Increasing the expanse of the reach of power enabled through meticulous distribution is picking up pace in India and as a result, the India distribution transformer market is expected to rise at a CAGR of more than 4 percent during the period of 2020-2025. The growth is going to be driven by rising energy demand
from industries and rapid adoption of advanced transmission and distribution
systems. However, there are some factors that are going to impede the market growth as well and they are mainly related to the long drawn out government procedures and the red tape pertaining to the implementation of projects.
To meet the growing demand for power and making it reach every nook and corner of the country, India has been multiplying its transformation capacity in the past few years. If we look at the voltage wise breakup of AC transformation capacity, 40 percent of the total capacity comprises 220 kv level, 36 percent at 400 kv and the the remaining 24 percent at 765 kv level. But in terms of growth, the transformation capacity at 765 kv level has seen highest growth in the last five years.
The CAGR at which it has grown is 13.7 percent. The other two levels of transformation capacity have grown at comparatively slower rates of 12percent and 6.8 percent. This shift is a result of the utilities increasingly opting for higher voltage level to be able to enhance their transmitting power while keeping the operational loss low.
Expanding the transmission and distribution
It is initiatives like these that are going to meet the needs of increasing urbanization and commercialization. There is a sharper focus on expanding the transmission and distribution system. More and more transmission lines are being laid and new substations are being installed in order to fill the lacuna between the power demand and supply. Smart grids are proving to be the way forward in enabling the same and bridging the gap. They are being seen as an efficient and economical medium for power generation systems to reduce their carbon emissions and become more environment-friendly. As its adoption grows and utilities seek upgradation of their grids, new opportunities are emerging in India for the distribution transformer market.
“Significant efforts across sectors are needed to tame down the carbon emissions if we want to meet the COP 21 targets. The explosive growth in the adoption of wind energy and solar PV capacities has been primarily due to continuous reduction in cost, technology advancements to improve capacity factors and progressive policy measures, and positive public sentiment,” said Deepesh Nanda, CEO, GE Gas Power, South Asia to Energy World.
Moreover, the advancement and progress is further being boosted by key initiatives from the government’s side. Numerous policies that have been rolled out by the government are likely to transform the energy industry and lead to increased demand for distribution transformer market. There are initiatives like DDUGJY and IPDS that are going to be beneficial for the sector. In addition, the influx of FDI is also putting the industry on a higher pedestal and as the renewable energy sector keeps getting stronger, the demand for transformers will further increase.