Substation Automation Market Overview
Global Substation Automation Market reached USD 41 billion in 2022 and is expected to reach USD 67 billion by 2031, growing with a CAGR of 6.5% during the forecast period (2024-2031). The market for substation automation has been experiencing significant growth in recent years.
Factors driving this growth include increasing demand for electricity, aging infrastructure, the need for grid modernization and the integration of renewable energy sources.
Additionally, the rising focus on reducing transmission and distribution losses, improving grid resilience and implementing smart grid solutions has further fueled the demand for substation automation.
China has one of the largest electricity networks globally and its continuous investments in power infrastructure have propelled the demand for substation automation solutions. The country's extensive network of substations presents a substantial market for automation technologies.
China's commitment to modernizing its power grid and improving operational efficiency has further contributed to the growth of the substation automation market, accounting for more than 44.3% of the regional market share in 2022.
Market Scope
| Metrics | Details |
| CAGR | 6.5% |
| Size Available for Years | 2021-2030 |
| Forecast Period | 2023-2030 |
| Data Availability | Value (USD ) |
| Segments Covered | Component, Installation, Communication, End-User and Region |
| Regions Covered | North America, Europe, Asia-Pacific, South America and Middle East & Africa |
| Fastest Growing Region | Asia-Pacific |
| Largest Region | North America |
| 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, Porter’s Analysis, Pricing Analysis, Regulatory Analysis, Supply-Chain Analysis and Other key Insights. |
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Market Dynamics
Increasing Global Investment in Smart Grid Infrastructure
The rising investment in smart grid infrastructure reflects a global shift towards upgrading and modernizing traditional power grids. Smart grids integrate advanced technologies, including substation automation, to enhance the efficiency, reliability and sustainability of power distribution. Substation automation is crucial in enabling smart grid functionalities by automating monitoring, control and protection systems within substations.
As energy demand continues to increase, there is a growing need for optimizing grid efficiency. Substation automation enables real-time monitoring, fault detection and predictive maintenance, leading to improved energy management, reduced downtime and enhanced operational efficiency. Smart grid investments prioritize deploying substation automation solutions to achieve these efficiency goals.
High installation and maintenance costs
Installing substation automation systems requires a significant upfront investment, including purchasing automation equipment, communication infrastructure and software. These costs can be substantial, especially for large-scale substations or utility companies with extensive networks. The high initial investment can deter some organizations from adopting or expanding their automation infrastructure.
In many cases, existing substations need to be retrofitted or upgraded to incorporate automation technology. Retrofitting can be complex and costly, involving the integration of new automation devices with legacy equipment, as well as the installation of communication networks and control systems. The expense and technical challenges associated with retrofitting may discourage some companies from pursuing automation.
Market Segment Analysis
The Global Substation Automation Market is segmented based on component, installation, communication, end-user and region.
The Growing Power Infrastructure and Greenfield Projects
The growing power infrastructure and greenfield projects play a significant role in driving the growth of the New Installation segment in the global substation automation market. The electricity demand continues to rise globally due to facilitation growth, urbanization and industrialization.
New power infrastructure, including substations, must be installed to meet this growing demand. This power infrastructure expansion creates opportunities to implement substation automation systems in new installations.
Substation automation technology has advanced significantly, providing enhanced functionalities and improved performance. When building new substations, utilities and project developers can leverage these advancements by installing the latest substation automation systems.
This allows them to benefit from advanced features such as real-time monitoring, predictive maintenance, intelligent grid optimization and seamless integration with renewable energy sources. Therefore, the new installation segment dominates the installation segment with acquiring 42.5% of the total segmental share at the global scale.
Market Geographical Penetration
Dominance of North America in the Global Substation Automation Market and Key Initiatives for Grid Resilience
The North American region dominates the global substation automation market. U.S. accounts for the biggest market share within the region due to massive energy infrastructure upgrades in various parts of the country. Multiple projects are currently underway to automate substations and power distribution services.
PG&E's microgrid solutions for 2020 focus on improving grid resilience and keeping the lights on for customers in communities with a high probability of encountering a future PSPS event. PG&E will also employ temporary generation at safe-to-energize substations during PSPS events to help safe-to-energize customers and areas affected by transmission line outages.
During PSPS events, it is preparing 63 substations to connect temporary generators as needed, subject to operational logistics and generator availability. Additionally, the U.S. and Canada are the headquarters of key players in the substation automation market. Therefore, the U.S. and Canada hold more than 95.7% of the regional shares during the forecast period.
Market Competitive Landscape
The major global players include Hitachi Energy Ltd., Siemens Energy, General Electric, Cisco Systems, Inc., Schneider Electric, Eaton, NovaTech, LLC., Honeywell International Inc., CG Power and Industrial Solutions Ltd and Schweitzer Engineering Laboratories, Inc.
COVID-19 Impact on Substation Automation Market
COVID Impact
The Global Substation Automation Market experienced severe impacts on revenue streams in 2020 due to the COVID-19 pandemic. Manufacturing of substation automation components such as intelligent electronic devices (IEDs) was disrupted due to government-imposed lockdowns and movement restrictions.
The pandemic delayed the deployment and field testing of new products and technologies. Substation automation is a market where growth is derived from innovating new products. The pandemic, thus, affected the revenues of various companies involved in the market due to reduced manufacturing and delayed product launches.
AI Impact
AI has had a significant impact on the global substation automation market. Substation automation refers to the use of advanced technology to monitor, control and protect electrical substations, which are vital components of power transmission and distribution systems.
AI enables the automation of various substation processes, reducing the need for manual intervention. It helps in real-time monitoring of equipment performance, fault detection and predictive maintenance. This improves overall operational efficiency, minimizes downtime and enhances the reliability of power supply.
Russia-Ukraine War Impact
The Russia-Ukraine war has implications for energy security in the region. Countries may seek to diversify their energy sources and reduce dependence on specific suppliers. As a result, there might be an increased focus on improving the resilience and efficiency of existing electrical infrastructure by implementing substation automation technologies.
Key Developments
- On October 11, 2021, ZIV Automation was selected by Spanish multinational conglomerate Acciona to offer the protection and control systems for the substations that the company intends to build between 2021 and 2023. The entire supply of SAS systems has been given to ZIV Automation, who was selected as the preferred SAS supplier.
- On February 22, 2021, The latest in digital substation technology is combined with the distinctive predictive, prescriptive and prognostic capabilities of Hitachi's market-leading Lumada Asset Performance Management (APM) solution in the launch of the Smart Digital Substation offering, which Hitachi ABB Power Grids announced.
The announced integration of Hitachi ABB Power Grids' Digital Enterprise software into Hitachi's Lumada ecosystem marked the start of a new phase of innovation, which includes the Smart Digital Substation.
- On June 30, 2020, To improve the power grid's modularity, interoperability and scalability to speed up the worldwide drive towards carbon neutrality by 2050, LF Energy introduced its Digital Substation Automation Systems (DSAS) initiative.
Why Purchase the Report?
- To visualize the Global Substation Automation Market segmentation based on component, installation, communication, end-user and region, as well as understand key commercial assets and players.
- Identify commercial opportunities by analyzing trends and co-development.
- Excel data sheet with numerous substation automation market level data points with all segments.
- PDF report consists of a comprehensive analysis after exhaustive qualitative interviews and an in-depth study.
- Product mapping available as Excel consisting of key products of all the major players.
The Global Substation Automation Market Report Would Provide Approximately 69 Tables, 74 Figures And 234 Pages.
Target Audience 2023
- Manufacturers/ Buyers
- Industry Investors/Investment Bankers
- Research Professionals
- Emerging Companies
