Electricity is a vital force that shapes our modern world and influences our quality of life. It is a driving factor for overall economic development and social progress. Power utilities play a crucial role in ensuring a continuous and reliable supply of electricity to every corner of the globe. However, to enhance the efficiency of the power ecosystem, improve grid reliability, access real-time information, and promote energy conservation through operational efficiency, a digital transformation is essential.
Across the globe, many utilities are embracing digitalization by incorporating smart meters and advanced metering infrastructure. These technologies enable the collection of real-time usage data from customers and provide functionalities for control, such as time-based rates and demand response. For example, CenterPoint Energy in the United States implemented an advanced metering system, SCADA mobile data platform, and a customer vision platform. This initiative aimed to strengthen the connection between the utility company and its customers, fostering better communication and service.
Similarly, General Electric in the United States initiated a smart grid test program to showcase the potential of integrating digitally equipped devices owned by customers with General Electric's smart grid for customer energy programs. This illustrates the shift toward a more interconnected and digitally-driven approach in the power sector.
The adoption of digital technologies in power utilities brings several advantages. Smart meters and advanced metering infrastructure allow utilities to gather real-time data on electricity usage patterns. This data is invaluable for optimizing energy distribution, identifying areas of high demand, and implementing strategies to enhance overall grid performance.
Moreover, digitalization facilitates the implementation of innovative features like time-based rates and demand response. Time-based rates allow utilities to adjust electricity pricing based on the time of day, encouraging consumers to use energy during off-peak hours when it is more abundant. Demand response enables utilities to manage electricity consumption during periods of high demand by incentivizing consumers to reduce their usage temporarily.
The example of CenterPoint Energy demonstrates how these digital advancements can improve the relationship between utility companies and their customers. With real-time data and better communication channels, utilities can address customer needs more efficiently, respond to outages promptly, and provide personalized services.
General Electric's smart grid test program highlights the potential for collaboration between utilities and consumers in creating a more integrated energy ecosystem. When customers' digitally equipped devices are synchronized with the smart grid, it opens up opportunities for enhanced energy management, increased efficiency, and a more sustainable use of resources.
In conclusion, the digital transformation of power utilities is a pivotal step towards improving the efficiency and reliability of the global power ecosystem. Smart meters and advanced metering infrastructure lay the foundation for real-time data collection, enabling utilities to make informed decisions about energy distribution. The integration of digital technologies also fosters a closer relationship between utilities and consumers, paving the way for more personalized services and responsive energy management. As the world continues to evolve, the digitalization of power utilities will play a crucial role in shaping a more connected, efficient, and sustainable energy future.
Report Attribute/Metric | Details |
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Market Opportunities | Rising demand for energy in the developing economies |
The Transformer Market size is projected to grow from USD 26.16 Billion in 2024 to USD 45.23 Billion by 2032, at a CAGR of 6.27% during the forecast period from 2024 to 2032. A rapid expansion is expected in the Transformer Market in the coming years owing to circumstances such as a substantial global investment push to enhance current electricity transmission facilities and rising demand from the public and the government for cleaner, greener energy sources. Because of their role as high-efficiency electricity distribution equipment, converters are drawing a lot of attention from investors worldwide.
Power initiatives targeted at lowering transmission and distribution losses and increasing demand for transformers are expected to boost the transformer sales volume significantly. A meaningful paradigm change in global power consumption has occurred, with a gradual radical departure of carbon-based energy sources into renewable energy sources. These changes in the renewable sector are expected to impact transformer market dynamics throughout the world during the forecast period.
Source: Secondary Research, Primary Research, MRFR Database and Analyst Review
Distribution transformers (DTs) are responsible for the ultimate voltage shift in the electrical power distribution system. Distribution transformers (DTs) are utilized to reduce the voltage of distribution lines, which can reach up to 36 kV, to the voltage level required by the client. Across numerous countries, the implementation of electrical transmission and distribution initiatives has resulted in a consistent increase in transformer capacity in recent times.
In 2021, the transformer capacity distribution network in Mexico reached 1,14,807 MVA. The proliferation of transmission networks in numerous countries led to the widespread utilization of distribution transformers. Utility companies are constructing distribution voltage regulators not just to fulfill the demand for electricity during periods of high usage but also to optimize power consumption during periods of low usage.
In June 2022, Diotec Semiconductor, a distributor of discrete semiconductor components, and Mouser Electronics Inc. entered into a distribution agreement. Mouser will offer customers a range of voltage regulators, rectifiers, FETs, and diodes manufactured by Diotec Semiconductor. These electronic components are specifically designed for use in commercial and industrial applications.
Apart from this, in April 2021, Enel, a power corporation headquartered in Italy, declared its intention to venture into the power distribution sector in the United States. The corporation intends to allocate around USD 19.52 billion towards enhancing distribution networks within the next two years and USD 72.23 billion by the year 2030. These innovations greatly support the high market growth of distribution transformers during the forecast period.
The Transformer Market is primarily segmented based on insulation, phase and application.
Based on insulation, the transformer market is further divided into gas, oil, air and solid. Out of which, oil insulation segmentation dominates the market segment. Oil is frequently employed as an insulation medium in several industries due to its capacity to sustain stability in elevated temperatures. The electrical insulating properties of the material, such as its dielectric strength, minimize the risk of damage caused by high voltage. The advantages of oil insulators make them the favored choice for manufacturers.
In addition, oil serves the purpose of safeguarding other elements, such as copper coils, from potential harm, such as combustion. Oil serves as an insulator in various electrical devices, such as fluorescent lamp ballasts, high-voltage capacitors, oil-filled transformers, high-voltage switches, and circuit breakers. Typically, transformers utilize mineral oil, predominantly naphthenic, silicone, and bio-based oils for insulating purposes. Transformer manufacturers worldwide are increasingly using eco-friendly alternatives, such as ester oil, in response to growing environmental concerns.
Based on phase, the Transformer Market is further classified into single phase and three phase. Out of which, the three-phase segment owes the major market share and is predicted to witness the highest growth rate over the forecast period. Three-phase transformers are commonly employed in precision machine tools, the manufacturing industry, the mining industry, the petrochemical industry, automation equipment, and the telecommunication sector, among others, for power generation and distribution.
Three-phase transformers are the optimal selection for industrial equipment because of their superior cost-effectiveness, reduced weight, and smaller size at higher power ratings. For three-phase applications, using multiple single-phase toroid or ferroresonant devices can also be beneficial. Three-phase transformers are suitable for low-voltage distribution systems that experience high fluctuations and low voltage.
They offer a high level of isolation and powerful suppression of common-mode interference, and they can be customized by end-users according to specific characteristics. Therefore, three-phase transformers are utilized in a diverse array of applications. The advantages and extensive utilization of this technology are expected to increase significantly within the projected timeframe.
Based on application, the said market segment is further divided into residential & commercial, utilities and industrial. Out of which, the industrial segmentation owes the major market share. It is further expected to have the highest growth rate of 7.5% throughout the forecast period. Power transformers in industrial sectors provide industries with secure, hazard-free, and precise utilization of electricity. The increase in the industrial utilization of transformers is linked to the emergence of smart transformers, which give market players a competitive advantage. Furthermore, the significant global investment in energy generation, industrialization, and urbanization is compelling market participants to allocate resources to research and development efforts aimed at creating environmentally friendly transformers.
The Transformer Market is primarily studied across four major regions, namely North America, Europe, Asia-Pacific and the Rest of the World. Out of which, the Asia-Pacific region dominates the global market.
In 2023, the Asia Pacific power transformer industry held more than 41% of the global market share and is projected to grow at a compound annual growth rate (CAGR) of 7.9% by 2030. The regional expansion, driven by swift economic progress and a heightened demand for consistent and dependable electricity provision, is a result of the population rise in the region. China is making investments to expand its existing electrical transmission and distribution system to fulfil the increasing demand for power driven by rapid industrialization and urbanization.
The growth of the power transformer sector in China will be propelled by the installation of new transmission lines and substations, which aim to address the disparity between energy demand and supply. Due to increasing worries about the rates of greenhouse gas emissions and their potential harm to the environment, it is expected that the Asia-Pacific region will offer promising opportunities for growth in the power transformer business. The nation has experienced a surge in demand for power transformers due to the growth in industrialization, infrastructure development, and construction activities. Moreover, the Asia-Pacific region remains a prominent global energy producer, rendering it a highly profitable market for power transformer manufacturers.
The market expansion is ascribed to the incorporation of renewable energy in the North American region, which is seeing a notable transition towards renewable energy sources, such as wind, solar, and hydroelectric electricity. This transformation requires the incorporation of these sources into the grid through the use of transformers to convert and distribute power.
Major key competitors in the said market segment employ crucial strategies, including partnerships, joint ventures, mergers and acquisitions, product launches, and business expansion deals to expand their business operations across the globe and have a strong command over a certain region in the market.
September 2022 -
In September 2022, Hitachi Energy launched its innovative oil-free traction transformer RESIBLOC Rail, with an integrated cooling system and voltages up to 25-kilovolt (kV), at InnoTrans, the international trade fair for rail transportation at the Berlin Messe in Germany.
October 2021 -
In October 2021, Prolec Transformers Inc. signed an acquisition deal with SPX Transformers to expand its business operations in the United States.
May 2022 -
In May 2022, Hyundai Heavy Industries Group subsidiary Hyundai Electric was awarded a USD 122 million contract to supply transformers to NextEra Energy Inc., a worldwide leader in renewable generation.
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