Market Trends of Europe Submarine Power Cables Industry
This section covers the major market trends shaping the Europe Submarine Power Cables Market according to our research experts:
Increasing Demand for HVDC Transmission Systems
- The submarine HVDC transmission system market is likely to grow significantly on account of the development of submarine power transmission systems across the European region. The submarine transmission of electricity is gaining importance on account of the increasing focus on power trading between countries.
- The HVDC submarine power transmission system is a key technology for the development of future power transmission networks. HVDC transmission is the only solution available for the transfer of high power across long subsea distances. The major purposes served by HVDC submarine transmission are to interconnect countries or islands separated by sea and to connect remote offshore platforms to main transmission grids
- Moreover, the HVDC submarine power transmission system helps countries separated by water bodies to trade electricity from each other, which is a major driver for the segment as countries are interested in generating revenue from excess electricity generated through renewable energy sources. For instance, In April 2022, Siemens Energy have been awarded a contract of approximately USD 1.95 billion for the NeuConnect project to lay undersea power cables between United Kingdom and Germany that is likely to enable 1.4 gigawatts of electricity to pass in both directions between the U.K. and Germany.
- Furthermore, the development of offshore projects, such as wind power plants and offshore oil and gas upstream projects, offers increasing business opportunities for HVDC technology across Europe.
- Hence, such developments are likely to make the submarine HVDC transmission systems the dominant type during the forecast period.
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United Kingdom is Expected to Dominate in the market
- The United Kingdom is one of the leading countries in submarine power cable installations owing to the increasing offshore wind installations.
- The United Kingdom, Wind energy capacity has reached 27.3 GW in 2021, which is higher than 49% of total wind energy production in 2012. The offshore wind energy projects have witnessed a significant rise in the last few years. Offshore wind energy capacity has increased from 2.9 GW in 2010 to 12.7 GW in 2021.
- On 17th January 2022, the United Kingdom government awarded 17 offshore wind projects in Scotland. The total capacity of projects is expected to be more than 24 GW. The company that completed bidding are Scottish Power Ltd, BP plc., Shell Plc, Ocean Winds, Vattenfall AB, SSE, Falck Renewables S.p.A, DEME, BayWa r.e. AG, Northland Power Inc., and Magnora Offshore Wind. Of these 17 offshore wind energy projects, around ten projects have a floating foundation which accounts for more than 14.7 GW of wind energy production capacity. Thus, such upcoming offshore wind energy projects are likely to drive the submarine power cables market in the United Kingdom during the forecast period.
- The government announced that it is going to invest more than USD 42.57 million in floating wind projects and also expects more than USD 37 million from private companies. This investment is expected to achieve the government's 40 GW of offshore wind energy by 2030. Thus, such supportive government initiatives are likely to drive the submarine power cables market during the forecast period.
- Hence, such developments are likely to make United Kingdom the dominant player in the Europe Submarine Power Cables market during the forecast period.
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