The Transmission and Distribution (T&D) equipment market in Europe is expected to grow at a CAGR of around 4% during the period 2017-2021, with the rise in demand mostly fuelled by growing offshore wind generation, according to the latest market study released by Technavio.
“In Europe, the investment in transmission and distribution equipment is likely to rise due to the increase in aggressive renewable energy mandates by the EU,” Thanikachalam Chandrasekaran , a lead analyst at Technavio for power research.
”The wind power generation, especially from offshore wind turbine installations in the North Sea, will require different types of T&D equipment, including switchgear and control gears, power cables, power transformers, and distribution transformers.”
The power cables segment accounted for the largest market share of the T&D market in Europe, the report shows. This is primarily due to the high number of grid interconnections among countries and the high renewable power generation in the region.
Grid interconnection projects are promoted to create an integrated energy market and to enhance the security of energy supply. In these projects, high loads of electricity will be transferred from one European country to another, in turn, driving the demand for power cables in the region, the report says.
“Europe is the leader for offshore wind power generation in the world, and these wind farms are located miles away from the grid requiring power to be transmitted over long distances, which drives the need for power cables in the region,” said Thanikachalam.
Key markets for transformers in Europe include Germany, France, and the UK. Renewable energy sources are well-established and well-integrated into electricity grids in Europe.
For the past decade, power utilities in Europe have profoundly adopted the wind, solar, hydro, and other forms of renewable energy sources. Also, the region is also home to well-defined T&D infrastructure. Therefore, the transformers market in Europe is expected to witness steady growth. Technavio expects most of the market demand to stem from renovation activities.