Solid State Transformer (SST) Market Outlook - 2028
Global solid state transformer market was valued at $141.5 million in 2020, and is projected to reach $468.0 million by 2028, growing at a CAGR of 16.9% from 2021 to 2028. Solid-state transformer (SST), also known as a smart transformer, is an advanced type of transformer that incorporates various semiconductor components, control circuits, and another high-frequency transformer. Compared to traditional transformers, it enhances the quality of the power by controlling voltage fluctuations. It reduces grid losses and supply reliability and protects the load from power supply disruptions. It allows voltage conversion from Alternate Current (AC) to Direct Current (DC), DC to AC, and also DC to DC on different voltage levels. Currently, it caters to a wide variety of applications, ranging from renewable power generation, electric vehicle charging facilities, and power grids.
The global solid state transformer market is presently driven by various factors, namely the growing renewable electricity production, electric mobility, and heavy investments in smart grids and energy systems.
Furthermore, reduction in dependency on conventional electricity based on coal and crude oil is expected to drive the growth of the renewable energy industry in the future. In fact, countries such as Germany, China, the U.S., and Canada have already moved to wind power and solar power. Solid-state transformers connect these various energy sources to power girds and improve the efficiency of power transmission systems. In the electric mobility segment, electric vehicles are being produced at a phenomenal rate and will require more charging infrastructure in the future. EV charging is based on direct current (DC) sources and has increased the demand for active power control; thus, driving the demand for smart transformers. Moreover, solid-state transformers are used to effectively manage smart grids. Hence, growing investment and participation in the smart grids market will benefit the global solid state transformer market in the long run. However, as solid-state transformers are not much commercialized, it presently has a high cost and low consumer awareness. Therefore, the adoption of SSTs is low in developing and underdeveloped economies. These factors are expected to hamper the global solid state transformer market growth during the forecast period.
Developments in the design of SSTs that include various configurations and components is anticipated to help operating players in launching new products. Such new products will help in increasing the market share of solid-state transformers in the mainstream transformer market. The solid-state technology will benefit from research and development efforts by various research institutes and industry proponents like power company for developing new designs of solid-state transformers. One of the recent developments in the solid-state technology was the technological partnership between major transformer maker Hitachi ABB and Nanyang Technological University in Singapore in February 2021. With this partnership, both Hitachi and NTU aims to launch commercial transformers based on solid-state technology. Moreover, the application potential of SSTs is wide, ranging from locomotives, light rail, EV fast chargers, PV inverters, and battery energy storage systems. Some of these are emerging domains and are estimated to offer lucrative opportunities for market growth during the forecast period.
The global solid state transformer market is segmented on the basis of product type, application, and region. Based on product type, the market is divided into distribution solid-state transformer, power solid-state transformer, and traction solid-state transformer. Applications include renewable power generation, electric vehicle charging stations, power distribution, traction locomotives, and others. Region wise, the market is analyzed across North America, Europe, Asia-Pacific, and LAMEA.
Major players operating in the solid state transformer industry include Alstom SA, Eaton Corporation, General Electric Company, Hitachi ABB, Power Systems & Controls Inc., Red Box Aviation, Schneider Electric, Siemens AG, Varentec Inc., and Vollspark.
Solid-state transformer market, by region
Europe accounted for the largest solid state transformer market share in 2020. This is attributed to the massive adoption of renewable energy such as wind and solar power plants in major European countries. Asia-Pacific is anticipated to grow at the fastest CAGR of 18.6%. This fast growth rate can be attributed to the investments done by Asia-Pacific countries such as China, India, Japan, and Australia in the power industry.
Asia-Pacific would exhibit highest CAGR of 18.6% during 2021-2028
Solid-state transformer market, by product type
Power solid state transformers segment accounted for the largest market share in 2020, owing to factors such as rapid adoption rate, economical costs, and rise in product awareness in the power industry. Traction solid-state transformers are projected to grow at the fastest CAGR of 17.7%, owing to its potential use in locomotives and electric vehicles.
By Product Type
Traction solid state transformer segment is projected as the most lucrative segment.
Solid-state transformer market, by application
The renewable power generation segment accounted for the largest share in 2020. Renewable power generation from wind and solar panels require smart transformers for better power management. However, the electric vehicles charging segment will grow at the fastest CAGR of 21.5% during the solid state transformer market forecast period. Rise in EV sales coupled by public and private investments in charging infrastructure is conducive for the adoption of smart transformers and expand the solid state transformer market size.
Electric Vehicle Charging Station segment is projected as the most lucrative segment.
Key Benefits For Stakeholders
- The report includes in-depth analysis of different segments and provides market estimations between 2021 and 2028.
- Solid state transformer market analysis is done by studying the various drivers, restraints, and opportunities
- Porter’s five forces model illustrates the potency of buyers & sellers, which is estimated to assist the market players to adopt effective strategies.
- The key market players are profiled to gain an understanding of the strategies adopted by them.
- This report provides a detailed analysis of the current solid state transformer market trends and future estimations from 2020 to 2028, which helps identify the prevailing solid state transformer market opportunities.
Impact Of Covid-19 On The Global Solid-state Transformer Market
- Most of the industries have become non-operational during the pandemic. The lockdown imposed in various countries hit the operations of various power distribution companies; thus, impacting their financial health. This led to a decline in the demand for transformers.
- Renewable energy generation is the largest application for solid-state transformer, which is also affected to a great extent during the pandemic. The pandemic negatively affected the demand for renewable energy generation. Complete or partial lockdown situation globally has led to supply chain disruption, leading to delays in project construction, having a direct impact on the commissioning of renewable electricity projects
- In the global solar industry, more than 40% of the supply chain is reliant on supply from China and other Southeast Asian countries. China is the known source of this pandemic and the country is the most affected one in terms of material supply and material transport due to COVID-19. The above factors have impacted the growth of the global solid state transformer market.
Solid State (Smart) Transformer Market Report Highlights
Key Market Players
GENERAL ELECTRIC COMPANY, VARENTEC INC., SIEMENS AG, EATON CORPORATION, POWER SYSTEMS AND CONTROLS, INC., VOLLSPARK, RED BOX AVIATION, HITACHI ABB, SCHNEIDER ELECTRIC, ALSTOM SA
Significant increase in electricity requirements from various sectors is expected to increase the demand for solid-state transformers during the forecast period.
Furthermore, growth in adoption of wind and solar energy in the mainstream electricity production and infrastructural improvements in the locomotive markets will prove to be conducive for market growth.
It has been witnessed that there is still huge scope for development in the solid-state technology in terms of its construction. Therefore, the key players operating in this market are well positioned to invest in the R&D of solid-state transformers. Products are developed in a customized manner to cater to a large end-user base.
The renewable power generation segment holds the largest solid-state transformer market share in 2020. Power generation from wind and solar panels require smart transformers for better power management. Europe, being a leading promoter of renewable energy is the largest contributor to the global solid-state transformer market in terms of revenue in 2020.