About the Report
The global sales for shunt reactors witnessed a minor slowdown in the Covid-19 crisis as all the factories were closed and supply of only basic necessity goods was permitted. Since the lockdown has been lifted up to improve economic conditions, the manufacturing companies are trying hard to gain traction and attract customers globally through innovative launches and technological upliftments in 2021.
Major manufacturing companies including ABB, Siemens, Crompton Greaves, General Electric , Zaporozhtransformator, Toshiba (Japan), Mitsubishi (Japan), and Nissin Electric (Japan).are investing in the establishment of a strong distribution network to remain competitive in the market. They are adopting business strategies such as sales contracts, strategic alliances, acquiring technical expertise, product approvals, patents and events, joint ventures, partnership agreements, collaborations, digital marketing, mergers and acquisitions, capacity utilisations, technological advancements etc to lead the global market for shunt reactors with largest market share.
For instance, Hitachi ABB launched Variable shunt reactors which are economical means to improve voltage stability and power quality under time-varying load conditions. Siemens AG has acquired order from Semco Maritime for supply of key electrical equipment for electrical service platform (ESP) at 1.6-GW Mayflower Wind offshore wind farm project. The contract comprises high-voltage equipment such as integrated conditioning monitoring system, three shunt reactors, and gas-insulated switchgear (GIS).
North America is predicted to rule the global market for shunt reactors through 2030 owing to increasing demands from the automobile industry. Presence of leading manufacturing companies that produce and distribute superior class shunt reactors globally contributes to make China a leading region with the fastest growing CAGR rate. The government initiatives are propelling growth in the Asia Pacific excluding Japan (APEJ) shunt reactor market. Further, the rising innovations are creating immense opportunities for the key players to extend their presence throughout the world.
- Oil immersed shunt reactors account for leading revenue share as they are highly compact, cost-effective, and ideal for high-voltage transmission lines
- Fixed shunt reactors to remain top-selling category over following decade
- Demand for three-phase shun reactors to remain high
- Market players to tap into North America for lucrative investment opportunities through 2030
Conspicuous Investments in Upgrading T&D Networks to Boost Demand
Energy security is prerequisite for countries striving to make overall progress. As such, power transmission and distribution (T&D) networks play pivotal role in overall economic development of countries. In an effort to inch towards sustainability goals, governments across the globe are renewing their commitment to establish robust energy infrastructure,
Existing T&D networks utilized in majority of developed regions bank on aging infrastructure and obsolete technologies that struggle to fulfil current and future growing demand. In developed regions such as the US, the UK, and Germany, nearly 7 out of 10 transformers and transmission networks age over 25 years old and reaching their service period.
The twin trends of long-run under-investments in T&D infrastructure and surging need for reliable supply of power have put pressure on grids, making them highly vulnerable. As such, in order to keep grid breakdown or power outages at bay, substantial investment is essential for stepping up aging T&D grids including, shunt reactors. As energy requirements continue to increase, demand for supporting infrastructure is increasing.
Electric utilities will invest around US$ 3.2 Tn globally in new and replacement T&D infrastructure, as per recent surveys. This investment in infrastructure will be paramount, given aging assets, rising electricity demand, and new power generation projects including, periodic renewable resources that are straining the grids. As a result, conspicuous investments in T&D infrastructure are likely to augur well for global shunt reactor market over forecast period.
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Variable Shunt Reactors to Outpace Fixed Variants
Transmission systems are susceptible to regular or periodic load variations. Conventionally utilized in transmission and distribution systems, fixed shunt reactors continue to generate greater total returns to shareholders (TRS). However, these shunt reactors will fade in coming years due to cost-associated restraints.
On the flip side, variable shunt reactors (VSR) are cost-effective means to enhance power quality and voltage stability under time-varying load conditions. In addition, VSRs enable customers to continually adjust the compensation, as loads differ over time.
VSRs have emerged as lucrative alternative to fixed reactors in situations wherein power quality is paramount. They possess regulation capacity and can connect with other regulating devices including, static var compensators (SVC).
VSRs derived from transformer tap changers possess regulation speed in the order of minutes between extreme positions. As load variations happen gradually – largely in the order of hours or further – the tap changer technology turn out to be the most economical and reliable technology for controllable shunt reactors.
VSRs are highly advanced in stabilizing voltage fluctuations through large transmission networks, as such, their demand is skyrocketing. Three-phase VSRs, in particularly, are seeing huge demand owing to rising need for high-voltage transmission cables and lines. ABB, for instance, has installed three-phase VSR with 120-200Mvar at 420 kV in Italy.
The variable shunt reactor market is experiencing rapid growth compared to its fixed counterpart as VSRs are considered more capable to control voltage amid high-voltage power transmission cables or lines. FMI report finds that the variable shunt reactor market is likely to grow at double-digit CAGR through 2030.
Market in APEJ to Make Quantum Leaps
North America is currently at the forefront of global shunt reactor market, primarily driven by well-established transmission and distribution industry. The region has been highly focused on transforming outdated and inadequate power and supply network for effective production of electricity over the past few years.
Government in the US has comprehensively invested in stepping up existing infrastructure, resulting in increasing demand for shunt reactors in the country. That said, the COVID-19 pandemic has put dent on revenue pool of shunt reactor market in North America as shuttered businesses and industrial operations translate into reduced electricity demand.
However, FMI finds that the regional market revenue is poised to spike as gradual easing of restrictions encourage industrials to resume their operations. The Asia Pacific excluding Japan (APEJ) shunt reactor market is experiencing meteoric growth, largely driven by government-backed initiatives to offer power throughout off-grid areas.
While China’s investment in power generation projects is coming to pre-crisis growth levels, investment in power grid projects is declining slower. In addition, electricity consumption in China is slated to surge 7.1% and 6.8% y-o-y during Q3 and Q4 of 2020, respectively, as the COVID-19 pandemic eases.
Daily electricity consumption in India has reduced by 26-27% since the enactment of nationwide lockdown, due to temporary suspension of non-essential manufacturing facilities. While the country is seeing downturn in electricity demand and investments in the sector during 2020-21 amidst the COVID-19-led disruptions, however, recovery is projected from 2021-22, says FMI.
Moving ahead, energy needs are reaching new scales in Europe, especially in the UK which is among primary industrial countries in the region. Recent data suggest that final electricity consumption of the UK industrial sector is anticipated to reach 5, 928 thousand metric tons of oil equivalent by 2035.
Shunt Reactor Manufacturers – Players to Race towards Grabbing Contracts and Agreements for Better Margins
- Players in shunt reactor market are focusing on developing similar equipment and, as such, giving rise to cut-throat competition with their peers. Innovations and enhanced voltage protection solutions will ascertain the prominence of leading manufacturers in key growth regions. Market players are striving to secure contracts as well as enter into agreements in order to gain competitive edge.
- Zaporozhtransformator PJSC has signed agreement with Tokmak Solar Energy Ltd., for delivery of its transformer - TRDN-32000/150-Y1.
- Siemens AG has acquired order from Semco Maritime for supply of key electrical equipment for electrical service platform (ESP) at 1.6-GW Mayflower Wind offshore wind farm project. The contract comprise of high-voltage equipment such as integrated conditioning monitoring system, three shunt reactors, and gas-insulated switchgear (GIS).
- Trench Group – a multi-national power engineering company - has acquired contract to deliver and set up highest voltage (420 kV) air-core shunt reactor in the world to Germany-based transmission system operator.
- Through its power grids business, ABB Ltd., has entered into a 5-year contract with Interconexion Electrica SA ESP (ISA) for delivery of critical power machinery for ISA’s operations in South America.
Smart Grid Technology to Define the Way Forward
Electricity distribution networks are undergoing step-change transformation, with emergence of smart grid technologies triggering advances towards enhanced services. Power systems incorporate transportation of loads of gigawatts (GW) of power over long distances, as such demand for smart machinery is essential for accurate monitoring and timely fault rectification.
Investments in smart grid technologies are surging majorly in developed regions which are stepping into the new age of load management and power supply. The technology offers opportunity to manufacturers of VSRs, as VSRs in smart grids will ensure proper flow of active power as well as balance reactive power.
As such, players turning to development of VSRs are well-placed for outsized returns in near future.
- Base year considered - 2019
- Historical Period- 2015 - 2019
- Forecast period - 2020 - 2030
- Market Value in 2019 -
- Segments covered - Product, phase, rating, application and region
- Regions Covered -North America, Latin America, Western Europe, Eastern Europe, Asia Pacific excluding Japan, Middle East & Africa (MEA), and Japan
- Key Companies-ABB Ltd., Fuji Electronic Co. Ltd., General Electric, Hyosung Corporation, Nissin Electric Co. Ltd., Zaporozhtransformator PJSC, Siemens AG, and Toshiba Corporation.
Key Questions Answered in the Report:
- Which application area will hold leading share in shunt reactor market globally and why?
- What are the factors propelling the global shunt reactor market?
- What will be the value size of shunt reactor market by 2030?
- Who are the leading manufacturers in the shunt reactor market?
- Which trends and innovations are expected to shape the global shunt reactor in coming years?
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Does the market report provides detailed background of mentioned players?
Apart from the market players covered in the report, we offer insights about other players that are associated with the global compact loaders market.
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Key Segments Covered
- Air-core dry Type
- Oil Immersed
- Single Phase
- Three Phase
- Fixed Shunt Reactor
- Variable Shunt Reactor
- North America
- Latin America
- Western Europe
- Eastern Europe
- Middle East & Africa (MEA)