Bio-based Transformer Oil Market Trends

Growth drivers

• Energy Efficiency and Cost Saving -Bio-based transformer oil contributes to energy efficiency, translating to potential cost saving for industries. Their superior cooling properties and reduced viscosity lead to lower energy consumption, resulting in improved operational efficiency. By 2030, energy production capacity will reach over 820 GW and more than 500 GW from non-fossil fuel sources in India.
• Development of Smart Grids- With the adoption of the smart grid network concept for improving aging power assets, there has been a rising installation of smart grids. Hence, it is predicted to boost the growth of bio-based transformer oil in smart grids. In the United States, more than 100 million advanced meters were installed, as of 2021.
• Expansion in Cross-Border Electricity Trade- Trade in electricity, through the mitigation of power crises, reducing supply bottlenecks, facilitating decarbonization, and providing an incentive for bio-based transformer oil market expansion and integration, can help to lower energy prices. In Asia, where countries like India, Bhutan, Nepal, Bangladesh, Sri Lanka, Thailand, Malaysia, and Singapore have established a power grid that can help in electricity trading, the cross-border trade is growing. The demand for electricity trade across the border between South Asia and India should be improved by the evolution of the power sector in India.

Challenges;

• High Cost of the Oil Bio-based transformer oils offer long time cost savings through improved energy efficiency and reduced maintenance, their initial cost can be a deterrent for some companies. At present, the production of bio-based oil might involve higher expenses due to limited economies of scale and the procurement of renewable feedstocks. The sourcing and availability of renewable feedstocks for bio-based transformer oils present a significant challenge. Some rely on specific crops or raw materials, which can lead to supply chain disruptions and volatility in prices.

• Availability of Inexpensive Substitute
• Lack of Awareness