Power Grid Market by Component (Cables, Variable Speed Drives, Transformers, Switchgear), Power Source (Oil, Natural Gas, Coal, Renewables), Application (Generation, Transmission, Distribution) and Region - Global Forecast to 2028
[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.
Scope of the Report
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Report Metric |
Details |
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Market size available for years |
2021–2028 |
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Base year considered |
2022 |
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Forecast period |
2023–2028 |
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Forecast units |
Value (USD Million/Billiona) |
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Segments covered |
Power grid market by component, power source, application, and region. |
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Geographies covered |
Asia Pacific, North America, Europe, South America, and Middle East & Africa. |
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Companies covered |
ABB(Switzerland), Siemens(Germany), General Electric(US), Prysmian Group (Italy), Nexans(France), Schneider Electric(France), Mitsubishi Electric(Japan), Eaton(Ireland), Hitachi Energy(Switzerland), Powell Industries(US), Havells(India), LS Elctric(South Korea), Hubbell(India), Toshiba Energy Systems & Solutions Corporation(Japan), Fuji Electric(Japan), Sumitomo Electric(Japan), NKT(Denmark), Hyundai Electric & Energy Systems Co, Ltd(South Korea), Secheron(Switzerland), and Southwire Company(US). |
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.
Frequently Asked Questions (FAQ):
What is the current size of the power grid market?
The current market size of the power grid market is USD 255.5 billion in 2021.
What are the major drivers for the power grid market?
Electrification of industrial processes and fleets and Investments in upgrading and expanding transmission and distribution infrastructure is the major driving factor for the power grid market.
Which is the largest region during the forecasted period in the power grid market?
Asia Pacific is expected to dominate the power grid market between 2022–2027, followed by North America and Europe. Rising urbanization and power demand with increased renewable energy capacity are driving the market for this region.
Which is the largest segment, by component during the forecasted period in the power grid market?
The cables segment is expected to be the largest market during the forecast period. These cables carry power from one country to another, as well as from one platform to another, and transfer power from renewable energy generation plants, which use wind, wave, and tidal energy, to generate electricity; regional electrical transmission networks; etc.
Which is the fastest segment, by the application during the forecasted period in the power grid market?
The transmission segment is expected to be the fastest market during the forecast period. The transmission network must be upgraded and operated to maintain a stable frequency and voltage, even during periods of high demand or unexpected events such as equipment failure or severe weather.
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The study involved major activities in estimating the current size of the power grid market. Exhaustive secondary research was done to collect information on the peer and parent markets. The next step was to validate these findings, assumptions, and sizing with industry experts across the value chain through primary research. Both top-down and bottom-up approaches were employed to estimate the complete market size. Thereafter, market breakdown and data triangulation were used to estimate the market size of the segments and subsegments.
Secondary Research
This research study on the power grids market involved the use of extensive secondary sources, directories, and databases, such as Hoovers, Bloomberg, Businessweek, Factiva, International Energy Agency, and BP Statistical Review of World Energy, to identify and collect information useful for a technical, market-oriented, and commercial study of the market. The other secondary sources included annual reports, press releases & investor presentations of companies, white papers, certified publications, articles by recognized authors, manufacturer associations, trade directories, and databases.
Primary Research
The power grid market comprises several stakeholders such as power grid manufacturers, manufacturing technology providers, and technical support providers in the supply chain. The demand side of this market is characterized by the rising demand for power grid in, generation, transmission, and distribution application. The supply side is characterized by rising demand for contracts from the industrial sector, and mergers & acquisitions among big players. Various primary sources from both the supply and demand sides of the market were interviewed to obtain qualitative and quantitative information. Following is the breakdown of primary respondents:
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Market Size Estimation
Both top-down and bottom-up approaches were used to estimate and validate the total size of the market. These methods were also used extensively to estimate the size of various subsegments in the market. The research methodology used to estimate the market size includes the following:
- The key players in the industry and market have been identified through extensive secondary research, and their market share in the respective regions have been determined through both primary and secondary research.
- The industry’s value chain and market size, in terms of value, have been determined through primary and secondary research processes.
- All percentage shares, splits, and breakdowns have been determined using secondary sources and verified through primary sources.
Power grid Market Size: Tow-Down Approach
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Data Triangulation
After arriving at the overall market size from the estimation process explained above, the total market has been split into several segments and subsegments. To complete the overall market engineering process and arrive at the exact statistics for all the segments and subsegments, the data triangulation and market breakdown processes have been employed, wherever applicable. The data has been triangulated by studying various factors and trends from both the demand- and supply sides. Along with this, the market has been validated using both the top-down and bottom-up approaches.
Market Defenition
The electric power grid is the physical system that delivers (transmits) electricity from where it is generated to the site where it is used (end-use, demand). The electricity leaving the generating station enters a substation with a step-up transformer that raises the voltage extremely high for long-distance transmission.
The growth of the market during the forecast period can be attributed to the planned rollout of green corridor programs across major countries in North America, South America, Europe, Asia Pacific, and the Middle East & Africa.
Key Stakeholders
- Analytics Vendors
- Communication Vendors
- Consulting Companies In The Energy And Power Sector
- DISCOMS
- Electric Utilities
- Energy & Power Sector Consulting Companies
- Energy Regulators
- Government & Research Organizations
- Government Utility Providers
- Independent Power Producers
Objectives of the Study
- To define, describe, segment, and forecast the power grid market based on component, power source, and application, in terms of value
- To describe and forecast the market for various segments with respect to five main regions (along with respective countries), namely, North America, South America, Europe, Asia Pacific, and the Middle East & Africa, in terms of value
- To provide detailed information regarding drivers, restraints, opportunities, and challenges pertaining to the market
- To provide a detailed overview of the supply chain, patent analysis, and Porter’s five forces in the market
- To strategically analyze the market with respect to individual growth trends, prospects, and contribution of each segment to the market
- To analyze market opportunities for stakeholders by identifying high-growth segments and detailing the competitive landscape in the market
- To strategically profile the key players and comprehensively analyze their market ranking and core competencies*
- To track and analyze competitive developments such as sales contracts, acquisitions, collaborations, partnerships, agreements, and expansions in the market
Available Customizations:
With the given market data, MarketsandMarkets offers customizations according to the specific requirements of companies. The following customization options are available for the report:
Product Analysis
- Product Matrix, which provides a detailed comparison of the product portfolio of each company
Company Information
- Detailed analyses and profiling of additional market players
Generating Response ...
Growth opportunities and latent adjacency in Power Grid Market