltage levels and improving power factor dynamically, especially in systems with fluctuating loads or intermittent renewable energy sources, offering greater versatility compared to fixed shunt reactors.

Based on end use, the electric utilities segment accounted for a market share of 73.4% in 2022 and is expected to exhibit a CAGR of 6.4% during the forecast period. In electric utilities, oil-immersed shunt reactors dominate due to their robustness and capability to handle high-power applications typical in utility-scale operations. Conversely, in Industrial Verticals, variable shunt reactors are prevalent because of their ability to dynamically adjust reactive power compensation to meet fluctuating industrial energy demands efficiently, enhancing power quality and reducing energy costs.

“The Global Shunt reactor market is experiencing steady growth, driven by increasing demand for electricity transmission and distribution infrastructure upgrades. Factor such as, grid reliability, voltage stability are fueling the market expansion. Technological advancements in shunt reactor design and deployment are also contributing to the market growth, with Asia pacific emerging as a key region for market opportunities.”

Source Secondary Research, Primary Research, MRFR Database, and Analyst Review

Global Shunt Reactor Market Trends

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  Growing Energy Demand

  
  

The escalating global demand for electricity stands as a fundamental driver for the shunt reactor market, propelled by a convergence of demographic and economic factors. Population growth, urbanization, and industrialization collectively contribute to the surging need for electrical power worldwide. With an expanding global population, particularly in developing regions, there is a corresponding increase in the demand for electricity to power homes, businesses, industries, and essential services. Urbanization further amplifies this demand as more people migrate to cities, driving up energy consumption for residential, commercial, and transportation purposes. Additionally, rapid industrialization in emerging economies necessitates substantial energy resources to fuel manufacturing processes, construction activities, and infrastructure development.

Emerging economies, in particular, are experiencing a surge in electricity demand as they undergo rapid economic growth and industrialization. Countries such as China, India, Brazil, and Southeast Asian nations are witnessing unprecedented levels of energy consumption driven by infrastructure development, urbanization, and expanding industrial sectors. These regions are characterized by soaring energy needs to support growing populations, rising living standards, and increasing economic activities. As a result, utilities in these countries are under immense pressure to meet the escalating electricity demand while ensuring grid stability and reliability.

In response to the mounting energy demand, utilities worldwide are investing in grid stabilization solutions like shunt reactors to enhance grid stability and ensure reliable power supply. Shunt reactors play a crucial role in maintaining grid voltage within acceptable limits, thereby preventing voltage fluctuations and ensuring the smooth operation of electrical networks. By absorbing or generating reactive power as needed, shunt reactors help regulate grid voltage, improve power factor, and mitigate voltage variations caused by fluctuating loads or intermittent renewable energy sources.

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  Renewable Energy Integration

  
  

The global transition towards renewable energy sources, such as wind and solar power, represents a paradigm shift in the energy landscape, driven by the need to mitigate climate change, reduce greenhouse gas emissions, and enhance energy security. While renewable energy offers numerous environmental benefits, its integration into the existing power grid presents unique challenges due to the intermittent nature of wind and solar generation. Unlike traditional fossil fuel-based power plants, which provide consistent and controllable electricity output, renewable energy sources are subject to variations in weather conditions, such as wind speed and sunlight intensity, leading to fluctuations in power output and grid instability.

These fluctuations pose significant challenges to grid operators and utilities tasked with maintaining grid stability, voltage regulation, and power quality. Voltage fluctuations can disrupt the balance between electricity generation and consumption, potentially leading to voltage sags or surges, frequency deviations, and grid instabilities. Moreover, sudden changes in renewable energy generation can strain grid infrastructure, overload transmission lines, and impact the reliability of electricity supply to consumers.

In this context, shunt reactors emerge as indispensable grid stabilization solutions that play a crucial role in managing voltage fluctuations and ensuring grid stability during the integration of renewable energy. Shunt reactors absorb or generate reactive power as needed to regulate grid voltage, improve power factor, and mitigate voltage variations caused by fluctuating renewable energy generation. By providing dynamic voltage support and reactive power compensation, shunt reactors help maintain grid stability and enhance power quality, enabling the seamless integration of renewable energy into the grid.

Shunt Reactor Segment Insights:

Shunt Reactor Market by Type

The shunt reactor Market has been categorized based on type into Oil-immersed and Air-Core. The Oil-immersed segment accounted for the largest market share of 66.9% in 2022, with a market value of USD 1,615.3 million; it is expected to register a CAGR of 6.50% during the forecast period. The Air-Core segment accounted for the second largest market share in 2022, with a market value of USD 799.9 million; it is projected to register a CAGR of 5.4%.

Shunt Reactor Market by Application

Based on Application, the shunt reactor Market has been segmented into variable and fixed. The variable segment accounted for the largest market share of 75.1% in 2022, with a market value of USD 1813.0 million; it is expected to register a CAGR of 6.3% during the forecast period. The fixed segment accounted for the second largest market share in 2022, with a value of USD 602.2 million; it is projected to exhibit a CAGR of 5.5%.

Shunt Reactor Market by End Use

Based on End Use, the shunt reactor Market has been segmented into Electric Utilities and Online. The Electric Utilities segment accounted for the largest market share of 73.4% in 2022, with a market value of USD 1772.6 million; it is expected to register a CAGR of 6.4% during the forecast period. The Online segment accounted for the second largest market share in 2022, with a market value of USD 642.6 million; it is projected to exhibit a CAGR of 5.4%.

Shunt Reactor Market Regional Insights

By region, the global market is segmented into North America, Europe, Asia Pacific, South America, Middle East & Africa. Among these, The Asia-Pacific segment accounted for the largest market share of 63.5% in 2022, with a market value of USD 1533.2 million; it is expected to register a CAGR of 6.6% during the forecast period. The North America segment accounted for the second largest market share in 2022, with a value of USD 415.4 million; it is projected to exhibit a CAGR of 4.9%.

Shunt Reactor Market Players & Competitive Insights

The global shunt reactor market plays a pivotal role in enhancing the efficiency and stability of power transmission and distribution systems. Shunt reactors are essential electrical devices designed to compensate for capacitive reactive power, maintain voltage levels, and improve the overall power factor in electrical networks. These reactors absorb and release reactive power, mitigating voltage fluctuations and ensuring optimal grid performance. As the demand for reliable and stable power supply grows, the shunt reactor market has witnessed significant expansion. Factors such as increasing electricity consumption, grid modernization initiatives, and the integration of renewable energy sources contribute to the market's growth. Key players in the industry continually innovate to develop advanced shunt reactor technologies, addressing the evolving needs of the power sector and fostering sustainable energy infrastructure worldwide.

The leaders in the Shunt market, including companies like NISSIN ELECTRIC CO LTD, ABB INDIA PVT LTD, MITSUBISHI CORPORATION, FUJI ELECTRIC, HD HYUNDAI HEAVY INDUSTRIES CO., LTD., TBEA, HILKAR, TOSHIBA CORPORATION, SIEMENS AG, and GE GRID SOLUTION, are implementing various strategies to maintain and enhance their market positions. One key strategy employed by these market leaders is continuous innovation and product development. With a focus on research and development, these companies are investing in the creation of advanced and efficient shunt devices. This includes incorporating the latest technologies to improve the performance, reliability, and safety of shunt products. Innovation in design, materials, and manufacturing processes enables them to offer solutions that meet the evolving needs of the market, such as increased capacity, enhanced fault tolerance, and reduced environmental impact.

Market leaders are also actively engaging in strategic partnerships and collaborations to strengthen their market presence. Collaborations with other industry leaders, utilities, and technology providers allow them to leverage complementary strengths, share expertise, and jointly address challenges in the shunt market. Such partnerships can lead to the development of integrated solutions and comprehensive offerings that cater to the diverse requirements of end-users. Additionally, strategic alliances can facilitate market expansion, both geographically and across different segments, providing access to new customers and business opportunities. Leaders in the shunt market are emphasizing sustainability in their business practices. This involves adopting eco-friendly manufacturing processes, promoting energy efficiency, and developing products that align with environmental standards. By demonstrating a commitment to sustainability, these companies not only meet the growing demand for environmentally responsible solutions but also enhance their brand image and competitiveness in the market.

In summary, market leaders in the Shunt market are differentiating themselves through continuous innovation, strategic collaborations, and a focus on sustainability. These strategies enable them to stay ahead in a competitive market by offering cutting-edge products, expanding their market reach, and meeting the increasing demand for environmentally conscious solutions.

Key Companies in the Shunt Reactor Market includes:

• Nissin Electric Co Ltd


• Abb India Pvt Ltd


• Mitsubishi Corporation


• Fuji Electric


• Hd Hyundai Heavy Industries Co., Ltd.


• Tbea


• Hilkar


• Toshiba Corporation


• Siemens Ag


• Ge Grid Solution

Shunt Reactor Market Developments

In December 2023, the National Transmission and Despatch Company Limited (NTDC) installed a shunt reactor on the 500 kV Guddu-Rahim Yar Khan Transmission Line to enhance power system stability. The reactor was effectively put in place by NTDC teams at Bay-02 of the Guddu-RYK transmission line after it had been energized without any hitch.

In September 2023, TenneT secured a deal worth almost €2 billion for substation construction projects in Germany and the Netherlands with an aim to quicken energy transition. Procurement of one hundred ten shunt reactors and one hundred sixty power transformers had been accomplished by the Dutch transmission system operator with Siemens Energy, Hitachi Energy, GE Grid and Royal SMIT as suppliers, respectively. Each supplier was given approximately a quarter of the whole supply.

In September 2023, Hitachi Energy delivered transformers and reactors for TenneT's transmission grid development program in Germany. This strategic partnership aims to contribute to energy transition through high-performing and sustainable equipment that enables the modernization of infrastructure, increased capacity, and improved grid stability.

June 2020 - Danish customer Semco Maritime appointed Siemens to provide the main electrical equipment for Mayflower Wind’s offshore wind project Electrical Service Platform (ESP). Located in Massachusetts near the central lease area, United States, this is a 1.6-GW project. By20122, Siemen hopes that they will have supplied components for Semco Maritime; however, the delivery of three 265 MVAr shunt reactors rated at 275 kV/239 kV is part of the contract.

April 2020- ABB Ltd signed a five-year framework agreement with Interconexion Electrica SA ESP (ISA), a Colombian electric transmission company, concerning its supply of crucial power equipment to ISA’s South American operations through its Power Grids business. This transaction alone would cost approximately $100m (£91.5m) in addition to the provision of shunt reactors and gas-insulated and air-insulated switch gears (AIS).

Shunt Reactor Market Segmentation

Shunt Reactor Market Type (USD Million, 2018-2032)

• Oil-Immersed


• Air-Core

Shunt reactor Market Application (USD Million, 2018-2032)

• Variable


• Fixed

Shunt reactor Market End Use (USD Million, 2018-2032)

• Electric Utilities


• Industrial Vertical

Shunt reactor Market Regional Outlook

• North America
  
  
  
  • US
  
  
  • Canada
  
  
  • Mexico
  
  
  
  


• Europe
  
  
  
  • UK
  
  
  • Germany
  
  
  • Italy
  
  
  • Spain
  
  
  • Rest of Europe
  
  
  
  


• Asia-Pacific
  
  
  
  • China
  
  
  • Japan
  
  
  • India
  
  
  • Australia
  
  
  • Rest of Asia Pacific
  
  
  
  


• South America
  
  
  
  • Brazil
  
  
  • Argentina
  
  
  • Rest of South America
  
  
  
  


• Middle East & Africa
  
  
  
  • Saudi Arabia
  
  
  • UAE
  
  
  • Qatar
  
  
  • South Africa
  
  
  • Rest of MEA