Dry Type Transformer Market Size, Share & COVID-19 Impact Analysis, By Technology (Cast Resin and Vacuum Pressure Impregnated), By Phase (Single-Phase and Three-Phase), By Installation (Outdoor and Indoor), By Rating (Less than 5 MVA, 5 MVA to 30 MVA, and More than 30 MVA), By Application (Industries, Inner-City Substations, Indoor and Underground Substations, Renewable Generation, and Others), and Regional Forecast, 2021-2028

The global dry type transformer market size was USD 5.63 billion in 2020. The market is projected to grow from USD 5.93 billion in 2021 to USD 9.05 billion in 2028 at a CAGR of 6.2% in the 2021-2028 period. The global impact of COVID-19 has been unprecedented and staggering, with dry type transformers witnessing a negative demand shock across all regions amid the pandemic. Based on our regional analysis, the global market exhibited a lower growth rate of about -5.0% in 2020 as compared to the average year-on-year growth during 2017-2019. The sudden rise in CAGR is attributable to this market’s demand and growth, returning to pre-pandemic levels once the pandemic is over.

Dry type transformer is a magnetic core transformer comparatively designed on a modern technology that utilizes forced air or natural cooling rather than oil. As opposed to liquid-filled transformers that use liquid or oil to cool, dry-type utilize mainly high-temperature insulation systems that are eco-friendly. The windings of these transformers are enclosed in pressurized and sealed tanks and are air/vacuum cooled. These transformers require minimum maintenance, as they contain no moving parts and offer long-run cycles and reliability. Additionally, these transformers have better short circuit and impulse strength and are moisture-proof. These transformers are entirely hazard-free and can be easily installed in schools, hospitals, chemical plants, buildings, and factories where fire safety and security are a major concern. 

Investment Deficits to Amid COVID-19 Pandemic to Hinder the Market Pace

The global dry type transformer market growth has also been stumbled by the outcomes of the COVID-19 impact. Additionally, persistent demand for new developments in response to the crisis, including the commercial and healthcare sectors, will positively impact the industry outlook. Also, the rising demand for these systems may notice a marginal decline due to minimal on-site operations and supply chain interruptions. However, the modernization and automation of existing industries across several regions to meet their low-carbon targets are expected to counterbalance the growth during the pandemic. For instance, In August 2021, one of the global leaders in power companies, AES, is operating with Google X, a subsidiary of Alphabet Inc., to establish a virtual grid power distribution system of AES, which will guide to improve reliability when the system/network is utilizing more clean energy resources.

LATEST TRENDS

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Growing Adoption of Non-Conventional and Renewable Energy to Propel Market Growth

Major economic countries globally are promoting several initiatives to enhance the part of renewable energy in their energy equity. To lower the dependence on coal-based electricity generation, several countries are increasing the renewable energy generation adoption in their total electricity produced. Liquid-fill transformers are replaced by dry-type in the renewable energy zone owing to their design and safety aspects. Several government policies across the globe are initiating the usage of renewable energy in their industrial sectors. For instance, the government of the U.S. has targets to lower the Green House Gas emission to 50-52 percent by 2030 and trying to end the GHG emission by 2035 due to the usage of fossil fuels for power generation.

Merger and Acquisition Initiatives by Key Players to Boost Market Growth

Various industry players are continuously working towards performing organic and inorganic expansion activities to augment their product portfolio and reach across the globe, stimulating the adoption trends of the market. For instance, in July 2020, a global leader in providing technology and digital solutions, Hitachi, announced the acquisition of an 80.1% stake in a pioneering leader in technology, ABB Power Grids, and formed a collaborative venture as Hitachi ABB power Grids Ltd. The acquisition will help Hitachi to enhance its portfolio of products in the transformer unit.

DRIVING FACTORS

Increasing Demand for Environment-friendly Transformers to Augment Market Expansion

Global usage of environmental products is surging, resulting in the development of technologies, which can assist in achieving the environmental targets. The liquid-fill transformers are prone to security and safety-related issues owing to the low cooling rates, thus leading to leakages by overheating. The dry-type eliminates spills and leaks and is a convenient option to replace liquid-fill transformers. Also, the liquid-fill transformers have a major risk of catching fire; thus further protocols are needed to manage environmental and fire risks. Hence, the usage of eco-friendly products in the development and upgrade of power infrastructure is taken into consideration, which creates new opportunities for dry type transformers across the globe.

Upgrade of Aging Power Distribution and Transmission Infrastructure to Accelerate Market Development

The upgrading of aging power distribution and transmission systems is expected to drive the growth of the market. The rising trend, owing to increasing domestic power demand and rapid industrialization resulted in the expansion of distribution and transmission networks. The increasing demand for modernized and intelligent power distribution infrastructure is likely to create ample opportunities for the market. Additionally, the use of vacuum pressure impregnation technique increases the adoption of transformers in moisture prone areas which is expected to increase the product demand.

In June 2021, Snohomish County PUD made electric system improvements in its existing substations. The PUD has work scheduled on many substations, including automation upgrades, equipment replacement, and standard maintenance. In addition, the PUD plans to replace their existing aging poles, assess and treat thousands of poles, and replace miles of aging underground cable. 

RESTRAINING FACTORS

High Cost of Product May Hinder Market Development Pace

The high cost associated with these types of transformers is expected to restrict the market growth. The complex construction of these transformers makes them costlier as compared to the oil-immersed transformer. Additionally, these transformers have several disadvantages over oil-immersed transformers, for example, cast resin has comparatively poor heat dissipation. Furthermore, solid-state transformers are used as a replacement for dry type transformers, which is expected to hamper the market growth during the forecast period.

SEGMENTATION

By Technology Analysis

Cast Resin Technology to Account for Significant Dry Type Transformer Market Share due to its Growing Applications in Renewable Projects and Commercial Buildings

Based on technology, the industry is categorized into two divisions: cast resin and vacuum pressure impregnated. The cast resin dry type transformer technology is expected to witness a substantial rise owing to its extensive adoption in areas such as public & general buildings, wind turbine plants, industrial plants, solar farms, and commercial areas, including railways & airports. In this transformer, the live part consists of a core, and windings are encapsulated internally in a resin, which is in fluid form.

Furthermore, the vacuum pressure impregnated technology is expected to grow at the highest CAGR during the forecast period. The growth is attributed to its features, such as no danger of explosion or fire, no liquids to leak, and excellent mechanical strength. In this transformer, the live part is impregnated by epoxy varnish under pressure in a vacuum chamber and offers entry to the live part after impregnation, providing exceptional fire protection ratings.

By Phase Analysis

Expansion of Long and Medium Route Transmission Systems to Propel Three-Phase Dry Type Transformer Market Growth

Based on phase, the market is divided into single-phase and three-phase transformers. It is estimated that the three-phase type is showing significant growth due to widespread migration to the suburbs and favorable government norms related to the expansion of long-distance and medium-range transmission networks. In addition, the ongoing demand for electricity, driven by the increasing tendency of energy suppliers to expand the electricity network infrastructure, will determine the market prospects.

The single-phase type is expected to grow at a significant CAGR over the forecast period. This is attributed to the widespread adoption of these transformers in low voltage distribution applications. These transformers use single-phase alternating current, where the transformer depends on the voltage cycle, which operates in a uniform phase of time. They are generally used to reduce localized and long transmission streams to levels of performance suitable for light commercial and residential applications.

By Installation Analysis

Indoor Transformers Will Enlarge Due to the Rising Space Constraints and Initiation of Advanced Product Design

Based on installation, the industry was divided into indoor and outdoor transformers. It is expected that the indoor dry-type transformers will have a large market share due to the ongoing modernization of the network infrastructure due to increasing space constraints. In addition, the government and private administrations are spending huge sums on electrification programs to fuel segment growth of the market. It is estimated that the number of outdoor dry-type transformers is growing due to the expansion of power grids, including distribution and transmission lines. Increasing safety concerns combined with strict government standards for a reliable and safe power supply will also further stimulate product demand.

By Rating Analysis

Growing Investments in Commercial Establishments Will Drive 5 MVA to 30 MVA Dry Type Transformers Segment

Based on rating, the industry is segmented into three divisions, including less than 5 MVA, 5 MVA to 30 MVA, and more than 30 MVA. The 5 MVA To 30 MVA rating type is projected to hold a major share in the market due to growing infrastructural investment adjoined with the development of commercial sectors such as hotels, malls, resorts, colleges, and schools.  Besides, the continuing expansion of road and rail networks propelled by the adoption of the product in chemical plants and steel factories is expected to enhance the business landscape. The less than 5 MVA segment is estimated to enlarge owing to its usage in commercial, low-voltage industrial, and public buildings applications. On the other hand, more than 30 MVA types have applications in any industrial, commercial, production, or manufacturing process application.

By Application Analysis

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Industries Application Segment is Projected to Enhance the Product Demand

Based on application, the industry is classified into industries, inner-city substations, indoor and underground substations, renewable generation, and others. The industries application segment is expected to hold a significant portion of the global market owing to the wide-scale adoption in oil & gas, chemical, marine, railway, renewable energy generation, and others. Additionally, major manufacturers of this industry are focused on supplying specialized transformers suitable for a variety of applications.

The indoor and underground substations application segment is estimated to grow due to the benefits of these transformers, such as low fire hazard, reliability, eco-friendly, low noise level, compact design, low maintenance, and moisture resistance. Subsequently, growing security and safety concerns propelled with stringent government norms further propel the market segment growth. The renewable generation application segment is expected to grow significantly on account of the increasing adoption of clean energy systems adjoined with growing electrification programs.

REGIONAL INSIGHTS

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Geographically, the market is analyzed across North America, Europe, Asia Pacific, Latin America, and the Middle East & Africa. Asia Pacific is projected to hold the leading share across the industry and was valued at USD 2.01 billion in 2020. The region is expected to see a high demand due to the rising electricity demand adjoined by the replacement of conventional electrical grid lines. In addition, increasing infrastructural investments with advanced & modern residential sectors will boost the market growth in the region. For example, in December 2020, Aflac completed its sustainable investments worth more than USD 1.7 billion, including bonds supporting education, affordable housing, public transit, and hospitals in Japan and the U.S.

The North America market is another major market for dry type transformers, owing to the rising demand for restructuring and refurbishment of conventional grid infrastructure supported by the digitalization of power utilities. Favorable regulatory norms for grid sustainability adjoined with the rapid adoption of smart monitoring and control systems will boost the market outlook in the region. For instance, in July 2021, the U.S. and California governments declared an agreement to open massive wind energy farms on the northern coasts and the state’s central province. California is expected to produce all forms of electricity through zero-carbon generating facilities and renewable energy resources by 2045.

Europe is expected to grow significantly during the forecast period, owing to the growing investments in grid expansion and considerable advancement in smart grid deployment. Subsequently, key industry players are offering and innovating transformers to deliver advanced safety and voltage features at a lower rate. Major countries contributing to the European market are the U.K., Germany, France, Italy, Russia, Belgium, and Poland. Also, to lower the dependence on the coal-based generation of electricity, countries in the region are adopting measures to increase renewable energy generation. For example, European member states, such as Germany, are investing in wind and offshore solar farms, which require power and distribution transformers in integration with the central power grid. Such investments policies increase the demand for transmission and distribution grid expansion projects in the region.

KEY INDUSTRY PLAYERS

Leading Players such as ABB are Introducing Hybrid Products to Fortify their Market Position

The global market is significantly competitive, with several players actively operating across different channels of distribution. The industry participants are emphasizing the introduction of new hybrid type transformers with new technologies to enhance customer reach. Furthermore, the organizations are entering into merger and acquisition contracts to expand their technological horizons.

For example, ABB, one of the leading global technology companies, is introducing hybrid dry type transformers featuring new technologies to foster its reach in the industrial sector. In November 2018, the company introduced a vacuum cast coil transformer, which is the most technologically pioneering design for extreme/harsh conditions. Furthermore, the product is manufactured and designed to produce flexibility for special requirements and optimum space utilization. Additionally, these transformers are suited for strict parameters related to electrical system demands and are design for a virtually maintenance-free process.

LIST OF KEY COMPANIES PROFILED:

• Hammond Power Solution (Canada)


• Schneider Electric (France)


• Siemens (Germany)


• Eaton (Ireland)


• Crompton Greaves Consumer Electricals Limited (India)


• GE (U.S.)


• Hyosung Heavy Industries (South Korea)


• Voltamp Transformer Limited (India)


• Kirloskar Electric Co. Ltd. (India)


• ABB (Switzerland)


• Bharat Heavy Electricals Limited (India)


• Fuji Electric Co., Ltd. (Japan)


• Hanley Energy (Ireland)


• Tbea Co. Ltd. (China)


• Virginia Transformer Corp. (U.S.)


• KOTSONS (India)

KEY INDUSTRY DEVELOPMENTS:

• June 2021 - Powerwell secured an RM9.6mil contract to install and supply dry type transformer, load break switch, and switchgear. The agreement is for an expansion project of a multi-national firm’s semiconductor assembly testing facility based in Penang and is expected to be completed in the second quarter of 2021.


• June 2020 – A global leader in power management and solution provider, Eaton corporation, declared the accomplishment of its acquisition of Cobham Mission Systems, which is one of the leading producers of environmental systems, air-to-air refueling systems, and actuation, primarily for the defense sector.

REPORT COVERAGE

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The market research report offers an in-depth analysis of the industry. It further provides details on the adoption of dry type transformer systems across several regions. Information on trends, drivers, opportunities, threats, and restraints of the market can further help stakeholders to gain valuable insights into the market. The report offers a detailed competitive landscape by presenting information on key players, along with their strategies, in the market.

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