The global flexible AC transmission systems market (FACTS) is expected to grow at a CAGR of 8.5% during the forecast period of 2023 to 2030. The expanding benefits that FACTS have to offer, the expansion of transmission lines, the growing emphasis on energy generation through the use of renewable sources, and the rising demand for STATCOM devices to manage voltage are all factors that are driving the growth of the market for FACTS. In addition, prospects for FACTS producers can be found in the growing investments in transmission networks as well as in potential opportunities in APAC. The use of a flexible AC transmission system can boost system stability, provide dynamic reactive power assistance, and control both real and reactive power. This guarantees that the machine operates effectively and improves the use of the system. Due to the advancement of electric power transmission systems across developed and emerging areas, including North America, Europe, and Asia-Pacific, the global market for flexible AC transmission systems is anticipated to experience a considerable growth rate in the coming years. Demand for flexible AC transmission systems is being fuelled by an increase in the need for controllability of power systems in industries such as oil and gas, railways, and electric utility. This demand is helping to drive the global market.
Integration Of Increasing Amounts of Renewable Energy Sources into Power Grids
The generation of electricity from renewable sources such as wind, hydro, and solar is seeing an increase in global attention as countries work to meet their carbon emission reduction goals. In order to satisfy the expanding requirement for electrical power in developed regions such as the Americas and Europe, there is a developing requirement for improved power transfer capabilities on the transmission lines that are already in place. It is necessary to make changes to the way power is generated in order to ensure that it is generated in a manner that is clean, sustainable, and kind to the environment. In order to preserve the system's stability, as well as the quality and dependability of the power supply, FACTS are being utilised in the process of integrating renewable energy sources into transmission networks.
The shift to clean energy is happening at a quick rate as a direct result of governments all over the world announcing their targets for the reduction of emissions and the neutralisation of carbon. The global energy shift is being driven in large part by a number of variables, one of the most important of which is the falling cost of distributed energy resources (DERs). The World Energy Transition Outlook 2023 published by IRENA indicates that the global energy transition is a long way from being on the right track. To achieve the worldwide goals, renewable energy sources would need to experience a huge expansion across all industry categories, rising from their current share of 14% of total energy to around 40% of total energy in 2030. According to the projections made by the Intergovernmental Panel on Climate Change, the global annual additions of renewable electricity will triple by the year 2030. (IPCC). The aggressive climate targets that were declared at COP 26 are likely to be the driving force behind the acceleration in the expansion of renewable capacity over the following five years. This acceleration will account for over 95% of the increase in global power capacity through 2026. When compared to the levels in 2020, the stock of renewable electricity had expanded by 9.1% by the end of 2021, with solar and wind capacity additions accounting for the majority of the total renewable capacity growth. All of the major regions of the world have seen an increase in the number of new solar capacity installations, which has now surpassed the total wind energy capacity worldwide. Wind farm installations continued to grow in 2021, but at a slower rate than in the previous year (+93 GW compared to +111 GW). It is anticipated that the capacity of renewable electricity sources will expand by more than 60 % between the years 2020 and 2026, reaching more than 4800 GW. This is equivalent to the total power capacity that the world's fossil fuels and nuclear power plants currently have. The expansion of the use of renewable energy sources and the integration of those sources into the grid would make it considerably more challenging to maintain the grid's stability and reliability. Because FACTS provide the optimal answer, it is anticipated that demand for FACTS will continue to be strong in the years to come.
Development In Power Transmission Systems and The Controllability of Power Systems.
The global market for flexible AC transmission systems is expected to experience a remarkable expansion in the coming years as a result of an increase in the demand for advanced controllability of energy systems as well as an increase in investments made toward the development of power transmission systems. It is anticipated that these factors would drive demand for FACTS devices because these devices play an important part in the support of reactive power and contribute to the stability of the system. Additionally, FACTS transmission solutions can support fulfilling the rising global demand for transmission systems to transfer, accommodate, and carry bulk electrical energy. This demand is anticipated to propel the growth of the market in the review time period. FACTS transmission solutions can help to fulfil this demand. It is anticipated that the minimization of harmonics, rapid voltage regulation, increased energy supply, and rapid amortisation will be the primary drivers of market growth for flexible AC transmission systems over the time period of the prediction.
Development of Improved Methods for the Transmission of Electric Power
The deterioration of the transmission and other networks that make up the power system over time causes significant amounts of power loss and reduces the system's overall usability. The demand for flexible AC transmission systems is being driven by an increase in the demand for electrification across both industrialised and emerging nations.
Need for High Initial Investments Limiting the FACTS Applications
The significant increase in capital expenditures that must be made in order to implement flexible AC transmission systems is one of the primary factors that are restraining the expansion of the market. The relatively large initial cost commitment that FACTS requires in comparison to its competitors serves as a barrier to its widespread implementation around the world. However, when the cost is evaluated in comparison to the anticipated benefits, the financial benefits and return on investment far outweigh the initial investment cost. Some examples of these benefits and returns include additional annual sales as a result of increased power transfer capacity provided by FACTS. The effect of this constraint is now minimal, but it is anticipated that it will become less of a factor in the coming years as FACTS devices continue to shrink in size and become less expensive. Additionally, manufacturers are experiencing challenges with the large-scale installation of FACTS devices, which is expected to be a factor that impedes the expansion of the market in the foreseeable future. It is anticipated that the growing demand for renewable energy sources would present important opportunities for financial investment in the expansion of the flexible AC transmission system industry.
Limitations In Terms of Both Size and Communication
In comparison to their conventional equivalents, FACTS devices provide a greater number of advantages. These advantages include higher stability, high dependability, high power quality, benefits to the environment, more flexibility, and economical advantages. However, in order to achieve a successful rollout of FACTS devices on a broad scale, a number of challenges must first be overcome and resolved. The correct size and configuration of FACTS devices play an essential part in determining the total cost of the device. This is because the size of FACTS is directly linked to the cost of the whole system as well as the performance qualities that are required by the user.
Series Controller Units is Expected to Offer Significant Opportunities During the Forecast Period
A compound annual growth rate (CAGR) of around 6% is anticipated for series controller units during the forecast period of 2023 to 2030. Increasing transmission capacity, decreased installation time, and enhanced system stability is the primary factors that are driving growth in the series FACTS market. In addition, the trend among consumers toward a safer living environment, in conjunction with the extended life expectancy of energy infrastructure, will further stimulate the industry outlook. This predominance is primarily attributable to the extensive use of the series compensation type to improve the power transfer capabilities of both new transmission lines and existing infrastructure. In addition, cutting-edge series compensation systems have the potential to make a significant contribution to the enhancement of the quality and stability of energy transmission lines. It is anticipated that the growth of the market will be fuelled in the foreseeable future by this factor.
The need for shunt systems is being driven in part by the fact that they have a lower cost of installation in comparison to their available equivalents, increased efficiency, and higher ratings across distribution circuits. These are just a few of the vital qualities. In addition, the absence of an efficient electric network across developing nations, along with a paradigm shift toward the renovation of existing infrastructure, has further contributed to the creation of a favourable business environment.
STATCOM Dominating the Product Segment
The static synchronous compensator (STATCOM) segment held the largest revenue share in 2021 due to the power factor and enhanced stability across utility systems. The capacity to provide capacitive reactive power during abnormal voltage drops and faults, together with a quicker response time that is contingent on thyristor firing, are the primary elements that are favouring the product's increased market share.
A favourable environment has been created for SVC units as a result of their capacity to control voltage variations, power oscillations, and resonance for unbalanced loads across the variable active or reactive supplies. The increasing integration of electric gadgets that are modern, energy efficient, reliable, and secure as well as fire resistant has further stimulated the growth of the flexible AC transmission systems market.
Market, By Voltage: 220KV to 660 kV units, Remains a Key Market
The incorporation of sustainable energy infrastructure has prompted utilities and installers to concentrate on refurbishing the existing electrical network. This is due to the fact that sustainable energy infrastructure will be required. For the purpose of withstanding the volatility across sustainable networks, conventional systems are currently undergoing development and improvement that is dependent on resonating frequencies and bandwidth. The growth of the overall industry will be boosted as a result of positive consumer and regulatory attitudes toward the implementation of renewable electricity networks.
The retrofitting of small-scale industrial platforms and large-scale commercial establishments across developing regions has provided a significant impetus for the growth of 220 kV to 660 kV units. In addition to this, suburban migration results in the development of big residential complexes and multi-story apartment buildings, which increases the market share of the product. The increasing reliance on huge sectors, such as industrial facilities and power generation, has further nourished the expansion of the FACTS market.
Market by Application, Dynamic Application to Witness Considerable Growth
An increase in thermal loading, regulation of power flow and loop flow, reduction in short circuit level, and post-contingency voltage management are the few essential elements that are positively affecting the growth of the FACTS controller across steady state applications. In addition, the worldwide FACTS market will benefit from rapid switching responsiveness, enhanced voltage stability, reduced losses, and increased dependability in power systems.
Because of their efficient adoption to give voltage control, transient stability enhancement, SSR elimination, and oscillation damping, the dynamic application market is expected to witness considerable growth during the forecast period. The current variations, imbalanced load, and harmonic volatility circumstances have been continuously preventing emerging nations' power grids from being sustainable and preventing such governments from realising revenue. Consequently, an increase in peak load demand in tandem with a shifting inclination toward an efficient grid network will further boost the adoption of technology.
Market by End Use: Transportation Industry Led the Market Revenues
Because utilities, government agencies, manufacturers, product suppliers, and other dealers of a similar nature depend heavily on the transportation industry for the shipment of their processed products, the transportation industry held a dominant revenue share in 2021. As a result, there has been a recent uptick in the need of maintaining a secure and dependable energy supply along these transport peripherals. In addition, rapid technological advancements as well as an industry shift towards the incorporation of electrically powered transportation units, yards, and premises will support the overall expansion of the business.
Installation of electrical networks has been favoured by the government and regulatory schemes, and these programmes have given preference to utility-assisted grid infrastructure. The potential of the business has been bolstered thanks to constructive government instructions about the electrification of rural areas and the implementation of decentralised microgrids in a variety of distant and isolated locations. In addition, the adoption of environmentally friendly electrical infrastructure in emerging regions will stimulate business dynamics, and this adoption will be positively influenced by investments made by local regulatory institutions and authorities, such as the world bank and other similar financial organisations.
The oil and gas industry vertical accounted for the second position in the global flexible AC transmission market share in 2021. This industry vertical is anticipated to rise at the highest CAGR of 8% throughout the forecast period of 2023 to 2030. It is anticipated that an increase in the employment of FACTS devices to maintain voltages during conditions of variable load will fuel the expansion of the market in the foreseeable future. The adoption of FACTS in the oil and gas industry for the purpose of voltage stabilisation is being driven in part by the fact that these systems are not only highly advanced but also save both time and money when it comes to the process of keeping the power consistent. It is anticipated that this factor will be a primary driver of market expansion during the next few years.
Europe Dominated the Global Share
Europe registered the largest revenue share in 2021. The demand for energy in European countries is increasing as a result of both the higher levels of industrial production and the growing populations in such countries. As a direct consequence of this, FACTS is expanding throughout this region. In addition, government rules in Europe concerning carbon-free power transmission and grid coding are anticipated to be a primary driver of the FACTS market in this region. The United Kingdom is one of the most significant buyers of FACTS devices in all of Europe. The increasing demand for power, in conjunction with the rapid improvement of technology, necessitates the installation of a reliable electrical grid system. This, in turn, fuels the expansion of the FACTS market in the UK. In addition, the second version of the FACTS device, known as STATCOM, is mostly used in the United Kingdom by a variety of businesses because of the several advantages it offers, including cost-effectiveness and voltage regulation.
By the year 2025, it is anticipated that the U.S. FACTS market will exceed U.S. $ 268 million USD. The situation in the sector has improved as a result of an increase in demand brought about by an increase in the flow of funds toward the development of a long-distance grid network and the restoration of local electric infrastructure.
The Asia-Pacific flexible AC transmission system market is expected to register the highest CAGR during the forecast period, thanks to an increase in government expenditure to build smart grids and an increase in investment on electricity generation by renewable energy resources. This is expected to make the Asia-Pacific flexible AC transmission system market the market with the highest revenue by the end of the forecast period. In addition, there has been an increase in investments in high-speed trains coming from developing countries such as China, India, and Japan, which is anticipated to offer attractive potential for market expansion.
Market Largely Dominated by Big Players
ABB, Adani Group, Alstom, cgglobal.com, Eaton, General Electric, HYOSUNG, Mitsubishi Electric Corporation, NR Electric Co., Ltd., and Siemens are some of the key participants in the global flexible AC transmission system market that have seen the most significant market presence and share. In order to strengthen their position as market leaders in the global flexible AC transmission system industry, these major players are focusing their attention on both organic and inorganic growth strategies, such as product development and mergers and acquisitions.
Historical & Forecast Period
This study report represents analysis of each segment from 2022 to 2032 considering 2023 as the base year. Compounded Annual Growth Rate (CAGR) for each of the respective segments estimated for the forecast period of 2024 to 2032.
The current report comprises of quantitative market estimations for each micro market for every geographical region and qualitative market analysis such as micro and macro environment analysis, market trends, competitive intelligence, segment analysis, porters five force model, top winning strategies, top investment markets, emerging trends and technological analysis, case studies, strategic conclusions and recommendations and other key market insights.
Research Methodology
The complete research study was conducted in three phases, namely: secondary research, primary research, and expert panel review. key data point that enables the estimation of Flexible AC Transmission Systems (FACTS) market are as follows:
Market forecast was performed through proprietary software that analyzes various qualitative and quantitative factors. Growth rate and CAGR were estimated through intensive secondary and primary research. Data triangulation across various data points provides accuracy across various analyzed market segments in the report. Application of both top down and bottom-up approach for validation of market estimation assures logical, methodical and mathematical consistency of the quantitative data.
| ATTRIBUTE | DETAILS |
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| Research Period | 2022-2032 |
| Base Year | 2023 |
| Forecast Period | 2024-2032 |
| Historical Year | 2022 |
| Unit | USD Million |
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Voltage
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Application
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End Use
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Region Segment (2022-2032; US$ Million)
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Key questions answered in this report
