Switchgear Market to Reach Valuation of USD 92.5 Billion by 2028 - Increasing Demand for Switchgear Market for replacement of aging power infrastructure to Drive the Market Growth

Vantage Market Research

Jun 06, 2022

From the period of 2022 to 2028, the Global Switchgear Market is expected to reach USD 92.5 Billion in terms of revenue, growing at a Compound Annual Growth Rate (CAGR) of 5.2%.

Switchgear is an electrical component that controls, monitors, and regulates a circuit. It ensures operating safety, cost-effectiveness, and continuity in a variety of residential, commercial, industrial, and utility applications. As transmission and distribution networks have developed, so has the need of switching equipment. The fast development of electricity in rural areas, combined with expanding energy production, has increased demand for a wide range of electrical equipment. Increased regional government goals for delivering energy to rural areas and rising investments in this industry are two important Switchgear Market trends that are projected to contribute to market expansion.

Key Highlights from the Report

  • On the basis of Insulation, the market is segmented into AIS and GIS. During the projected period, the air-insulated Switchgear (AIS) segment is expected to contribute the most to the Switchgear Market. Air-insulated Switchgear is one of the most prevalent types of medium-voltage Switchgear today. They are made up of a combination of electrical disconnector switches, circuit breakers, and earth switches that are used to regulate, isolate, and safeguard electrical equipment that is insulated by air. Transmission and distribution, manufacturing and processing, infrastructure and transportation, oil and gas, and other industries also employ them. AISs are predicted to lead the market since they are more cost-effective, pollution-free, easy to construct, and maintain than GISs.

  • Asia Pacific is the fastest regional segment in terms of growth. The presence of considerable potential for large industrial units, as well as the rapidly growing residential and commercial sectors, is expected to contribute to regional growth. Due to the increased requirement for electric power transmission and distribution as well as electrification projects, developing countries such as China, India, and South Korea are experiencing unsustainable energy demand. According to the India Brand Equity Foundation (IBEF), rising electrification will increase power consumption in India to 1,847 TWh by 2022. Japan, Australia, and Southeast Asian countries are other important countries in Asia Pacific, and they will contribute to the industry's growth rate in the next years.

Market Dynamics:

Aging Power Infrastructure

The requirement for a robust and reliable T&D network has grown as energy demand has increased. According to the Department of Energy and the North American Electric Reliability Corporation, uninterrupted power can only be maintained by a system that can handle sudden power spikes and drops. The United States has more power outages than any other developed country, with disruptions lasting more than an hour and increasing rapidly in recent years, costing American businesses some USD 150 billion each year. The main causes of the rising number of blackouts include old infrastructure, a lack of investment, and a lack of a defined program for grid modernization. Switchgear, with the help of monitoring technologies, informs the maintenance staff when aged and over-used equipment is about to fail, allowing them to make better decisions by providing real-time data that reveals faults and chances for improvement.

High Cost of Switchgear

Switchgears disconnect electric circuits from the power supply to allow for safe maintenance or fault correction. Switchgear is used by energy customers to protect electrical equipment from surges. The Switchgear is expensive due to all these features. Control systems, such as control panels, current transformers, potential transformers, protective relays, and associated circuitry that monitor, control, and protect the power-conducting components, and power-conducting components, such as switches, circuit breakers, fuses, and lightning arrestors, that conduct or interrupt the flow of electrical power. These components combine to form a sophisticated and costly Switchgear solution. The capital-intensive nature of Switchgear may operate as a barrier to market expansion.

Over the projection period, Asia Pacific is expected to have tremendous growth. The upgrading of the old electrical grid infrastructure and rising power demand in the region are two major reasons contributing to the region's supremacy. Some of the primary drivers driving growth are the blooming infrastructure construction for renewable energy sources, the growing market for grid modernization, and the replacement of obsolete installations, as well as capacity upgrades. The market demand for Switchgear is being driven by rising electrical demand due to expanding population, economic expansion, urbanization, industrialization, and rural electrification programs.