The global synchronous condenser market was valued at $570 million in 2020 and is expected to grow at a CAGR of 3.2% during the forecast period of 2023 to 2030. A synchronous condenser is a device that produces reactive power that is 90 degrees out of phase with real power. A synchronous condenser's shaft, like that of a synchronous motor, can freely revolve. It is used to control electric power networks by delivering or absorbing reactive power to the regulated grid's voltage. It can be started with the help of beginning methods such as a static frequency converter and a pony motor. Depending on the type of load, reactive power rating, and client needs, synchronous condensers use air cooling, hydrogen cooling, or water cooling. The biggest commercial limitation is the synchronous condenser's high maintenance and equipment expenses. However, among the key factors driving the growth of the synchronous condenser market are power factor correction, the expansion of high-voltage direct current (HVDC) networks, advances in condenser technology, and the ongoing transition toward renewable energy resources.
Because of the alarming rate of depletion of fossil fuels, governments throughout the world are looking for alternative energy sources that may not only supply energy demands but also help to prevent environmental deterioration. This has resulted in the expansion of renewable energy infrastructures, such as solar and wind power facilities. However, these power plants usually struggle to provide high-quality power while maintaining steady grid voltage. To address this issue, an increasing number of synchronous condensers are being developed in these power plants to assure stable operations and maintain voltage stability with weak grids. This is driving up demand for synchronous condensers.
Increasing government investments in the building of new HVDC networks are also contributing to the growth of the synchronous condenser market, which is predicted to continue during the forecast period. Countries are constructing a slew of new HVDC projects to power their citizens. In electrical power transmission networks, synchronous condensers help to regulate reactive power. The increasing use of synchronous condensers in HVDC systems is expected to generate future growth prospects for the global synchronous condenser market.
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Mining companies usually operate with poor network power quality and low short-circuit capacity due to their distant locations. Mining sector operators are adding power-quality equipment, such as synchronous condensers, to address this issue. These products improve power factor correction and thus voltage regulation. Furthermore, they ensure a consistent supply of energy free of fluctuations that could otherwise damage mining equipment. Thus, the mining sector's expansion and the rising trend of installing synchronous condensers to address power system concerns in the mining industry are expected to drive the market for synchronous condensers over the forecast period.
The new segment held the largest market share by type in 2021, owing to increased demand for reactive power compensation from electric utilities such as transmission networks, power plants, and other industrial applications. Furthermore, the benefits of synchronous condensers, such as power factor correction, reactive power compensation, grid stability, and voltage regulation, are expected to drive the global synchronous condenser market during the forecast period. The global expansion in the number of power projects and vehicle charging stations is a significant factor in the increased sales of new synchronous condensers. Future sales of new synchronous condensers are expected to be driven by an increase in government investment in the construction and extension of power production and transmission facilities.
The air-cooled segment dominated the global mobility market in 2021, owing to increased demand for synchronous condensers from high-voltage DC systems, wind/solar power production, synchronous condenser upgrading, and other reactive power compensation applications in electric utilities. The use of an air-cooled system in a synchronous condenser simplifies operation and maintenance. This is expected to drive the expansion of this market sector in the coming years.
In terms of cooling technologies, the static frequency converter segment accounted for the lion's share of the global synchronous condenser market in 2021. This is because heavy industries and projects such as dams, power plants, power networks, refineries, and mills are expanding. Furthermore, in the approaching years, the global expansion in hydropower projects will be the key driver of the static frequency converter-based synchronous condenser. Static frequency converters provide higher control, greater precision, and excellent dependability when starting synchronous condensers. They are unaffected by variations in supply voltage and load. Furthermore, these goods are less noisy and have low installation costs. The growing use of static frequency converter-based synchronous condensers in various end-use industries is likely to fuel the growth of the synchronous condensers market during the forecast period.
In terms of application, up to 100 MVAR segments had the biggest market share in 2021. This is due to an increase in the demand for power factor correction and reactive power compensation in industrial applications with multiple inductive loads. Furthermore, the key benefits of using synchronous condensers in utility applications are increased short circuit megavolt ampere (MVA), high response excitation system, high overload capability, prolonged service life, and improved reliability, which are expected to drive market growth over the forecast period. Because of their low cost, ease of installation, and high efficiency, less than 50 and 50 to 80 MVAR synchronous condensers are gaining appeal among end customers in a number of industries. Leading manufacturers have also shifted their focus to the production of synchronous condensers with set power ratings, notably devices ranging from 50 to 80 MVAR.
The electrical utility sector maintained the largest market share in 2021, owing to the increasing need for energy and related products, which increases demand for grid infrastructure. Furthermore, the rapid adoption of electric vehicles has resulted in an increase in charging stations, which serves as an important growth factor and gives new opportunities for the integration of renewable electricity in charging stations. By absorbing or producing reactive power as needed, the synchronous condenser can be used to improve the power factor in these stations. This is expected to enhance demand for synchronous condensers in the coming years. Synchronous condensers are increasingly being used in grid stations to increase power factors by absorbing or producing reactive power. They improve grid stability and reduce electric utility voltage swings. The growing number of electric grids, solar farms, and electric car charging stations is expected to enhance demand for synchronous condensers in the future years.
North America is expected to be the largest market throughout the projection period. North America's aging energy grid may increase the chance of blackouts. As a result, the governments of various countries in this region are working hard to upgrade and replace aged infrastructures in order to improve grid dependability and resilience and build intelligent electrical networks. Meeting energy-efficiency targets, complying with government carbon regulations, and integrating varied scattered generation sources into the grid are all current difficulties for the North American power sector. Regionally, North America will continue to be the most profitable market for synchronous, accounting for 28% of the market by the end of the projected period. Rapid industrialization, depletion of fossil fuels, and rising electric vehicle adoption have all contributed to a significant increase in renewable energy use in the United States in recent years. The United States generated around 63,194.0 GWh of renewable electricity in 2019, according to the International Renewable Energy Agency (IRENA).
The United States government is investing in increasing renewable energy generation capacity. The US Agency for International Development (USAID) and the Inter-American Development Bank (IDB), for example, will contribute $6.5 million towards the development of a new solar power plant in the Caracol Industrial Park in 2021. This presents significant growth potential for the synchronous condenser industry. Furthermore, the presence of market leaders and the rise of the mining industry are expected to boost the synchronous condenser market in the United States.
Because of the presence of various firms in both developed and developing countries, the global market for synchronous condensers is fragmented. The synchronous condenser market is highly competitive. The product portfolios of the top corporations are constantly updated in order to preserve a competitive advantage. To gain market dominance, top market competitors use both organic and inorganic methods such as mergers, partnerships, new product launches, collaborations, and acquisitions.
Global leaders in the synchronous condenser business include ABB, Ltd., Andritz, Eaton Corporation Plc, Fuji Electric, General Electric, Ideal Electric Power Co., Mitsubishi Electric Corporation, Siemens Energy, Voith GmbH & Co. KGaA, and WEG Group. Modern Power Systems, Toshiba Corporation, Brush Group, Sustainable Power Systems, Inc., Power Systems & Controls, Inc., Ansaldo Energia, and Power Systems & Controls, Inc. are all still involved in the synchronous condenser market.
