Gas insulated substation market size is set to show considerable expansion from 2021 to 2027 with the rising electricity demand, mainly across the developing countries. According to the U.S. Energy Information Administration (EIA), worldwide electricity generation is expected to grow by 1.8% annually through 2050. This trend is like to boost new investments in the power sector, and in turn, elevate the need for electrical devices. The jump in the number of initiatives instigated by various governments around the globe to develop smart cities to conserve energy is another contributing factor to the industry growth.
The surging investments in transmission & distribution systems as well as low capital, limitations concerning the space availability across the highly populated urban areas, and the rising renewable power generation need will further fuel the industry prospects.
Gas insulated substations (GIS) make use of sulfur hexafluoride (SF6) as a major component on account of its superior dielectric properties and are known to be reliable, flexible, and environment friendly. Performance factors such as enhanced optimization and protection against external elements offered by the substations will additionally drive their demand in the coming years.
However, the higher costs of the gas insulated substations may hamper the industry expansion to a certain extent.
In terms of voltage, the gas insulated substation market is divided across medium voltage (>72.5kV) and high voltage (<72.5kV). The high voltage gas insulated substations are increasingly used to refurbish the existing the power transmission systems mainly across the European and North America region. According to T&D World, the Republic of Ireland employed high-voltage GIS in order to upgrade the major bulk-supply point substations in power transmission in the region while meeting all the current and future requirements in the confines of the existing site boundaries.
Asia Pacific is witnessing a higher demand for gas insulated substations with the surge in investments towards wind and solar farm developments and the rising coal consumption, mainly across India and China. The EIA has estimated that the combined, solar, wind, and coal are likely to be responsible for over 90% of the electricity generation mix for India in 2050.
The growing industrialization, urbanization, and population size have escalated the demand for reliable power supply in the region, making the continent a hub for higher electricity consumption. The increasing investment in transmission and distribution networks, considering the extending generation connections in the Asia Pacific will add positive impetus to the regional gas insulated substation penetration.
The key participants in global gas insulated substation market include energy bigwigs, inclusive of Schneider Electric SE, Alstom SA (General Electric), and ABB Ltd. (Investor AB, Cevian Capital, BlackRock, Capital Group Companies).
These suppliers of gas insulated substations are actively partaking in strategic decisions, including acquisitions, contractual agreements, and mergers, and are focused on novel product developments to cater to the increasing industrial requirements whilst gaining competitive advantages.
For instance, in April 2021, Mitsubishi Electric Power Products, Inc., introduced the latest addition to its high-voltage product line, a 245kV gas insulated switchgear to offer widespread uses in utility, municipal, and industrial applications.
Similarly, Siemens Energy, in April 2021, bagged the largest order to offer 10 bays of SF6-free GIS to Fingrid, which is Finland’s transmission system operator.
The global economic havoc brought by the COVID-19 pandemic paved the path for supply chain disruptions, creating roadblocks and laying a tremendous impact on several businesses worldwide. Its effect was also felt on the energy, mining, oil, and gas sectors on account of the nationwide lockdowns and containment directives set into motion by governments worldwide. The temporary shuttering down of the businesses significantly interrupted the demand for gas insulated substations.
However, the consistent effort put forth by several countries to reinforce their economic conditions is expected to spell advancement for the industry forecast in the post-pandemic era.