How Has the Digital Substation Market Evolved Historically and What is its Current Size?
The digital substation market has seen considerable growth due to a variety of factors.
• The market size for digital substations has experienced substantial growth in the past few years. It is projected to increase from $7.85 billion in 2024 to $8.55 billion in 2025 with a compound annual growth rate (CAGR) of 8.9%.
The growth during the historic period is primarily due to an increased demand for energy, more stringent grid monitoring necessities, operational and maintenance cost savings, and regulatory compliance obligations.
What is the Forecasted Market Size and CAGR for the Digital SubstationMarket?
The digital substation market is expected to maintain its strong growth trajectory in upcoming years.
• In the coming years, the digital substation market size is predicted to experience swift growth, with projections indicating it will reach $14.45 billion by 2029, boasting a compound annual growth rate (CAGR) of 14.0%.
This reported growth throughout the forecast period can be credited to factors such as grid decentralization, the electrification of transportation, standardization and interoperability, along with increasing urbanization and electrification. Predominant trends within this forecast period are also expected to include the rising implementation of IoT and sensors, edge computing for instantly processing data, the use of artificial intelligence and machine learning applications, as well as remote monitoring, maintenance, and resilient communication networks.
What Are The Primary Growth Drivers In The Digital Substation Market?
The digital substation market is set to expand, driven by the growing demand for electricity. Digital substations play a critical role in replacing conventional copper cables with cutting-edge fiber optics transmitters that transform electrical pulses into optical signals. These substations are utilized in power grids and transformers to mitigate losses during electrical transmission. For example, global electricity demand is projected to surge at a rapid 3% annually from 2023 to 2025, as per the International Energy Agency, faster than the growth seen in 2022. This projected rise epitomizes the ongoing recovery of industrial and economic operations, and an increasing need for energy-intensive services and technologies across the globe. Hence, the surge in electricity demand is fueling the growth of the digital substation market.
What Is The Segmentation Of The Global Digital Substation Market?
The digital substation market covered in this report is segmented –
1) By Voltage Level: Low, Medium, High
2) By Type: Transmission, Distribution
3) By Module: Fiber Optics Communication Network, Supervisory Control And Data Acquisition, Hardware
4) By Industry Vertical: Power Generation, Metal & Mining, Oil & Gas, Transportation & Logistics, Defense & Aerospace, Process & Manufacturing, Other Industry Verticals
Subsegments:
1) By Low Voltage: Distribution Automation, Smart Metering Solutions, Protective Relays
2) By Medium Voltage: Circuit Breakers, Voltage Regulators, Substation Automation Systems
3) By High Voltage: Transformer Monitoring Systems, High Voltage Circuit Breakers, Advanced Protection And Control Systems
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What Emerging Trends Are Shaping The Digital Substation Market Landscape?
The trend of strategic partnerships and collaborations between companies is increasingly shaping the digital substation industry. As the digital transformation continues to evolve rapidly, digital solution providers are teaming up to remain adaptive and ahead. For example, Hitachi Ltd, an electronics company from Japan, formed a collaboration with East Japan Railway Company in September 2023 to build a comprehensive digital substation system by 2025. This innovative technology would facilitate double configuration of transmission lines along with protection and control functions on substation premises, ensuring reliable railway transportation through a steady power supply. In addition, shrinking the facilities' size will enhance the efficiency of construction. Furthermore, in March 2023, Tata Power, a unified power company from India, joined forces with Enel Group, a green energy and AI company from Italy, with the goal of digitalizing and automating India's power distribution network. The initial project under this collaboration will aim to increase the digitization and automation of secondary substations. Tata Power will participate in Gridpertise's unique QEd - Quantum Edge Device international co-creation programme. This partnership will digitalize grid functionality, thereby heightening network security and control, automation, real-time issue identification, and service recovery.
Who Are the Key Players in the Digital Substation Market?
Major companies operating in the digital substation market include:
• ABB Ltd.
• NR Electric Co. Ltd.
• Eaton Corporation Inc.
• Schneider Electric SE
• General Electric Company
• Larsen & Toubro Ltd.
• Siemens AG
• Toshiba Corporation
• DNV GL
• Hitachi Ltd.
• iGrid S. L.
• Kalki Communication Technologies Private Limited
• Locamation
• Panasonic Corporation
• Cisco Systems Inc.
• Honeywell International Inc.
• Emerson Electric Co.
• Mitsubishi Electric Corporation
• Schweitzer Engineering Laboratories Inc.
• G Power and Industrial Solutions Limited
• Arteche Group Corporation
• EFACEC Power Solutions SGPS S. A.
• Alstom Ltd.
• Hyundai Electric & Energy Systems Co. Ltd.
• Powell Industries Inc.
• Rittal GmbH & Co. KG
• Belden Inc.
• Beckwith Electric Co. Inc.
• ERLPhase Power Technologies Ltd.
What are the Regional Insights into the Digital Substation Market?
Europe was the largest region in the digital substation market in 2024.Asia-Pacific is expected to be the fastest-growing region in the forecast period. The regions covered in the digital substation market report are Asia-Pacific, Western Europe, Eastern Europe, North America, South America, Middle East, Africa
