Rising Investments in Smart Grid Infrastructure to Bolster Growth of Switchgear Market
Expansion of smart grid network worldwide is expected to complement the growth of the switchgear market. Use of switchgear in smart grids to carry out control and protection functions is likely to increase in the coming years on the back of increasing investments and expanding smart grid infrastructure. According to International Energy Agency (IEA), extreme weather events in 2021 worldwide have highlighted energy security risks that are being induced by climate changes. This called for significant investments in highly resilient electricity grids on the global front. Governments worldwide are emphasizing more on digitalization and smart grid technologies. For instance, China’s State Grid Corporation announced plans to invest US$ 3.5 billion in enhancing its digital infrastructure.
Likewise, Europe has laid its plans for smart grid expansion for the 2021-2030 timeline, which have become the foundation for increased investments in this sector backed by economic recovery schemes. An annual investment of about US$ 70 billion in smart grid infrastructure was foreseen post the announcement of 2030 climate ambition plan in Europe to achieve emission free electricity generation. Similarly, in United States, plan to build a highly resilient smart grid network in a bid to accomplish carbon free generation of electricity by 2035 was announced. Such government efforts and increasing investments in smart grid infrastructure is more likely to pave an opportunistic pathway for switchgears, consequently bolstering the growth of the switchgear market.
Indoor Installations Likely to Spearhead in the Coming Years
Demand for switchgear for indoor installations is anticipated to significantly increase on the global front. This can be attributed towards increasing importance of protective control for any power system network. Switchgear facilitates a streamlined working of electrical appliances, in turn protecting them from electric overload and from damage through short circuit. In any indoor environment, the risk of fire hazard due to short circuit or electric overload on appliances makes it imperative for circuit protection, which as pushed the demand for indoor switchgear installations in home and commercial spaces.
In addition, advantages of indoor switchgears such as higher safety, low space requirements, easier maintenance, high durability, less operating costs, less prone to critical environment conditions, less electrocuting risk owing to grounded enclosures and high security are further pushing their demand. Indoor switchgear is also cost effective, highly customizable and reliable than its outdoor counterparts. In this backdrop, increasing indoor switchgear installations are in the offing consequently contributing towards switchgear market growth.
Demand for Gas Insulated Switchgear to Witness Momentous Growth as Compared to its Air Insulated Counterpart
GIS or Gas Insulated Switchgear is poised to account for a significant share in the switchgear market. GIS is a much sought-after system for substations with limited or less area. Gas insulated switchgear does not require large space and is free of maintenance. Moreover, it can be assembled easily offering higher reliability as compared to air insulated switchgear as it limits frequency of outages. Mainly installed in confined spaces such as in offices, roofs, offshore substations and buildings, a gas insulated switchgear provides maximum flexibility and is environment friendly. That said, potential growth in the use of gas insulated switchgears is expected to largely influence the switchgear market worldwide.
Asia Pacific to Remain a Key Revenue Pocket for Switchgears
Asia Pacific is expected to showcase high growth potential apropos to demand and supply of switchgears on the back of substantial industrialization across emerging economies. Increasing investments in electricity networks and smart grids in developing countries such as China and India have created ample opportunities for switchgear instalments. For instance, according to IEA, in 2020, China invested US$70.7 Bn which rose to US$82.6 Bn in 2021. Additionally, the country’s 2060 net zero goal along with 14th Five Year Plan focusing on renewables, the ambitious expansion plans of state-owned utilities is expected to further trigger investments in this sector.
Likewise, smart grid deployment in India mobilized significant investments of around US$300 Mn. This was sanctioned through India’s National Smart Grid Mission. In 2021, Revamped Distribution Sector Scheme was introduced with an outlay of INR303,758 crores. The objective of this initiative was to enhance the reliability, affordability, and quality of power supply via an operationally efficient and financially sustainable distribution sector. The government of India is also aiming to achieve 175 GW of renewable power by end of 2022. These aspects are expected to fuel the growth of the switchgear market in the following years in Asia Pacific, making it a lucrative revenue pocket for manufacturers and distributors.
Global Switchgear Market: Competitive Landscape
Few of the major companies in the global switchgear market include Schneider Electric SE, Hitachi ABB power Grids Ltd., Siemens AG, GE, and Eaton Corporation.
Global Switchgear Market is Segmented as Below:
By Voltage
By Insulation
By Installation
By Current
By Application
By Region
Key Elements Included In The Study: Global Switchgear Market
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