The flexible AC Transmission System (FACTS) Market is Segmented By Configuration (Series, Shunted, Combined), By Product (Static Var Compensator (SVC), Thyristor Controlled Series Capacitor (TCSC), Static Synchronous Compensator (STATCOM), Unified Power Flow Controller (UPFC)), By Voltage (132 kV to 220 kV, 220 kV to 660 kV, Above 660 kV), By End-User (Utilities, Renewables, Smart grid, Railways, Metals and Mining, Oil and Gas), and By Region (North America, Latin America, Europe, Asia Pacific, Middle East, and Africa) – Share, Size, Outlook, and Opportunity Analysis, 2022-2029
Flexible AC Transmission System (FACTS) Market Size, Demand Insights
The global flexible AC transmission system market is growing at a CAGR during the forecast period (2022-2029).
Flexible AC Transmission System (FACTS) Market Scope and Summary
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Metrics |
Details |
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Market CAGR |
High |
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Segments Covered |
By Configuration, By Product, By Voltage, By End-User, and By Region |
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Report Insights Covered |
Competitive Landscape Analysis, Company Profile Analysis, Market Size, Share, Growth, Demand, Recent Developments, Mergers and acquisitions, New Product Launches, Growth Strategies, Revenue Analysis, and Other key insights. |
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Fastest Growing Region |
Asia Pacific |
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Largest Market Share |
North America |
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Flexible AC Transmission Systems, abbreviated as FACTS, refer to a group of resources utilized to overcome specific constraints in electrical networks' static and dynamic transmission capability. Flexible AC transmission systems are alternating current with power-electronics-based and other static controllers to improve control and power transfer capability. The basic goal of these systems is to provide the network with inductive or capacitive reactive power tailored to the network's specific needs as rapidly as feasible while also enhancing transmission quality and efficiency.
The stability and performance of transmission systems will significantly improve with flexible AC transmission systems. Utility companies will be able to utilize their existing transmission networks better, significantly increase their line networks' availability and reliability and improve dynamic and transient network stability while ensuring a higher quality of supply with flexible AC transmission systems.
Flexible AC Transmission System (FACTS) Market Dynamics and Trends
The demand for flexible AC transmission systems is mainly driven by the increasing global investment in electric grid infrastructure. It is the most important driver for the market. The high installation and maintenance costs of flexible AC transmission systems are key factors in limiting the growth of this market.
Increasing global investment in electric grid infrastructure
Years of chronic underinvestment in energy transmission and distribution infrastructure, including in developed countries, have left electric grids unable to deal with a surge in power demand, especially during the summer months. As a result, rolling blackouts have become common in many countries during peak power demand. Companies, organizations, and governments are preparing for a major energy transition in the coming years. A global switch to renewable energy is underway to decarbonize energy and mitigate the severely damaging effects of climate change.
Several major global car manufacturers have pledged to completely discontinue the production of internal combustion engine (ICE) cars by the end of the decade and switch completely to electric vehicles (EVs). It will create a massive demand for electricity, which the current infrastructure cannot handle. As rapid industrialization and economic development occur, countries are ramping up investment in electricity infrastructure to keep up with growing demand and improve energy access for the population. Although electricity generation has gone up, transmission and distribution have yet to catch up. Flexible AC transmission systems offer reliable and economical means of delivering electricity to the last mile.
High installation and maintenance costs
The first phase in installing a flexible AC transmission system is particularly capital intensive, necessitating a variety of contemporary testing instruments, components, and equipment. As the need for solid-state transformers to be integrated into the electrical grid has grown, costs have risen. Flexible AC transmission systems require extensive collaboration beyond traditional organizational boundaries, massive process reform, and strict governance to assure exceptional quality throughout their service life.
Large investments in flexible AC transmission networks may add to a government's financial woes. After deployment, high operations and maintenance expenses are also a concern for utility providers. Given the high expenses of maintaining energy infrastructure, a drop in revenue can significantly influence utility providers' ability to undertake upkeep. Flexible AC transmission systems have significant maintenance and installation costs, limiting their use and posing a major impediment to the market's growth.
COVID-19 impact on Flexible AC Transmission System (FACTS) Market Growth
The global flexible AC transmission system market experienced severe problems in 2020 due to the COVID-19 pandemic. Governments imposed lockdowns and other movement restrictions to curb the spread of the pandemic. As a result, only maintenance activities could be carried out on electrical infrastructure. Major overhauls and new grid construction were delayed till the COVID cases receded.
Manufacturers outsource the numerous components necessary to produce flexible AC transmission systems to overseas subcontractors. The supply chain is global, encompassing various small, medium, and large businesses. As a result, the supply chain is fragile and highly susceptible to external shocks. The global pandemic has wreaked havoc on the global supply chain and logistics, posing a challenge for manufacturing flexible AC transmission systems. The backlog is unlikely to be cleared until the end of 2021. Many new energy infrastructure projects are on hold due to material shortages and logistical issues in the supply chain.
The short-term impact of the COVID-19 pandemic has been relatively severe for the flexible AC transmission system market. The pandemic led to a difficult economic situation forcing cuts to capital expenditures and new investments by organizations and governments. Because governments emphasize investment in the energy sector to maintain energy security, the pandemic will have little influence on the worldwide flexible AC transmission system market's medium to long-term growth. Investment is also considered a method to stimulate national economies after the economic effects of the pandemic. Flexible AC transmission systems are in high demand and this trend is projected to continue in the coming years.
Flexible AC Transmission System (FACTS) Market Segment and Shares Analysis
The global flexible AC transmission system market is segmented into configuration, product, voltage, end-user, and region. The flexible AC transmission system market is segmented further into 132 kV to 220 kV, 220 kV to 660 kV, and above 660 V based on voltage. 220 kV to 660 kV leads this segmentation since it is the most widely used flexible AC transmission system voltage type. Upgrading small-scale industrial platforms and large-scale commercial setups throughout emerging regions has significantly boosted 220 kV to 660 kV voltage types. Furthermore, suburban migration promotes the development of large residential complexes and multi-story flats, increasing the adoption of this voltage type for electricity transmission.
Flexible AC Transmission System (FACTS) Market Geographical Analysis
Asia-Pacific has the leading regional share in the global flexible AC transmission system market. The region accounts for the largest market share, primarily due to major investments in electricity infrastructure, renewable green energy, and ongoing industrialization. The vast majority of the demand in the region is generated by emerging countries such as China, India, Thailand, Malaysia, Vietnam, and Indonesia.
Rapid urbanization, industrialization, and growing renewable energy adoption are key factors in spurring the region's demand for flexible AC transmission systems. China, India, Vietnam, Thailand, Malaysia, and Indonesia are some of the leading solar energy producers in the region. The increasing adoption of high-speed rail is a major factor fueling the demand for flexible AC transmission systems. China has the largest high-speed rail network in the world. Japan is another country with a well-developed high-speed rail network. India is also working on building an extensive high-speed rail network. The Asia-Pacific region is expected to retain the largest share of the global flexible AC transmission system market.
Flexible AC Transmission System (FACTS) Companies and Competitive Landscape
The global flexible AC transmission system market is competitive due to the availability of a wide range of solutions that cater to different commercial applications. Some of the major players contributing to the growth in the segment are Hitachi Energy Ltd., Siemens, General Electric, Mitsubishi Electric Corporation, Infineon Technologies AG, NR Electric Co., Ltd., Hyosung Heavy Industries, American Superconductor, CG Power & Industrial Solutions Ltd. and Liaoning Rongxin Xingye Power Technology Co., Ltd. The major players in the flexible AC transmission systems market adopt several strategies such as product portfolio expansion, new product launches, joint ventures, and collaborations, contributing to global growth in the industry.
Hitachi Energy Ltd.
Overview: Hitachi Energy Ltd. is a multinational engineering and technology services company specializing in designing and manufacturing energy equipment and services. The company’s business is segmented into product systems, design services, engineering, and energy consulting. The company supplies its products and services to many global companies in the utility, energy, transportation, and engineering sectors. The company’s facilities are located in more than 140 countries globally. Hitachi Energy Ltd. was founded through a joint venture between Hitachi and ABB and is headquartered in Geneva, Switzerland.
Product Portfolio
- SVC Light is the company’s brand name for offering static var compensators (SVC). It is based on a common technology platform alongside a high-voltage direct current (HVDC) transmission application. The system is equipped with powerful semiconductors for carrying out switching operations. SVC Light is suitable for systems with voltages up to 69 kV and converter ratings of -/+ 400 Mar.
Key Developments
- In 2021, Hitachi Energy Ltd. announced a deal with the Swiss Federal Railway to deploy its flexible AC transmission system offering to expand the Geneva rail network. As more commuters utilize the France-Switzerland cross-border Leman express, the rail network is expanding.
Frequently Asked Questions
What is the Projected CAGR value of the Flexible AC Transmission System (FACTS) Market?
The Flexible AC Transmission System (FACTS) Market is expected to grow at a high CAGR from 2022 to 2029.
Which region controlled the global market during 2022-2029?
North America region Controls the Flexible AC Transmission System (FACTS) Market during 2022-2029.
Which is the fastest-growing region in the Flexible AC Transmission System (FACTS) Market?
Among all regions, Asia Pacific is the fastest-growing market share during the forecast period.
