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ENERGY & POWER

California Distribution Transformer Market Segmentation By Insulation Type (Dry and Liquid Immersed); By Mounting (Pad, Pole and Underground Vault); By Phase (Single and Three); By Installation (Indoor and Outdoor); By Power Rating (Up to 500 KVA, 501 KVA-2,500KVA, 2,501KVA-10,000KVA and Above 10,000KVA); and By End Use (Electric Vehicles, Residential, Commercial and Industrial) – Regional Demand Analysis & Opportunity Outlook 2027

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IN THE NEWS
  • September 2018: ABB have announced the launch of an oil-free traction transformer “RESIBLOC Rail”, which is particularly designed for rail transport in order to improve rail safety.

  • April 2018: Eaton announced the launch of new optical sensor technology for grid monitoring solutions. The technology was introduced to aid in the voltage and current sensing pertaining to grid monitoring systems.

Market Overview and Growth Highlights

Distribution Transformer is a critical component of transmission and distribution (T&D) infrastructure. It operates at low voltage, generally less than 33 KV for industrial applications and 440-220V for domestic applications. Distribution Transformers are step-down transformers, which provides the final voltage to the end user from the distribution substation and operates at an efficiency of 50-70%.

Different Types of Distribution Image

The California’s transmission and distribution (T&D) network is an interconnection of generation facilities, high voltage (HV) transmission lines, substations, and low voltage (LV) distribution lines, along with the other states in the country. It has significant infrastructure which consists of numerous miles of HV transmission along with distribution cables serving a large array of consumers. The market is thriving on the back of increasing investments by the U.S. for the expansion, replacement and upgradation of the existing T&D infrastructure across states in the nation, for instance, California, Florida, Texas, New York and Washington. Additionally, several other factors, for instance, increasing demand for reliable power delivery systems, regulations and focus of the nation on renewable energy production are some of the major factors driving the growth of the California distribution transformer market.

The California distribution transformer market accounted for a market value of USD 46.1 million in the year 2018 and is expected to garner a CAGR of 4.5% by market value during the forecast period 2020-2027 achieving a market value of USD 67.0 million in the year 2027 with a growth of 1.45x. Additionally, the market accounted for a market volume of 30, 345 units in the year 2018 and is further expected to grow at a CAGR of 4.2% by market volume over the forecast period, achieving a market size of 42, 985 units by market volume in the year 2027 with a growth of 1.42x. CLICK TO DOWNLOAD SAMPLE REPORT

Market Segmentation Synopsis

The California distribution transformer market is segmented by insulation type into dry type and liquid immersed type, out of which, the liquid immersed distribution transformer segment held the largest market share of around 72% during the forecast period. The liquid immersed segment held a market size of USD 33 million by market value in the year 2018 and is estimated to achieve a market size of USD 49 million by market value by the end of 2027, achieving a CAGR of 4.6% during the forecast period.

California Distribution Transformer Market Share

Market Drivers & Challenges

Growth Indicators

Aging and Inadequate T&D Infrastructure

According to the U.S. Department of Energy, around 70% of total transformers in the nation were more than 25 years old as of 2018. Moreover, over 60% of the total distribution poles were more than 30-50 years old.

Increasing number of aging transformers in U.S. along with concerns for the reliability of existing electric power delivery system which poses threat to the national security are raising the need for replacements of existing T&D infrastructure which is anticipated to drive the growth of the California distribution transformer market. Increasing number of power outages, equipment failures and others on the back of aging infrastructure along with the rising susceptibility of the aging transformers to bad weather events, coupled with growing number of utility investments which will raise the demand for more electricity consumption, all of these factors are expected to drive the California distribution transformer market.

Major Power Outages in California

Supportive Regulations and Increasing Renewable Energy Generation

According to California Energy Commission, California is known to have some of the most aggressive renewable energy goals in the U.S. As per its renewable energy portfolio standards (RPS), approximately 33% of the retail electricity sales takes place by renewable sources and is planned to reach a figure of 50% by 2050.

Favorable standards and regulations pertaining to the efficient transmission and distribution of the electricity, coupled with shifting focus towards renewable energy projects, which requires new high voltage transmission lines for the delivery to the grid, along with increasing demand for reliable power delivery systems, all of these factors are anticipated to drive the growth of the California distribution transformer market.

Percent of California In-State Electricity Generation through Renewables

Barriers

Inadequate Inspection and Technical Stress

Lack of periodic testing and inspection pertaining to power and distribution transformers in California, coupled with stringent standards and quality demands concerning the manufacturing of distribution transformers, all of these factors are anticipated to be a major constraining factor for the California distribution transformer market.

Competitive Landscape

Some of the affluent industry leaders in the California distribution transformer market are ABB, Mitsubishi Electric Corp., General Electric, Hubbell, and Eaton. Apparently, the U.S. has some of the major global distribution transformer manufacturers, and more than hundred manufacturers and importers of distribution transformers are operating in the U.S. Few other major manufacturers for the liquid immersed transformers in the U.S. are ABB, Cooper Power Systems, ERMCO and General Electric. On the other hand, major manufacturers for dry type transformers include ABB, Acme Electric Corporation (Hubbell), and Eaton.

The companies are actively getting engaged in the expansion of product portfolio along with investing in high quality R&D to gain competitive edge over other players in the California distribution transformer market.


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