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The global medium voltage protection relay market size was USD 0.99 billion in 2020. The market is projected to grow from USD 1.07 billion in 2021 to USD 1.59 billion in 2028 at a CAGR of 5.82% in the 2021-2028 period. The global impact of COVID-19 has been unprecedented and staggering, with medium-voltage protection relay witnessing a negative demand across all regions amid the pandemic. Based on our analysis, the global market will exhibit a huge decline of -8.6% in 2020 as compare 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.
A medium voltage protection relay can respond to an infinite number of abnormalities that may happen within the network. The protection relay acts as an electromagnetic switch that helps turn on and off a much larger electric current through the opening and closing of contacts in another circuit to avoid any faults. The control of the circuit helps regulate the flow of power, leading to the carrying out of basic switching operations.
Industries such as utility railways use medium-voltage protection relays in their electric power system to perform a reliable energy supply and avoid faults or breakdowns. The increasing adoption of protection relay in the renewable energy system to provide the reliable operation of the system is expected to propel its demand in the coming years. Furthermore, increasing digital technologies in relay technologies also result in a cost-effective and more efficient solution, resulting in its wide acceptance.
Decrease in Electricity Demand amid COVID-19 to Impede Market Growth
The medium voltage protection relay market has been intermediately affected due to the outbreak of COVID-19, as it has reduced the demand for electricity across the world. Several governments around the globe have decided to reduce business activates and impose lockdowns, travel restrictions to eliminate the spread of the virus. The ongoing situation caused due to the outbreak of the COVID-19 pandemic has halted the industrial operation due to lack of manpower and restricted business. This ban has resulted in a substantial decrease of power in commercial and industrial loads that eventually affects the national energy demand profile. This devastating situation is creating various technical and financial challenges in the power sector.
Emerging countries are setting their clean energy targets by installing renewable energy sources, which has also witnessed a significant reduction in the installation process and new investments. For context, as per the International Renewable Energy (IEA) report the growth in renewable energy has witnessed a significant demand of -13% due to the disruption in the supply and demand chain, social distancing measures, travel restrictions movement, and many other measures to contain COVID-19 spread vastly denting the national economy.
Other industry verticals such as the railway sector have also witnessed the impact of COVID-19 due to travel restrictions resulting in decreased footfall, reduction in downtime of services, and tickets purchasing, which have caused major economic hamper to the industry.
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Reliability of Medium Voltage Protection Relays is Likely to Drive Market Growth
Medium voltage protection relays are one of the most important devices used in the design and operation of an electric power system and serve to prevent electric failure, which can be caused due to equipment failure or sudden outages, and maintain normal operation of the system. The use of protection relay in various electrical applications, such as generator, transformer, motor, and others, generally imposed on electrical stressed acts as the primary requirement to perform a reliable operation that is likely to drive the medium voltage protection relay market growth.
In addition to this, the medium voltage protection relay also plays a key role in indicating the type and location of the failure, which further helps in assisting expediting repairs and minimizes the losses. For context, in May 2021, ABB launched the new Relion protective relays to support safe, smart, and sustainable solutions for electrification and make industrial processes and grid operation more reliable and easy to operate. Additionally, the ABB’s Relion series of relays possess a proven protection algorithm and innovative solution that leads the optimal protection for the power distribution applications and helps to meet the rising energy demand with high reliability and energy supply.
Increasing Need to Replace Conventional Relays to Propel Demand for Protection Relays
Conventional relays are generally used to switch to current or voltages in electric system applications which is usually done by a simple on-off switch. However, various industrial processes and applications run at higher voltage ranges which can cause unwanted accidents or failure. Additionally, such relays possess shorter life as they wear out after repeated usage. Hence, various manufacturers and end-users focus on automated relays that fit the digital age and ensure the reliable and safe operation of the system.
In addition, the advancement in new relays is more convenient to use. It helps reduce the cost as it provides real-time data, which helps quickly identify and replace the failed component in the system. For context, Schweitzer Engineering Laboratories has provided Metro Wastewater Reclamation District with its utility-grade SEL-701 Motor Protection Relays to replace their aging relays and give the necessary assurance of critical blower of system uptime. The addition of SEL’s utility-grade relays solves the complete purpose feature of protections and helps in meeting monitoring, commendations, and metering capabilities
Integration of Protection Relays with Renewable Energies Will Boost Market
Over time, various governments set their targets of green energy to overcome climate change issues and reduce carbon emission, which led to the increasing adoption of renewable energy sources such as solar, wind, and others. The use of renewable energy sources has changed the operating mode of power systems and energy storage. This factor is creating a market driver for large inverters to process clean energy, which resulted in demand for protection for overcurrent and complex control systems, which will, in turn, create major opportunities for protection relays with great capabilities, communications, and monitoring systems.
In addition to that, other factors such as grid stability and economic cost are also leading to various market opportunities to protect relays to reduce power failure unprotected generation scenarios, among others. Hence, the adoption of renewable energy in utility and electrical to achieve clean energy targets has led to developing and adopting a range of protection relays. For example, Fanox has designed self-powered protection relays that reduce the maintenance of distribution centers and are operational in very harsh conditions.
High Maintenance Cost of Protection Relays Likely To Hinder Market Growth
Protection relays are devices used in an electric power system to detach the problem and reduce the damage of components. However, protective relays remain idle for most of the time due to a power system and require periodic maintenance and testing to improve the reliability of operation. If the maintenance of a component is not carried out in a given time, it may lead to system breakdown or frequent failures, which can cause damage to the system.
Additionally, the protection relays may require replacement after a certain period. The aging of relays or problems caused due to pollution or dust may lead to spurious tripping in the system. Moreover, the increased adoption of digital relays possesses threats such as cyber-attacks, can lead to data breaches, and is likely to hinder the key market growth. However, various leading manufacturers are coming up with leading solutions to provide resilience associated with such threats. For example, ABB has developed REX640 protection and control relay, which allows additional factors such as user authentication, security logging, secure web-based interface, and others to increase security and resilience to the power system.
Feeder & Generator Relay Segment to Grow at High Pace
The market is segmented into self-power relays, feeder & generator relay, recloser control relay, and others based on type.
The feeder & generator relay dominates the market segment in 2020 as it is used in primary and secondary distribution networks for feeder and generator applications. Additionally, the relay can operate with multiple functions like the voltage and power frequency and is widely accepted in the renewable energy sector.
Self-power relays are used as electronic protection for medium voltage applications and do not require any additional auxiliary voltage to get power. This factor results in a massive reduction in transformer and distribution substation maintenance. The other segment comprises a line protection relay and a voltage protection relay. The line protection relay provides a sub-cycle differential line current for a secure, reliable, and high-speed transmission solution. The feature of fault location allows users to isolate the line problem and restore the service quickly.
Electromechanical & Static Relay Segment Accounted for Largest Medium Voltage Protection Relay Market Share
The market is bifurcated into electromechanical & static relay and digital & numerical relay based on technology.
The use of digital & numerical relays has resulted in the revolution of relay technology due to continuous cost reduction factors, which led to the integration of significant functions. In addition, digital relays improve dependability, security, and the system's self-checking facility. Based on this factor, the digital and numerical relays segment will dominate the market in 2020.
The electromechanical and static relays typically solve the purpose of controlling the high-power electrical device of the system. They are generally used in general aviation and wireless technology industries, among others.
Feeder Application Segment Accounted for Largest Market Share
The market is segmented into the generator, transformer, transmission lines, bus bar, feeder, motor, and others based on application.
In 2020, the feeder application dominated the market segment as medium-voltage protection relays are used to protect the feeder from fault and allow the power grid to continuously supply energy.
The transformer unit has different types of relays. It compares the current inputs at both high and low voltage sides of the transformer and in generator applications, depending on the fault of different types of relays. The most common failure is the sudden loss of the generator, which creates a large mismatch of power between load and generator.
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Utility Segment Accounted for Largest Market Share
The market is segmented into utilities, industrial, railway, and others based on end-user.
In 2020, the utility industry witnessed the largest adoption of protection relay as it helps the utility operator to provide a reliable supply of energy to its customers. Any issues which can lead to system failure or equipment breakdown are overcome with the help of a protection relay.
Other industries such as railways use protection relays to monitor the overhead lines and location of faults within the substation across the rail network. Based on this factor, the acceptance of protection relay is expected to grow during the forecast period.
In the industrial sector, the growing complexity in industrial process and operation has resulted in opting for projection relays for improved reliability of electric supply.
Asia Pacific Medium Voltage Protection Relay Market Size, 2020 (USD Billion)
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The market has been analyzed across five key regions, North America, Asia Pacific, Europe, Latin America, and the Middle East & Africa.
Asia Pacific is the major region in the global market. In terms of value, the region held a share of 36.9% in 2020. The rail industry in Asia Pacific countries has been experiencing passenger demand over the period. Rail operators and authorities focused on various methods to meet the changing patterns and deliver a safe passenger experience supporting rail transformation to ensure a sustainable railway industry. Railways in the Asia Pacific are bringing rail operators, rail authorities together to discover the opportunities in technology and digital intermodal in communications, asset management, passenger experience, new rail projects across the Asia Pacific countries.
In North America, the utility industry experts are investing heavily in grid improvement to boost the reliability and use of electric power systems with a clean and reliable solution. This is expected to improve the market landscape of the protection relay market. For context, New Jersey-based Public Service Electric & Gas (PSE&G) has helped its customers to have greater access to lower-cost power and made it easier to move the electricity around the state. PSE&G has improved Northeast Grid and Susquehanna-Roseland transmission lines, which consist of smart sensors and relays in identifying the problem and redirecting the flow of electricity to keep customers online.
In Europe, the countries are focused on building a reliable rail network to provide citizens better mobility options and a better alternative to other modes of transportations with the increasing impact of transportation on the environment. With this context, the European Union is pursuing activity to improve the management of electrical infrastructure of rail transport and provide its citizens with better quality of rail network. Additionally, the European Union is also pursuing a balanced policy to encourage the development and use of new technologies to build a modern, competitive rail network to make rail transport a privileged instrument for European integration.
For example, the Regional Country Entrepreneurship and Development Index (REDI) tested electronic relay manufactured by GCF and used in the national and European Railway market for the first time. The electronic relay is said to be replaced with the electromechanical relays and provide distinct advantages of current inter-exchangeability and ensure the safety of railway operations.
Latin American countries such as Mexico and Brazil are moving forward with an ambitious and growing goal for clean energy and have been implementing energy and structural reform over the period to transform their energy power industry.
The increasing energy demand in the Middle East & Africa has driven the energy mix with the reliable generation with a balanced transmission distribution network to meet the energy demand. Organizations across the region are expanding and strengthening their transmission and distribution network to support the energy demand, which is expected to create enormous opportunities for the protection relay market across the region. For example, in November 2019, ABB, as part of the ADIPEC 2019, the Middle East oil & gas exhibition has showcased its electrification portfolio of a connected system to improve the energy consumption, operational, and maintenance cost of the system.
The company has showcased its UniGear Digital and MNS Digital switchgear which combines protection, control, and measurement of digital communications to enable a secure, flexible, and smart electrical network that can deliver power reliably and efficiently. Countries in GCC such as Saudi Arabia are announcing mega projects to develop and build integrated and modern public transport systems, which include railways in major cities to overcome the domination of urban transportation, which caused pollution, loss of productive time
ABB is Focusing on New Product Launches to Expand Its Product Line and Utilize Its Channels To Market New Products
The global market is fragmented and has witnessed high competition from several regional and global participants. ABB, Schneider Electric, and Schweitzer Engineering Laboratories (SEL) are the leading players in the market, accounting for a dominant share in 2020. ABB’s Electrification business area is currently a global leader in electrical products and solutions, operating in more than 100 countries, with over 200 manufacturing sites.
Contracts and agreements, investments and expansions, mergers and acquisitions, partnerships and collaborations, and new product launches are some of the primary strategies used by the key players. For instance, in May 2021, ABB launched a new addition to its Relion product family named REX610. It offers extensive life cycle services for optimal future usability and extended switchgear lifetime.
Other significant players include GE, Siemens, EATON, Mitsubishi Electric, and TOSHIBA Schlumberger. Key companies across the industry are continuously striving to introduce a highly efficient portfolio with environmental effects and easy integration features.
An Infographic Representation of Medium Voltage Protection Relay Market
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The market research report comprehensively assesses the industry by offering valuable insights, facts, industry-related detailed information, and historical data. To formulate the market research report, several methodologies and approaches have been adopted to make meaningful assumptions and views. Furthermore, the report covers a detailed analysis and information as per market segments, including type, technology, applications, end-user, and regions, helping our readers to get a comprehensive overview of the global industry.
Value (USD billion)
By Type, Technology, Application, End-user, and Region
Fortune Business Insights says that the global market size was USD 0.99 billion in 2020 and is projected to surpass USD 1.59 billion by 2028.
Asia Pacific dominated the market in terms of share in 2020.
Registering a CAGR of 5.82%, the market will exhibit a decent growth rate during the forecast period (2021-2028).
Based on type, the digital & numerical relays segment is anticipated to hold a significant share and dominate the market during the forecast period.
The rising initiatives for the integration of protection relays with renewable energies are the key factor driving the market growth.
ABB, General Electric, Siemens, Schneider Electric, and Schweitzer Engineering Laboratories are the key participants operating in the market.
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