Global power grid market is projected to witness a CAGR of 5.48% during the forecast period 2024-2031, growing from USD 269.77 billion in 2023 to USD 413.39 billion in 2031. Rapid acceleration towards renewable energy sources, such as solar, wind, and hydro, is expected, leading to the deployment of grids for better adaptability, grid flexibility, and energy storage solutions. The future holds significant opportunities for the market as the number of grids is expected to increase, including the deployment of smart grid technology using advanced sensors, IoT devices, and communication networks. This enables real-time monitoring, heightens fault detection, and delivers better energy management, along with higher operations efficiency.
In addition to the shift towards an increasingly decentralized power generation model, the increase in prosumers, that is, consumers who partly generate their own electricity through solar panels and other technologies, is driving the growth of the market. The technology behind decentralized energy production must be integrated into the grid, leading to huge breakthroughs in storage, such as in battery systems and pumped hydro storage. Intermittent renewable power generation balancing would make it stable and ensure the supply of power goes uninterrupted.
The advent of electric vehicles, the development of charging infrastructure, and the increased demand for electricity during peak hours would require specific grid management, leading to a higher demand for power grids. Furthermore, the growth in digital infrastructure would create a need to protect power grids from natural calamities and cyber-attacks. Investment in such areas in cybersecurity measures and infrastructure upgradation would be paramount.
For instance, in July 2024, Siemens AG launched Gridscale X, paving the way for autonomous grid management. It enables utilities to scale grid capacity and increase DER visibility, which is essential for grid decarbonization. With software that is simple to implement and quick to integrate into current IT and OT ecosystems, Gridscale X enables fast scaling of grid capacity, handling of complex distributed energy resources, and increased grid flexibility.
Energy Demand and Renewable Energy Integration to Transform Market Dynamics
Rapid urbanization escalates electricity usage in homes, industries, and businesses. Future cities will demand huge amounts of energy to power infrastructure, public services, and technological advancement. Increased use of electronic vehicles, smart appliances, and digital technologies further drives the demand for energy. As consumers increase their number of electronic goods, the demand for constant and reliable power rises. Hence, governments across the globe are focusing on multiplying the energy supply through the addition of new distribution networks and grids.
The transition of fossil fuels to renewable sources, such as solar, wind, hydro, and biomass, constitutes one of the significant drivers for the market. Countries around the world are setting ambitious targets for adopting renewable sources of energy. Non-dispatchable or variable intermittent renewable energy sources must be integrated into the grid, requiring the development of sophisticated systems capable of managing variable supply. Complex electrical circuits and distribution networks demand an upgrade while expanding the network range as well. Hence, governments across the globe are focusing on upgrading the grid systems for better energy distribution.
Read More: https://www.marketsandata.com/industry-reports/power-grid-market
For instance, in May 2024, the United States government launched an initiative to modernize the electricity grid, targeting 21 states. The deployment’s agenda is to enhance the capacity, reliability, and resilience of the nation’s electricity grid. Arizona, California, Colorado, Delaware, Hawaii, Illinois, Kentucky, Maine, Maryland, Massachusetts, Michigan, New Jersey, New Mexico, New York, North Carolina, Oregon, Pennsylvania, Rhode Island, Washington, and Wisconsin are the states that are taking part.
Technological Advancements and Mega Projects to Fuel Market Growth
Smart grid technology comprising real-time data management and automated demand response is expected to transform the power grid industry. The upgradation of energy storage systems, including battery storage and pumped hydro storage, is making the grids more efficient and safer. With the introduction of smart grids, real-time observation of energy flow is done through new sensors and communication technologies, hence enhancing operational efficiency and reliability. Utility companies are able to regulate consumer energy usage during peak times through incentives to customers to reduce consumption. Hence, the load is balanced, putting less strain on the grid. With the invention of technologies, such as lithium-ion and flow batteries, the excess energy generated from the source can be stored and used at times when high demand is required. This capability is more critical in the integration of solar and wind power into the grid.
The addition of microgrids along with renewable energy is expected to fuel the market growth. Microgrids can operate independently or in conjunction with the main grid, enhancing resilience and energy security, especially in remote or disaster-prone areas.
For instance, in July 2024, the Western Australian government and Horizon Power (Regional Power Corporation) announced the release of the renewable hydrogen microgrid. The system features a 348-kW hydrogen electrolyzer and a 100-kW fuel cell. City drinking water will be processed through a reverse osmosis system before being used by the electrolyzer.
Renewable Power Source to be the Fastest Growing Segment
Renewable power source is the fastest growing segment in terms of modern power grids. While conventional power sources hold the major market share, renewable energy is being considered as the energy of the future. With concerns around climate change, rising tides behind clean energy are turning out to be key global impetus. The protection of greenhouse gas output reductions is becoming a central trend for nations and organizations. Many countries have set ambitious sustainability targets, setting their sights on net-zero emissions in the mid-century, leading to higher investments in renewable energy technologies.
Technological progress would lead to better efficiency and performance in sunlight and wind energy technologies, and innovative forms of energy storage. These advancements yield greater power output and increased energy reliability. Nearly every country has implemented subsidies, tax incentives, and renewable portfolio standards (RPS), which promote greater renewable energy adoption. Such policies make it more economically advantageous for businesses and consumers to invest in renewable energy. Emerging economies such as China and India are focusing on the adoption of renewable energy through the expansion of grid networks specific to renewable energy transmission.
For instance, in April 2024, Power Grid Corporation of India, a state-owned corporation, won 3 transmission projects in a competitive bidding. The three projects would help evacuate power from renewable energy projects in Rajasthan and Gujarat. The Transmission System project is an effort to reinvent or renovate power for Rajasthan. The project entails building a new 765/400/220 kV pooling substation in Mandsaur, extending the Madhya Pradesh substation’s related bays, and building a 765 kV D/C transmission line.
North America Dominates Power Grid Market Share
North America leads the share of the global power grid market. Higher investments, along with the modernizing grids, propel the region’s growth in the market. Established infrastructures, along with rapid investments in grid modernization and usage of diverse energy sources, are expected to add value to the regional market. The power grid infrastructure of North America is well-developed and mature. Large transmission and distribution networks exist in the United States and Canada, providing ways for an efficient electricity supply. In the region, a decent energy mix of natural gas, coal, nuclear, and a rising share of renewables has been found to stabilize the grid and provide flexibility in meeting demand.
For instance, in February 2024, The United States Department of Energy (DOE) announced a Request for Proposals (RFP) for the second round of the Transmission Facilitation Program. On October 20, 2023, DOE declared that it started the first round of negotiations for a capacity contract worth up to USD 1.3 billion. The contract constitutes three transmission lines that cross six states and add 3.5 gigawatts of additional grid capacity across the United States, which is roughly equivalent to powering 3 million more people.
While North America leads the market share, Asia-Pacific is projected to be the fastest growing market. Rapid urbanization and industrialization, along with government initiatives and investments, are anticipated to accelerate the region’s growth. There is a strong push toward adopting smart grid technologies and energy storage solutions, enabling better management of electricity supply and demand. This technological shift is supported by the public and private sectors.
Future Market Scenario (2024 – 2031F)
1. Power expansion projects, along with the advent of renewable energy, are anticipated to shape the market dynamics.
2. Technological advancements and the adoption of smart and microgrids are projected to propel the market growth.
3. Smart grid technologies with increased renewable integration are likely to add decentralized energy generation and hybrid systems.
4. Energy storage expansion and focus on cybersecurity are expected to add value to the market growth.
Report Scope
“Power Grid Market Assessment, Opportunities and Forecast, 2017-2031F”, is a comprehensive report by Markets and Data, providing in-depth analysis and qualitative and quantitative assessment of the current state of global power grid market, industry dynamics, and challenges. The report includes market size, segmental shares, growth trends, opportunities, and forecast between 2024 and 2031. Additionally, the report profiles the leading players in the industry, mentioning their respective market share, business models, competitive intelligence, etc.
Contact
Mr. Vivek Gupta
5741 Cleveland street,
Suite 120, VA beach, VA, USA 23462
Tel: +1 (757) 343-3258
Email: info@marketsandata.com
Website: https://www.marketsandata.com/