Medium Voltage Switchgear Market Trends

Growth Drivers

• Growing Demand for Electricity – Medium voltage switchgear are utilized not just for long-distance transmission of electrical energy, and also for regional distribution to load centers. Global electricity demand is expected to rise in 2021. According to the International Energy Agency's semi-annual Electricity Market Report for January 2022, the growth of about 1500 terawatt-hours was the biggest ever.
• Rising Initiatives for the Electrification of the Rural Region – Medium voltage switchgear is primarily used to distribute electrical energy to various electrical networks. Therefore, the electrification of rural areas is likely to drive market growth. In India, rural electrification projects began in the 1960s and have seen some success in recent years.  As of the conclusion of fiscal year 2020, over 598 thousand villages in India had been electrified, the same number as the previous year.
• Higher Expenditure in Modernizing Existing Grid–Higher implementation of new grids significantly increases the demand for medium voltage switchgear. The most important investment driver is aging infrastructure, as one-third of the EU's distribution grids are over 40 years old. By 2030, half of all networks may have crossed that level.
• Expansion of Smart Grid Networks – In numerous ways, medium voltage switchgear contributes to the peak network performance of smart grid, including feeder automation with built-in communication and local intelligence. According to the International Energy Agency investment in smart grids, worldwide is likely to be double by 2030. To achieve the Net Zero Scenario, annual investment in power systems must average roughly USD 600 billion by 2030. This is nearly quadruple current investment levels, which are roughly USD 300 billion per year.
• Loss of Electricity During Electrical Distribution – Medium voltage switchgear minimizes the voltage drop across the distribution network and thus reduces the power loss.  From the time electricity is generated to the time it is transmitted, 1-2% of its energy is lost in the step-up transformer. Furthermore, approximately 2-4% of energy is lost in transmission lines.

Challenges

• Concerns associated with cyber security – With the rise in digitization, the switchgear is becoming more interconnected. The risk of vulnerability to cybersecurity is increasing. This is likely to pose a threat to the safety and reliability of the electrical grid. Therefore, it is expected to hamper the market growth.
• Production of switchgear imposes threat to environment
• Lack of knowledge to design, install, and maintain the medium voltage switchgears