Medium Voltage Switchgear Market Analysis

Medium Voltage Switchgear Market Analysis

The Switchgears with ≥ 21 kV to < 27 kV rating held the majority medium voltage switchgear market share of over 23% in 2022 and is set to expand at a CAGR of 7.5% through 2032, led by the increasing need for safe and reliable distribution networks in residential, commercial, industrial, and utility sectors. The expansion of large and multi-story residential complexes and apartments due to suburban migration will further contribute to the demand for these products. In recent years, there has been significant growth in the demand for components in the 27 kV to 33 kV range. This can be attributed to the extensive expansion of commercial establishments and the refurbishment and upgrading of small-scale industrial platforms in developing nations.

The medium voltage switchgear market from contactors segment dominated around USD 9.5 billion revenue in 2022 and will reach USD 21 billion by 2032. The adoption of contactor units has been driven by key factors such as effective corrosion resistance, lower costs, and ease of installation. Developed economies have prioritized the deployment of underground electrical networks to mitigate ecological damage caused by overhead lines. Overhead electricity lines emit waves that pose health risks to habitats along the network and also affect the aesthetic quality of the environment. As a result, utility companies have shown favorable inclinations towards underground networks due to their associated ecological advantages.

The medium voltage switchgear market from vacuum insulated switchgears segment is slated to register 6% CAGR till 2032, due to its advantages over other established insulation technologies and its high reliability among consumers. The product has experienced an increase in demand due to its economical pricing, reliable and safe operations, and leakage-free technologies. The versatile applications of vacuum-insulated distribution components and the continuous improvement of technological portfolios are expected to drive the demand for this technology.
 

Over the years, vacuum insulation has gained traction due to its regional availability and ease of manufacturing and installation. Despite having higher initial costs compared to other insulation technologies, utility companies and consumers prefer vacuum-insulated components due to their longer lifecycles and lower maintenance costs.

The medium voltage switchgear technology is used across several end uses including transformer substations, power stations, local electricity supply and others. Growing electricity demand across the globe has boosted the deployment of distribution infrastructure, thus driving the demand for medium voltage switchgear market for local electricity supply. Rapid urbanization, the need for reliable power distribution in residential, commercial, and industrial areas, and the integration of renewable energy sources into the local grid are few of the major drivers for market growth.
 

As urban areas expand, there is a growing requirement for efficient and stable electricity supply to meet the rising energy demands of households, businesses, and public infrastructure. Medium voltage switchgears play a crucial role in ensuring safe and reliable power distribution within these local electricity networks. Moreover, the transition towards cleaner and more sustainable energy sources has led to the integration of distributed generation systems, such as solar and wind power, into the local grid. Medium voltage switchgears facilitate the efficient integration and management of these distributed energy resources, contributing to the growth of the market.

The medium voltage switchgear market from utility sector is estimated to observe around 6% CAGR between 2023 to 2032. Utilities are increasingly investing in grid modernization initiatives to improve the efficiency, reliability, and resilience of their power distribution networks. Medium voltage switchgears play a crucial role in modernizing the grid infrastructure and enabling advanced functionalities such as smart metering, automation, and remote monitoring. The growing deployment of renewable energy sources, such as solar and wind power, requires efficient integration into the existing utility grids.
 

Medium voltage switchgears enable the safe and effective integration of renewable energy generation by managing power flow, voltage levels, and protection within the grid. In addition, With the increasing frequency and severity of natural disasters and other disruptions, utilities are prioritizing grid resilience and reliability. Medium voltage switchgears with advanced fault detection, isolation, and restoration capabilities play a critical role in ensuring the robustness and reliability of the grid infrastructure, therefore complementing its penetration across the globe.
 

Asia Pacific medium voltage switchgear market is predicted to exceed USD 28.5 billion by 2032, primarily owing to the increasing demand for effective Transmission & Distribution (T&D) systems. There is a growing need to upgrade and restore existing electrical setups, leading to increased funding in the energy infrastructure sector and contributing to the overall growth of the switchgear market. Key factors such as cost-effectiveness, reliability, longevity, and operational flexibility are expected to play a crucial role in shaping the industry landscape.
 

Continuous research and development efforts aimed at developing effective switchgear components, along with investments in manufacturing energy-efficient products, are strategic initiatives undertaken by industry players to drive growth. The deployment of renewable energy sources on a large scale and the expansion of smart grid networks in various nations are expected to have a positive impact on the penetration of switchgear products in the region. These factors, coupled with the increasing focus on sustainability and efficient energy management, create favorable market conditions for the switchgear industry.
 

Over the years, industries in China, India, and the rest of Asian region have emerged as significant energy consumers. The expansion of high and extra-high tension lines to meet the growing demands of these industrial establishments will be a key driver for the medium voltage switchgear market revenue. There is also a strong focus on refurbishing and retrofitting existing Transmission and Distribution (T&D) networks to ensure reliable and uninterrupted electric supply to industries, further boosting the demand for switchgear products. The market size for medium voltage switchgear in the North America is set to cross USD 15.5 billion by 2032.
 

The industry is poised to experience substantial growth in the region due to increasing investments in the development of new grid infrastructure. Various private and governmental financial institutions, such as the World Bank, International Finance Corporation (IFC), and the Asian Development Bank (ADB), are providing funding support for electrification projects, which will contribute to the growth of the switchgear market.