Rise in Electricity generation and consumption
According to the World Bank, the urban population accounted for 55.27% of the total population globally in the year 2018. This resulted in higher electricity consumption for domestic and industrial use. This rate of consumption globally and the government’s policies of achieving total electrification in developing countries is driving the need to generate more electricity. This results in a demand surge for distribution feeder protection relay systems. Moreover, avoiding transmission losses amidst Covid-19 are some of the considerable factors that are estimated to promote the growth of protective relay market. Additionally, this growth is backed by rising number of initiatives taken by governments of different regions to automate the electrical grids and avoid failures caused as a result of uneven voltage drops and natural calamities.
Renewable energy grids
On the back of growing technological advancements and concerns towards developing ecofriendly solutions in order to minimize carbon emissions, the global protective relay market is estimated to witness noteworthy opportunities throughout the forecast period. This, in turn, is driving manufacturers to come up with consumer and nature-friendly solutions.
The potential factor that might affect the growth of the market is the high cost associated with installation and maintenance of protective relay devices.
Rise in electricity consumption levels, developing sustainable renewable energy grids, technological revamp of older relay devices along with advanced microprocessors are some of the significant factors anticipated to boost the market growth. Additionally, automation in the grids and distribution units along with favorable government policies towards complete electrification are factors projected to drive the global protective relay market with a notable CAGR during the forecast period, i.e., 2020-2028. Based on construction type, the market is segmented into electromechanical, induction disc overcurrent relay, static and others, out of which, the highest market share is estimated to be held by the segment for electromechanical protective relays. This can be attributed to its sensitivity to grid fluctuations, quick response times and life span. The market is further segmented by power source into self, auxiliary and dual powered. Among these segments, the self-powered segment is predicted to hold the largest market share in the next few years owing to its capability to function autonomously and its independence from the grid power. Additionally, the option to remotely operate these protective relays further is estimated to contribute to the growth of the segment.
Our in-depth analysis of the protective relay market includes the following segments:
By Power source
By End user
On the basis of regional analysis, the protective relay market is segmented into five major regions including North America, Europe, Asia Pacific, Latin America and Middle East & Africa region. The market in North America is anticipated to hold the largest share in the market on account of presence of leading market players in the region which manufacture and market the relay devices. Moreover, the retrofitting and revamping the existing grid infrastructure and the need for efficient generation and transmission components for electricity from renewables in this region further increases the product demand. The market in Asia Pacific region is predicted to grow at the highest rate during the forecast period as a result of growing automation in the grid infrastructure and initiatives to increase renewable energy capacity addition in the region, especially in countries such as China, India and Japan. This is further anticipated to result in the increased demand for protective relay devices.
The protective relay market is further classified on the basis of region as follows:
On May 5, 2020, ABB – a Swiss-Swedish MNC entered into an agreement with ASKO – Norway’s largest grocery wholesaler to supply charging infrastructure for its fleet of electric trucks.
In 2023, market players might incur losses due to huge gap in currency translation followed by contracting revenues, shrinking profit margins & cost pressure on logistics and supply chain.
Controlling Inflation has become the first priority for global economies from last quarter of 2022 and to be followed in 2023. With skewed economic situations, rise in interest rate by governments to control spending and inflation, spiked oil and gas prices, high inflation, geo-political issues including U.S. & China trade war, Russia-Ukraine conflict to intensify the global economic issues.
The interest rates in the U.S. may be less sensitive in 2023 as compared to 2022; sigh of relief for businesses. Positive business sentiments, healthy business balance sheets, growth in construction spending (private construction value in 2022 stood at $1,429.2 billion, 11.7 percent (±1.0 percent) above the $1,279.5 billion spent in 2021, Residential construction in 2022 was $899.1 billion, up by 13.3 percent (±2.1 percent) from $793.7 billion in 2021, non-residential construction touched $530.1 billion, 9.1 percent (±1.0 percent) above the $485.8 billion in 2021.) showcases minimal impact of recession in the country.
Similarly, spiked spending in the European and major Asia economics including, India, China & Japan to showcase less impact on the global demand.