Substation Automation Market Size 2024-2028

The substation automation market size is estimated to grow by USD 17.54 billion at a CAGR of 7.01% between 2023 and 2028. The market is driven by the increasing demand for electricity and the need to reduce energy losses, is driving market growth by increasing the adoption of advanced transmission and distribution technologies. Advancements in communication and connectivity technologies, driven by the growing need for real-time monitoring and control of power grids, are also boosting market expansion by enabling smarter and more efficient grid operations. Additionally, the growing demand for grid resilience and security, driven by the increasing frequency and severity of grid disruptions, is driving the adoption of technologies and solutions that enhance grid resilience and security. Overall, these factors are driving the growth of the power transmission and distribution market and driving innovations in grid technologies and solutions.  

Market Forecasting and Size

Market Forecast 2024-2028

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Market Segmentation

By End-user

The market share growth by the utilities segment will be significant during the forecast period. The utilities sector plays a critical role in the market. Utility companies are increasingly adopting substation automation solutions to optimize their operations with the rising demand for electricity and the need to modernize power grids.

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The utilities segment was the largest and was valued at USD 19.55 billion in 2018. To enhance asset management strategies, utility companies are leveraging substation automation. Utilities can monitor and analyze the performance and health of substation equipment by implementing advanced software solutions that help in optimizing maintenance schedules, minimizing downtime, and extending the lifespan of critical assets. For instance, predictive maintenance algorithms can detect early signs of equipment failure and schedule repairs before a major disruption occurs. Therefore, such benefits are anticipated to augment the adoption of substation automation in the utility sector, which will drive the growth of the utility segment in the market during the forecast period.

By Type  

Based on type, the market has been segmented into transmission and distribution. The transmission segment will account for the largest share of this segment.? Substations need to effectively manage the transmission of power from these decentralized sources with the increasing adoption of renewable energy, such as solar and wind power. This needs the integration of intelligent devices and communication systems that can seamlessly interface with renewable energy sources and the EV charging infrastructure. For instance, by utilizing advanced communication and control systems, utilities can dynamically manage the transmission of renewable energy based on availability and demand, balancing the generation and consumption of power effectively. Therefore, such advantages are anticipated to advance the adoption of transmission technology, which will drive the growth of the transmission segment in the market during the forecast period.

By Region

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APAC is estimated to contribute 35% to the growth by 2028. Technavio’s analysts have elaborately explained the regional trends, drivers, and challenges that are expected to shape the market during the forecast period. The Substation Automation market is witnessing significant growth due to the increasing investment in the modernization of power grid networks for Intelligent grid implementation. This trend is driven by the need for improved power management, reliability, and safety in the power supply system. The integration of renewable energy projects into the power grid network is also boosting the demand for Substation Automation. Key components of Substation Automation include Load Tap Controllers, Recloser Controllers, and Remote Terminal Units. These modules enable real-time monitoring, predictive data analysis, and remote control of power supply systems. Smart cities and infrastructure development are also fueling the demand for Smart Electric Substations, which utilize smart grid programs and smart meters for efficient power management. Low-carbon initiatives and the steel industry's shift towards sustainability are creating new opportunities for Substation Automation. The use of sensors, smart electronic devices, and protection systems in Substation Automation enhances the safety and security of power supply systems. Outages and potential issues can be identified and addressed proactively through predictive data analysis and recommendations. Overall, the market holds immense potential for growth in the context of the evolving power supply landscape.

 Market Dynamics

The market is experiencing rapid growth driven by the adoption of digital technology in conventional substations to support smart cities and the increasing use of electric and hybrid vehicles. As data centers and renewable energy projects expand, the need for efficient power management is critical. Automation systems in substations enhance energy consumption efficiency, with a focus on substation automation systems for protection, control, and monitoring. These systems leverage communication capabilities, including remote terminal units and smart electronic devices, to enable real-time monitoring and control. Digital technologies are revolutionizing electrical power transmission and distribution systems, integrating control systems with communication networks and sensors for enhanced operation and maintenance of substation equipment. 

Key Market Driver - Growing demand for grid resilience and security 

The market is experiencing a growing demand for grid resilience and security, driven by concerns over power outages and the need to enhance grid performance. Utilities and grid operators are increasingly adopting substation automation solutions to improve the reliability and security of their power systems. These solutions enable utilities to enhance their communication capabilities, utilize remote terminal units, and integrate smart electronic devices.

Additionally, by leveraging digital technologies and communication networks, utilities can implement sensors for real-time monitoring, leading to more efficient grid management. These solutions enable utilities to monitor and control various grid components, such as transformers and circuit breakers, in real-time. Further, efficient management of grid assets can help utilities prevent equipment failures, reduce maintenance costs, and enhance overall grid reliability. Therefore, these factors are expected to drive the demand for substation automation and contribute to the market's growth in the forecast period.

Significant Market Trends- Rising demand for EVs and hybrid electric vehicles (HEVs) 

The market is experiencing a substantial rise in demand for EVs and HEVs. Increasing adoption of sustainable transportation solutions and the growing concern over environmental issues are the major attributes that increase demand.  EVs and HEVs are more environmentally friendly alternatives to traditional gasoline-powered vehicles as they produce zero or significantly lower emissions. The automotive industry is shifting toward producing more electric and hybrid vehicles as governments worldwide enforce more stringent regulations to combat climate change. The trust in EVs and HEVs increases, further boosting their sales as technology continues to improve. Thus, the need for efficient and reliable charging infrastructure provided by substation automation has become paramount.

Moreover, the declining prices of EVs, along with government incentives and subsidies, have made them a possible option for consumers. This led to an increase in the demand for substation automation as more individuals and businesses invested in EVs and HEVs, necessitating the development of robust charging infrastructure. Therefore, these factors are anticipated to expand the demand for substation automation, which will drive the growth of the market during the forecast period.

Major Market Challenge- Rise in skilled workforce shortage

The rise in the shortage of skilled workforce is a significant challenge that is posing a concern for businesses operating in the electronics industry and hinders market growth. The rapid growth of the electronics industry is one of the primary reasons for the skilled workforce shortage in the market. Substation automation systems are experiencing increased adoption owing to their capacity to improve operational efficiency and reduce costs. The rising demand for these systems is outpacing the supply of skilled professionals who can effectively design, install, and maintain them. 

Also, advancements in technology have also contributed to the shortage. Substation automation systems now integrate with advanced components such as AI, IoT, and cloud computing. The shortage of professionals with the necessary skills to operate and troubleshoot these advanced systems is adding to the workforce gap. Therefore, these factors are anticipated to restrict the growth of the market during the forecast period.

Who are the Major Market Companies?

Companies are implementing various strategies, such as strategic alliances, partnerships, mergers and acquisitions, geographical expansion, and product/service launches, to enhance their presence in the market.

ABB Ltd.- The company offers substation automation solutions such as Smart substation control and protection SSC600. 

We also have detailed analyses of the market’s competitive landscape and offer information on 20 market companies, including ABB Ltd., Arteche Lantegi Elkartea SA, Beijer Electronics Group AB, Cisco Systems Inc., Eaton Corp. Plc, General Electric Co., Hitachi Ltd., Mitsubishi Electric Corp., OHB SE, Renewable Energy Systems Ltd., Schneider Electric SE, Schweitzer Engineering Laboratories Inc., Siemens AG, Texas Instruments Inc., The Weir Group Plc, Toshiba Corp., TRC Companies Inc., Trilliant Holdings Inc., ZIV Automation, and SHENZHEN GUOWANG NARI TECHNOLOGY CO. LTD. 

Technavio report provides an in-depth analysis of the market and its players through combined qualitative and quantitative data. The analysis classifies companies into categories based on their business approaches, including pure-play, category-focused, industry-focused, and diversified. Companies are specially categorized into dominant, leading, strong, tentative, and weak, based on their quantitative data analysis.  

Segment Overview

The market research and growth report provides comprehensive data (region-wise segment analysis), with forecasts and estimates in "USD Billion" for the period 2024 to 2028, as well as historical data from 2018 to 2022 for the following segments.

• End-user Outlook 
  • Utilities
  • Steel
  • Mining
  • Transportation
  • Oil and gas

• Type Outlook 
  • Transmission
  • Distribution

• Region Outlook 
  • North America
    • The U.S.
    • Canada
  • South America
    • Chile
    • Brazil
    • Argentina 
  • Europe
    • U.K.
    • Germany
    • France
    • Rest of Europe
  • APAC
    • China
    • India
  • Middle East & Africa
    • Saudi Arabia
    • South Africa
    • Rest of the Middle East & Africa

Market Analyst Overview

The market is witnessing rapid growth driven by advanced technologies and the need to modernize aging energy infrastructure. Key players like Equinor are investing in digital substation products and intelligent grid solutions to enhance energy transition and achieve carbon neutrality. Utilities are embracing distribution automation and deploying smart secondary substations to optimize electric grid usage patterns and ensure reliable electricity supply. With predictive data and remote monitoring, fault detection and automatic rerouting are enhancing system performance and worker safety. Renewable power generation and highly efficient energy solutions are driving the adoption of smart grid programs and large-scale renewable energy systems, propelling the market towards a low-carbon future.

Additionally, the market is experiencing significant advancements with the introduction of technologies such as capacitor bank controllers and load tap controllers. Copper wire and optical fiber communication channels are revolutionizing data transmission, ensuring seamless communication between distribution circuits and substations. Utilities are prioritizing digital systems factories to enhance equipment and services and streamline modernization efforts. Investments in smart grid programs and smart meters are driving electrification initiatives and optimizing electricity transmission. Innovations like smart city infrastructure and intelligent electronic devices are reshaping the utility industry, while low-carbon initiatives and solar and wind energy integration are fostering sustainability. Strategic mergers and acquisitions among suppliers are fueling growth, ensuring a robust future for substation automation.

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What are the Key Data Covered in this Market Research Report?

• CAGR of the market during the forecast period
• Detailed information on factors that will drive the growth of the market between 2024 and 2028
• Precise estimation of the size of the market growth and trends and its contribution to the market in focus on the parent market
• Accurate predictions about upcoming market trends and analysis and changes in consumer behavior
• Market growth and forecasting across North America, APAC, Europe, South America, and Middle East and Africa
• A thorough market analysis and report of the market’s competitive landscape and detailed information about companies
• Comprehensive analysis of factors that will challenge the growth of market  companies

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