Market Trends of Europe Gas Insulated Switchgear Industry
High Voltage Level Segment Expected to Dominate the Market
- The power system that deals with voltages above 36 kV is referred to as high voltage switchgear. As the voltage level is high, the arcing produced during the switching operation is also very high. So, special care is to be taken during the design of high-voltage switchgear. High-voltage circuit breakers are the main component of HV switchgear; hence, high-voltage circuit breakers (CB) should have special features for safe and reliable operation.
- These switchgears have multiple usages across varied industries such as wind turbines, electrical motors, generators, solar power generation, residential power distribution, power supply systems, environmentally sensitive installations, underground stations, the steel, paper, and mining industries, and a growing number of marine applications. But the main application of the segment comes from large transmission and distribution networks that are being modernized and built across the globe, with especially high rates in countries in the Asia-Pacific region.
- However, the segment has been plagued with downtime and maintenance issues. For this, companies such as ACTOM High Voltage (HVE), in May 2022, in conjunction with its technology partners, were expected to develop asset performance management solutions to help customers with condition-based maintenance strategies. Such endeavors in the industry are expected to aid the growth of the market by providing a more feasible alternative to the market, especially when compared to its peers.
- Also, the growing HVDC market is expected to aid the growth of the market with large projects. In July 2021, Nordic Investment Bank (NIB) signed a seven-year loan agreement with the Norwegian utility company, Varanger Kraft, to finance the Varanger Ring electricity grid project in Northern Norway. According to the agreement, NIB offers USD 27.3 million, co-financing three new high-voltage (132 kV) lines, four new substations, and the refurbishment of two older substations.
- As of 2022, the region had a renewable energy installed capacity of 708.58 GW. With the ongoing energy diversification in the region, several countries are focusing on investment in renewable technologies such as solar photovoltaic and wind power to have a lower dependency on fossil fuels. Additionally, with the rising carbon emission concerns, the governments have launched various policies regarding the development of renewable energy. The policies are expected to provide a significant boost to the growth of the renewable energy market by integrating the renewables into the national grids, which is expected to drive the high-voltage gas-insulated switchgear market.
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Germany to Dominate the Market
- Germany, one of the leading European countries, plans to phase out coal and nuclear power plants and is likely to move completely towards renewable energy by 2035. As of 2022, the country had 148.37 GW of installed renewable energy capacity as of 2022.The country phased out its remaining three nuclear reactors in January 2022 and plans to phase out coal power plants by 2030. Hence, with such a transitional phase, Germany is likely to build 7783 kilometers (Km) of high-voltage transmission lines and to invest around USD 58 billion by 2030. The 7783-kilometer transmission line project includes the construction of four direct current transmission lines connecting the north with the industrial west and south of the country.
- According to researchers, the new north-south connections wouldn't be sufficient to absorb the growing wind energy capacity in the north and deplete conventional power capacity in the south. Hence, the country has the possibility of refurbishing 3050 km of power lines and building 2750 km of new connections by 2024. Thus, such a scenario would increase the demand for gas-insulated switchgear during the forecast period.
- In November 2022, Hitachi Energy announced that it will provide first sulfur hexafluoride (SF6) free 420-kilovolt (kV) gas-insulated switchgear (GIS) technology and a modular prefabricated grid connection solution at a pivotal node at TenneT’s power grid in Germany. Hitachi is going to deliver innovative EconiQ 420 kV GIS that uses a technology that eliminates SF6.
- Apart from power line expansion projects, the country has made some changes to its laws, such as the renewable energy law (EEG), the offshore wind law, the Energy Act, the federal law on electricity grids, and the Grid Expansion Acceleration Act. Under the renewable energy law, nearly 10 GW of onshore wind capacity per year (2022-2025) and 6 GW of solar energy in 2022 were expected to be tendered. Further, under the Energy Act and the Grid Laws, the government is expected to consider 19 power grid expansion projects. Such changes in the laws are expected to have a positive impact on the market.
- Thus, such a scenario would increase the demand for gas-insulated switchgear during the forecast period.
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