Shunt Reactor Market - Growth, Trends, COVID-19 Impact, and Forecasts (2021 - 2026)

Market Overview

The Shunt Reactor Market is expected to grow at a CAGR of 6.1% over the forecast period (2021-2026). The need to increase the system's efficiency and provide reliable power is increasing the demand for a shunt reactor. The requirement for protection solutions for sudden voltage spikes and investments into upgrading existing transmission and distribution networks is also augmenting the demand for shunt reactors. The increasing demand for power will drive the demand for products, solutions, and services allied to the energy sector. Shunt reactor demand for the energy and utility will grow considerably in the coming years in-mid of increasing electricity demand and connectivity projects undertaken by various governments globally.

• For instance, the Ministry of Energy of the Republic of Lithuania has undertaken a project to synchronize the electricity network with the grid of Western Europe. This project will reduce electric power transmission capacities with Belarus and prevent the flow of electricity from the unsafe Astravets Nuclear Power Plant (NPP) in the future. In implementing the North-East Lithuanian reconstruction project, two 330 kV transformer substations in Ignalina and Utena will be reconstructed. A 330 kV-controlled shunt reactor will be moved from the Ignalina substation to the 330 kV switchyard in Elektrėnai.
• The growing energy demand in the industrial sector is another prominent influencer behind the incorporation of shunt reactors in power generation facilities in the region. For example, a second 330 kV shunt reactor of the Belarusian nuclear power plant was commission in April 2020. The equipment's adoption is for the overhead power lines, with the nominal voltage of 330 kV representing the primary source of reactive power. The continued participation of Siemens in SINCRO.GRID project has enabled the company to supply various shunt reactors to grid development projects in Europe. In Croatia, the company was able to install a 100 MVAr variable shunt reactor at the Mraclin substation.
• In February 2020, global electrical engineering firm W.E.G. announced the signing of an agreement with Transformadores e Serviços de Energia das Américas S.A. (TSEA) for the acquisition of one of its transformer factories located in the city of Betim, State of Minas Gerais, Brazil. The factory sits on 32,500 square meters of manufacturing facilities, equipment, and machinery. The factory is specialized in the manufacture of power transformers, shunt reactors and power autotransformers with voltage class up to 800kV and power ratings up to 500MVA.
• In September 2019, Kuwait's Ministry of Electricity of Water (MEW) invited a total of nine qualified Contractors to submit their proposals to undertake the execution of the maintenance and repair works at various 400kV, 300kV, 132kV Substations. The project scope of work involves maintenance and repair of following major equipment, and its associated equipment includes shunt reactors with voltage levels 300kV, 132kV, 33kV. Kuwait based Construction Company, United Gulf Enterprises General Trading & Contracting. Co. W.L.L. (UGETCO) has submitted the lowest bid of KWD 123.1 million.
• With the recent outbreak of COVID 19, the shunt reactor market is expected to face marginal decline due to the lockdown policies being adopted by the various governments worldwide. In April 2020, the Chinese power transmission network operator State Grid Corporation of China (SGCC) resumed construction on the 800kV, 800MW ultra-high voltage (U.H.V.) direct current (D.C.) power transmission project between Yulin, Shaanxi province and Wuhan, Hubei province after the lockdown was imposed in the region.

Scope of the Report

A shunt reactor is a device that engages in absorbing reactive power, increasing the energy efficiency of the system. Reactive power is the contributor to added load across power transmission systems. Shunt Reactors are commonly utilized for reactive power compensation in long high-voltage transmission lines and cable systems. Shunt reactors are generally connected to substation bus-bar, often directly to the overhead transmission lines. The study under consideration offers market developments of shunt reactors based on their types such as oil-immersed reactor and air-core dry reactor, by rated voltage, and form factor.

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Key Market Trends

Variable is Expected to Hold Significant Growth

• Variable Shunt Reactors (VSR) are utilized in high voltage energy transmission systems to stabilize the voltage during load variations. A traditional shunt reactor is equipped fixed rating and is connected to the power line all the time or switched in and out depending on the load. The rating of a VSR could be changed in steps. The maximum regulation range depends on the capability of the on-load tap changer used in combination with the regulation winding used for the shunt reactor. The maximum regulation range has risen over the years, from 50%, now up to 80% at some voltage levels. The variability brings more benefits compared to a traditional fixed shunt reactor. The VSR can continuously compensate reactive power as the load varies, which secures the voltage stability.
• Various countries globally are increasingly focusing on the renewable energy sector for reducing its power consumption costs. For instance, in 2019, the UK's renewable industry's energy outpaced fossil fuel plants in 137 days during the year (the greenest year in the United Kingdom). Owing to such growing renewable energy investments in the region, the shunt reactor vendors are also focusing their offerings to the industry requirements. Siemens in the United Kingdom has built one of the most significant variable shunt reactors featuring a rating of 120-300 MVAr and a rated voltage of 220 kV, weighing 317 metric tons and measuring approximately 10x8.5x8 meters.
• The European Project of Common Interest (PCI) target is to optimize the efficiency of the Croatian and Slovenian electricity transmission grids through the application of advanced technologies. In December 2019, the ELES substation in Divača had been equipped with a variable shunt reactor, in collaboration with Siemens. As per the contract, Siemens supplied and installed a variable shunt reactor (VSR) 0f 150 Mar. In August 2019, HOPS and Siemens signed EUR 5 million contracts as part of the Sincro.Grid project. The agreement deals with deploying a variable shunt reactor at transformer station TS 400/220/110 kV Melina, as part of the implementation of the EU-backed smart grid project Sincro.Grid.
• In March 2020, DIMO, with Siemens, signed a contract with Ceylon Electricity Board (CEB) to embark on the National Transmission and Distribution Network Development and Efficiency Improvement Project for enhancing national power supply in Sri Lanka. Habarana grid substation, Chunakam grid substation, and Naula grid substation projects are some of the major projects completed by DIMO-Siemens collaboration, redefining the local power sector. Habarana- Veyangoda grid substation, Variable Shunt Reactor Projects in Anuradhapura, and Mannar are some ongoing projects by DIMO and Siemens.

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