Utility Scale Digital Substation Market Size - By Component, By Architecture, By Voltage, By Installation, Analysis, Share, & Forecast, 2025 - 2034

Utility Scale Digital Substation Market Size

The global utility scale digital substation market was valued at USD 3.9 billion in 2024 and is estimated to reach the value of USD 7.6 billion by 2034, growing at a CAGR of 6.8% from 2025 to 2034. With an ever-increasing demand for energy and a shift towards renewable energy sources, the utility scale market is experiencing significant growth. Large-scale power generation and infrastructure, as well as the transmission and distribution of electricity caters to all components of this market.
 

To increase reliability and efficiency, aging power grids are receiving upgrades in the form of smart meters, automated substations, and digital monitoring systems. Smart grids allow for real-time data collection, response to demand, and even better distribution of power. Greater implementation of Advanced Metering Infrastructure (AMI) along with supervisory control and data acquisition (SCADA) systems is taking place to limit energy loss and stabilize the grid.
 

To accommodate the increasing demand for electricity, T&D infrastructure is being modernized by governments and utilities to better integrate renewable energy. As an example, the Canadian government is actively working towards the goal of procuring 90% of the country’s electricity from non-emitting sources by 2030, making the effort to foster the growth of solar energy. Corporations and other entities that work in commercial solar power installation projects, will benefit from a federal tax credit of 30% available from 2023-2034.
 

The various types of energy storage systems - including battery storage, pumped hydro, and compressed air storage, are increasingly becoming an important part of any utility-scale project. Considering the erratic qualities of renewable energy sources, large scale storage facilities preserve grid reliability and synchronization between supply and demand. The U.S. and Australia, for example, are collaborating on initiatives to create battery storage systems at the gigawatt scale.
 

In U.S. the Dynegy Moss Landing Power Plant Hybrid in California is currently the largest battery storage project in the US, with a capacity of 750 MW. Additionally, RWE is also developing and building battery storage projects in the US, including Crowned Heron 1 and 2, and Cartwheel, which are planned to be completed in 2025.These projects will also cerate a sharp need for the digital substations across the utility sector in coming years.
 

Utility Scale Digital Substation Market Trends

• The IEC 61850 communication standard is becoming the global benchmark for digital substations. It enables seamless interoperability between different vendors' equipment, improving substation automation. Utilities are increasingly adopting this standard to enhance scalability, reduce wiring complexity, and ensure faster fault detection and response times.
   
• With growing cyber threats targeting critical infrastructure, cybersecurity in digital substations is a major focus. As per reports, there was a 400% increase in IoT malware attacks across various industries, with the manufacturing industry being the most targeted sector globally. Utilities are integrating multi-layered security frameworks, encryption protocols, and AI-driven threat detection systems to protect substations from cyberattacks.
   
• The use of Internet of Things (IoT) sensors and Artificial Intelligence (AI)-powered analytics is transforming digital substations. Utilities are deploying real-time monitoring systems that collect data from transformers, circuit breakers, and other critical assets. AI-driven predictive maintenance models analyze this data to detect potential failures, reducing unplanned outages and improving asset longevity.
   
• The digital twin technology is revolutionizing substation operations by creating a virtual replica of physical assets. Utilities can simulate different operational scenarios, optimize grid performance, and detect anomalies before they cause disruptions. Companies are increasingly investing in digital twins to improve efficiency and minimize downtime.
   
• The rising focus on clean energy sources is also bringing multiple renewable energy projects including solar, wind and hydro power. Countries including U.S., China and Canada are significantly investing in these projects, driving the demand for digital substations. In 2024, China significantly expanded its solar energy capacity, adding a record 277 GW, a 45.2% increase year-over-year, reaching a total installed capacity of 887 GW. This surge is part of China's broader strategy to increase renewable energy.
   
• Cloud-based solutions are gaining traction in the utility-scale digital substation market, enabling real-time data access, remote monitoring, and automated control. Cloud-based digital substations leverage Artificial Intelligence (AI) and Machine Learning (ML) algorithms to analyze vast amounts of operational data. By leveraging cloud computing and edge computing, utilities can process large volumes of data efficiently, enhance decision-making, and improve overall grid reliability.
   

Utility Scale Digital Substation Market Analysis

• The utility scale digital substations market was worth USD 3.3 billion in 2022, USD 3.6 billion in 2023 and USD 3.9 billion in 2024. This expansion is driven by several key factors, including the global push for smart grid modernization, increasing renewable energy integration, advancements in digital technology, and rising investments in grid automation.
   
• Based on the components, the electrical systems segment is projected to exceed the USD 2.3 billion by 2034 owing to the advancements in grid automation, increasing demand for high-voltage infrastructure, and the integration of renewable energy sources. With the expansion of electricity grids and increasing power demand, utilities are investing in high-voltage transmission infrastructure to ensure efficient energy distribution.
   
• Additionally, the communications network segment holds the overall market share of 25.2% in 2024.  Utility-scale digital substations require seamless communication between various components, including intelligent electronic devices (IEDs), remote terminal units (RTUs), and SCADA systems. The increasing complexity of modern power grids has led to the deployment of high-speed fiber-optic networks and wireless communication systems to ensure real-time data exchange, predictive maintenance, and automated fault detection.
   
• Governments and utilities worldwide are investing in smart grid projects to improve energy efficiency, reduce transmission losses, and enhance grid reliability. In 2024, the U.S. saw significant investment in smart grid technologies, with the U.S. Department of Energy (DOE) announcing a USD 2.2 billion investment to modernize the power grid, protect against extreme weather, and prepare for growing demand. This included funding for projects enhancing grid capacity and resilience.
   
• Similarly, China's State Grid also invested USD 88.7 billion in the country's power grid in 2024. China completed several UHV AC and DC lines, including a line connecting Inner Mongolia and northern Hebei with Beijing, Tianjin, Hebei, Shandong, and Jiangsu provinces. These projects will be remarkably driving the necessity of electrical infrastructure for power distribution, thereby increasing the demand for substations in the utility sector.
   

• Based on voltage, medium voltage segment is expected to grow at a CAGR of over 6.1% till 2034 due to the expansion of distribution networks, increasing integration of renewable energy sources, and rising investments in smart grid infrastructure. Governments and utilities worldwide are investing in medium voltage (MV) networks to support the growing demand for industrial, commercial, and residential power distribution.
   
• The transition toward renewable energy sources, such as solar farms and wind power plants, has led to an increased need for medium voltage substations to manage power flow fluctuations. In 2024, global wind energy experienced strong growth, with a record number of installations and a significant increase in capacity, contributing over 10% to the world's power supply, and a focus on accelerating wind energy installations to meet climate goals. The goal is to enable the demand for digital substations in the utility sectors.
   
• The increasing global electricity demand is driving the development of numerous electrical infrastructure projects. For instance, in 2024, China commenced construction on 94.5 gigawatts of coal-fired power capacity, marking the highest level of new projects since 2015. These initiatives are expected to significantly enhance the demand for utility-scale digital substations worldwide.
   
• Similarly, low voltage segments are also anticipated to cross USD 1.5 billion by 2034 due to the transition toward smart grids and automated distribution networks that have accelerated the adoption of low voltage substations. These substations, equipped with advanced sensors, IoT-enabled monitoring systems, and real-time analytics, enhance power reliability, optimize energy consumption, and improve load management.
   
• The increasing focus on grid automation, remote monitoring, and cybersecurity is driving the adoption of low voltage digital substations. Features such as cloud-based analytics, AI-driven predictive maintenance, and encrypted communication protocols are enhancing operational efficiency and grid security, further supporting market expansion.
   

• The U.S. utility scale digital substation market was reached USD 780.2 million, USD 830 million, and USD 881.3 million in 2022, 2023, and 2024, respectively. The U.S. power grid is undergoing significant upgrades to improve reliability, resilience, and efficiency. Utilities are investing heavily in digital substations to replace aging infrastructure, integrate automation, and reduce operational costs. Government initiatives, such as the Grid Resilience and Innovation Partnership (GRIP) program, have further fueled these investments.
   
• In 2024, the U.S. Department of Energy's Grid Deployment Office (GDO) announced an investment of USD 1.5 billion in four transmission projects through the Transmission Facilitation Program (TFP), an innovative revolving fund program that helps overcome the financial hurdles facing transmission development. Biden-Harris Administration also Invested USD 371 Million in 20 Projects to Accelerate Transmission Permitting Across America.
   
• Europe is also investing heavily in offshore substations to support the growing offshore wind industry. In 2024, Europe witnessed a surge in substation projects, particularly for offshore wind, with investments totaling around USD 20 billion and a focus on connecting renewable energy sources to the grid. This included new substations for offshore wind projects, as well as advancements in SF6-free gas-insulated substation technology.
   
• Asia Pacific is home to some of the world’s fastest-growing economies, including China, India, Japan, and South Korea. The region's industrial expansion, urban development, and rising commercial activities have significantly increased power consumption, driving the demand digital substations to ensure reliable electricity supply. India has set renewable energy targets, including the 500 GW non-fossil fuel capacity target by 2030, further accelerating the need for digital substations.
   
• The Middle East is undergoing a massive urban transformation, with cities expanding rapidly and new infrastructure projects being developed. Mega projects like Neom City (Saudi Arabia), Lusail City (Qatar), and Masdar City (UAE) require smart, reliable, and scalable power infrastructure, making digital substations a key component of their energy ecosystems. These substations integrate IoT, cloud computing, and artificial intelligence (AI)-driven analytics to enhance grid efficiency, prevent failures, and support real-time decision-making.
   

Utility Scale Digital Substation Market Share

Top 4 companies, including ABB, General Electric, Siemens, and Schneider Electric hold more than 30% market around the world. The dominance of these companies in the utility scale digital substation industry is driven by their technological leadership, extensive global presence, strong R&D capabilities, and comprehensive product portfolios. These companies are at the forefront of digital substation technology, integrating IoT, AI-driven analytics, cloud computing, and automation to enhance grid efficiency and reliability.
 

Utility Scale Digital Substation Market Companies

• In January 2024, Hitachi Energy innovated its substations systems, working on its pioneering digital substation technology with the all-new SAM600 3.0, a process interface unit (PIU), to help transmission utilities accelerate the adoption of digital substations. As a merging unit, SAM600 will speed the upgrade of conventional substations to digital substations. They bridge the gap by converting analog signals and digitally distributing current and voltage information throughout the substation and to the control center.
   
• In July 2024, Toshiba Group has announced a USD 6 million investment to upgrade its power transmission and distribution equipment manufacturing facilities in India. The company revealed that TTDI (Toshiba Transmission & Distribution Systems India Pvt Ltd) aims to boost its production capacity for power and distribution transformers by around 150% compared to the fiscal year 2023, with this expansion planned for the period between FY 2024 and FY 2026.
   

Major players operating in the utility scale digital substation market are:

• ABB
• Belden
• Cisco Systems
• Eaton
• Efacec
• General Electric
• Grid to Great
• Hitachi Energy
• Larsen & Toubro Limited
• Netcontrol Group
• Schneider Electric
• Siemens
• SIFANG
• Tesco Automation
• Texas Instruments Incorporated
• Toshiba
   

Utility Scale Digital Substation Industry News

• In November 2024, Kuwait is planning to build solar power plants in partnership with Chinese companies at a cost of more than USD 800 million. The IPP (Independent Power Producer) project involves Shagaya 3 and 4 solar power plants and will be a joint venture between the Kuwaiti and Chinese governments as well as a company listed on Kuwait’s bourse. Kuwait and China will control 42.5% each while 15% will be owned by a local company.
   
• In November 2024, China installed 8 GW of solar in a range of countries under its “Belt and Road” development program in 2024. As Chinese manufacturers drive down the costs of renewable power technology, they are spearheading its deployment in many developing markets that previously lacked access to affordable clean energy. Since the inception of the BRI, China has completed 156 GW of overseas power projects, including 22 GW of solar, reflecting its growing focus on clean energy.
   
• In October 2024, Germany added nearly 20 GW of renewable power capacity in 2024. According to the German Federal Network Agency, the installed renewable power capacity in Germany increased by nearly 20 GW (+12%) to nearly 190 GW in 2024. Most of the renewable capacity additions were solar (+16.2 GW to 99 GW at the end of 2024) with 2/3 of the additions consisting in rooftop installations. Onshore wind capacity grew at a slower pace than in 2023, increasing by 2.5 GW (including 0.7 GW of decommissioned capacity).
   
• In August 2024, India’s Cabinet Committee on Economic Affairs (CCEA), approved 12 new smart city projects under the National Industrial Corridor Development Programme (NICDP) with an investment of USD 3.41 billion These projects are expected to attract USD18.12 billion in investments from large industries and MSMEs, creating 1 million direct and 3 million indirect jobs.
   
• In February 2024, GE Vernova’s Grid Solutions business announced the launch of GridBeats, a comprehensive portfolio of software-defined automation solutions aimed at streamlining grid digitalization and enhancing grid resilience. Amid growing climate concerns, grid operators worldwide are responding to regulatory, consumer, and societal demands to achieve net-zero emissions and deepen their commitment to sustainability.
   
• In November 2024, At Enlit Europe 2024, Schneider Electric unveiled new innovations and partnerships, showcasing advanced technologies aimed at optimizing energy flow management in smart grids. The company demonstrated the Power Logic T300 RTU, which is virtualized on the E4S hardware platform, streamlining substation design and improving operational efficiency.
   

This utility scale digital substation market research report includes in-depth coverage of the industry with estimates & forecast in terms of “USD Million” from 2021 to 2034, for the following segments:

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Market, By Component

• Substation automation system
• Communication network
• Electrical system
• Monitoring & control system
• Others

Market, By Architecture

• Process
• Bay
• Station

Market, By Voltage

• Low
• Medium
• High

Market, By Installation

• New
• Refurbished

The above information has been provided for the following Regions and countries:

• North America
  • U.S.
  • Canada
  • Mexico
• Europe
  • UK
  • France
  • Germany
  • Italy
  • Russia
  • Spain
• Asia Pacific
  • China
  • Australia
  • India
  • Japan
  • South Korea
• Middle East & Africa
  • Saudi Arabia
  • UAE
  • Turkey
  • South Africa
  • Egypt
• Latin America
  • Brazil
  • Argentina