Flexible AC Transmission Systems Market Size & Share Analysis - Trends, Drivers, Competitive Landscape, and Forecasts (2024 - 2030)
Get a Comprehensive Overview of the Flexible AC Transmission Systems Market Report Prepared by P&S Intelligence, Segmented by Application (Voltage Control, Power Control), Compensation Type (Series, Shunt, Combined), End User (Utilities, Industrial), and Geographic Regions. This Report Provides Insights From 2017 to 2030.
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Global Flexible AC Transmission Systems Market Analysis
The global flexible AC transmission systems (FACTS) market generated USD 1,503.4 million revenue in 2023, and it is projected to witness a CAGR of 7.0% during 2024–2030, reaching USD 2,389.3 million by 2030. This is due to the increasing demand for electricity, increasing focus on grid stability and smart grid development, and policy support and several government initiatives to promote the deployment of FACTS to enhance grid efficiency and reliability.
AC grid stability, reliability, and transmission efficiency are provided by FACTS. A comprehensive approach is provided by these modified solutions to inhibit large voltage fluctuations, minimize power failures, optimize network assets, and address load-induced disturbances.
Flexible AC Transmission Systems Market Trends & Drivers
Agreements between Market Players and Electric Utilities Is Key Trend
There are various benefits of signing agreements with each other for both electric utilities and market players. The increasing number of such initiatives highlights the joint efforts between technology providers and utility companies to magnify the incorporation of renewable energy sources, improve overall grid efficiency, and increase the stability of the grid.
For example, Taiwan Power Company in May 2023 gave an order to Mitsubishi Electric Corporation, through its Taipei-based affiliate Shihlin Electric & Engineering Corporation, for a STATCOM aimed at stabilizing the power grid.
Moreover, in September 2022, GE entered into a framework agreement to deliver STATCOMs to 50Hertz, one of Germany’s four TSOs. This agreement, including the delivery of the first two hybrid STATCOMs, showcases the strategic implementation of FACTS to increase grid stability in response to the growing renewable energy penetration.
Such contracts between FACTS technology providers and electric utilities highlight the joint efforts to address the challenges of modernizing power grids, integrating renewable energy, and ensuring the reliability and efficiency of electrical infrastructure globally are shown by these trends.
This trend is important for the development of the energy sector and supporting the shift toward more-sustainable and resilient power systems.
Increasing Focus on Grid Stability and Smart Grid Development Drives Market
Smart grid technologies incorporate renewable and distributed energy resources to modernize the electric grid, thereby reducing greenhouse emissions and lowering operating costs.
NYSERDA provided funding for smart grid opportunities for R&D, for the integration of distributed energy resources, future grids, and high-performing grids.
Additionally, USD 4.5 billion has been invested by the American Recovery and Reinvestment Act in the electric industry.
Smart grids and advanced technology in transmission systems with FACTS are needed for more efficient electricity transmission and distribution.
The European Commission unveiled the Digitalisation of the Energy System plan at the end of 2022 with an expected investment of approximately USD 633 billion (EUR 584 billion) in the European electricity grid by 2030.
In 2022, Japan introduced a funding program with USD 155 billion to boost investments in smart power grids.
China has made strategies to modernize and expand its power grids through the investment of USD 442 billion, spanning the 2021–2025 period.
India launched a scheme in 2022 to allocate approximately USD 38 billion (INR 3.03 trillion) to support power distribution organizations and boost distribution infrastructure.
Complexity of Integration into Existing Grid Is Key Challenge
It is a difficult task to integrate FACTS devices into the existing power grid, as it involves alterations to grid operations, systems analysis, and extensive planning. This complexity creates interruptions in project timelines and increases costs.
For instance, a detailed study is required to integrate a series of compensation systems, to ensure system stability and avoid resonances with the existing network.
Utilities usually prefer traditional solutions and may not adopt technologies with which their workforce is not familiar.
Moreover, FACTS technologies have several benefits, but they can also have technical challenges, such as in the supervision of power electronic switching devices and the requirement for complex control strategies.
Due to the concern about the reliability and robustness of these systems, market growth can be limited in harsh environmental conditions. For example, in areas that have extreme temperatures or high levels of pollution, the functioning of FACTS devices may need extra protective measures and, simultaneously, increase costs.
Voltage control is the larger application, with a market share, of 75% in 2023, and it is also the faster-growing category. This is due to the utilization of FACTS for controlling voltage, which helps in directing the instant needs of power quality and transmission efficiency, as well as setting the groundwork for future grid innovations, thus supporting the shift toward smarter, more-flexible power systems. Hence, governing support, technological requirements, and efforts for cleaner energy sources are contributing to the growth of the market in this bifurcation.
During the study, these applications were considered:
Voltage Control (Larger and Faster-Growing Category)
Power Control
Compensation Type Insights
The shunt category is the largest, with a market share of over 60% in 2023. Reduced power losses and a lower incidence of voltage drops are the biggest advantages of using shunt compensation in power transmission & distribution networks. This is why it has a broad range of applications, such as voltage regulation, transmission loss elimination, system voltage balance maintenance, high transient stabilization, transmission capacity augmentation, dynamic reactive power control, and voltage stabilization.
This segment has three categories:
Series
Thyristor-controlled series capacitor (TCSC) (Fastest-Growing Category)
Thyristor-controlled series reactor (TCSR) (Largest Category)
Thyristor-switched series capacitor (TSSC)
Static synchronous series compensator (SSSC)
Shunt (Largest and Fastest-Growing Category)
Static synchronous compensator (STATCOM) (Largest and Fastest-Growing Category)
Static VAR compensator (SVC)
Thyristor-switched reactor (TSR) (Largest and Fastest-Growing Category)
Thyristor-switched capacitor (TSC)
Thyristor-controlled reactor (TCR)
Combined
Unified power flow compensator UPFC (series–shunt) (Larger and Faster-Growing Category)
Interline power flow compensator IPFC (series–series)
End User Insights
Utilities are the largest end users, with a market share of around 55% in 2023, and they are also the fastest-growing category. The applications of FACTS in electric utilities include voltage control, network stabilization, transmission capacity enhancement, power oscillation damping, and power flow control. FACTS devices also provide an economical and efficient solution to ease the pressure on existing transmission lines and save on the investment cost required for building new network extensions. Companies such as GE and Siemens provide FACTS to electric utilities because of the high demand for electricity around the world.
The following end users were studied for the report:
Utilities (Largest and Fastest-Growing Category)
Industrial
Others
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APAC Is Largest and Fastest-Growing Region
APAC is the largest region, with a market share of over 50% in 2023, and it is the fastest-growing region too. Rapid technological advancements characterize the regional energy sector, which are reflected in the modernization of the power transmission infrastructure. This region is also fully focused on EVs and the integration of renewable energy.
The expansion in the use of renewable energy sources and the push toward electrification in China, Australia, and India necessitate advanced energy management and transmission solutions to ensure grid stability and efficiency. Hence, the convergence of digital transformation and sustainable energy initiatives positions APAC for sustained growth in the FACTS market. This is because these changes address both the immediate and long-term requirements for advanced power transmission and grid stabilization solutions, in response to the evolving energy landscape.
Moreover, the North American market is driven by the improving electricity transmission infrastructure, higher focus on better power T&D system control, and need for the grid to be reliable during a disaster or other emergency. This requires the U.S. and Canada to substantially upgrade their grids with better T&D equipment.
In addition, market players will have numerous opportunities as the integration of renewable sources of energy rises and smart grids emerge in the continent. This is because wind and solar energy systems require advanced systems for grid management, where FACTS helps by regulating the flow of power and maintaining overall infrastructure stability. In this regard, the investment of the federal government in clean energy technologies is a key driver for the progress of the market in North America. The government is also offering policy support to decarbonize its grid.
For instance, under the Investment Tax Credit (ITC) and Production Tax Credit (PTC) schemes, incentives are offered to entities keen on establishing wind and solar parks across the nation. These intermittent energy sources need FACTS to stabilize power and voltage, thereby preventing the breakdown of the T&D system. Further, the Smart Grid Investment Grant (SGIG), which aims at establishing smart and more-responsive grids, drives the adoption of intelligent and efficient flexible AC transmission system components.
Similarly, the market in Europe, which is on the path to reaching USD 280.7 million by 2030, is propelled by the rising demand for controlling power flow in the grid and the upgradation of the T&D infrastructure in the developed countries in the region. Essentially, the key reason behind the rising FACTS integration rate is the increasing demand for power transmission efficiency, better control on the grid, and reduction of energy losses during transmission. By making electricity transmission more efficient, FACTS prevents a complete blackout and also enables renewable sources to be integrated into the energy mix.
Therefore, another key driver for the market is regional countries’ grid modernization and decarbonization efforts. For this, the EU hopes to invest USD 184 billion by 2030 in automated grid management systems, smart meters, field operation improvement, and other digital metering technologies. Encouraged by such efforts, Siemens Energy is providing FACTS in the continent for making the existing grid more efficient and stable. It offers STATCOMs and SVCs to enable fault recovery, reactive power capabilities, blackout risk reduction, power factor regulation, and higher overall T&D reliability. All this is crucial in the drive toward renewable energy and grid stability.
These regions and countries were analyzed for this report:
North America
U.S. (Larger and Faster-Growing Country Market)
Canada
Europe
Germany (Largest and Fastest-Growing Country Market)
U.K.
France
Italy
Spain
Rest of Europe
APAC (Largest and Fastest-Growing Regional Market)
China (Largest and Fastest-Growing Country Market)
Japan
India
South Korea
Australia
Rest of APAC
Latin America (LATAM)
Brazil (Largest and Fastest-Growing Country Market)
Mexico
Rest of LATAM
Middle East and Africa (MEA)
Saudi Arabia (Largest and Fastest-Growing Country Market)
South Africa
U.A.E
Rest of MEA
Flexible AC Transmission System Market Share
The global flexible AC transmission systems (FACTS) market is consolidated in nature, and major companies are investing in research and development to launch new and better products. Other approaches of companies are mergers, acquisitions, collaborations, and partnerships, which have become necessary to survive in the market.
Top Flexible AC Transmission Systems Companies:
Hitachi Ltd.
Mitsubishi Electric Corporation
GE Grid Solutions
Bharat Heavy Electricals Ltd.
INGETEAM S.A.
Nidec ASI S.p.A.
American Superconductor Corporation
JEMA Energy S.A.
NR Electric Co. Ltd.
Toshiba Corporation
Merus Power
Flexible AC Transmission Systems Market News
In December 2023, NR Electric Co. Ltd. installed two sets of 100-MVAr STATCOMs at the 500-kV Zongjiang Substation in Dongguan, Guangdong. The STATCOMs were successfully put into operation after a comprehensible commissioning and rigorous testing process, which included 1.5-times overload operation, low-voltage ride-throughs, and redundancy tests.
In July 2023, Hitachi Energy signed an agreement with KiwiRail to supply two 20-MVA SFCs, which will improve power quality and increase stability, to support more train services than before, beginning in 2025.
In June 2023, NR Electric Co. Ltd. announced that a 2 × 150-MVAr STATCOM at the Guangdong Shenzhen 500-kV Pengcheng substation and a 2 × 150-MVAr STATCOM at the ± 800-kV Dongfang Converter Station, which were supplied by NR, were officially put into operation.
In May 2023, Mitsubishi Electric Corporation announced that its Taipei-based affiliate, Shihlin Electric & Engineering Corporation, had received an order from Taiwan Power Company for a STATCOM for power grid stabilization.
In April 2023, GE Renewable Energy’s grid solutions business announced that it had won five FACTS contracts in recent months. The contracts include an FSC for a bank reconfiguration project for the Public Service Company of New Mexico (PNM) in the U.S. and a STATCOM project for Saudi Electricity Company.
Frequently Asked Questions About This Report
What will be the flexible AC transmission systems market future size?+
The flexible AC transmission systems value will reach 2,389.3 million in 2030.
What is the size of the market for flexible AC transmission systems?+
The market for flexible AC transmission systems will touch USD 1,591.0 million in 2024.
What are the biggest trends in the flexible AC transmission systems industry?+
Agreements between industry players and electric utilities are the key flexible AC transmission systems industry trend.
What is the end user analysis of the flexible AC transmission systems industry?+
Utilities hold the larger flexible AC transmission systems market share.
Which is the largest regional flexible AC transmission systems industry?+
The APAC market for flexible AC transmission systems is the largest.
What is the flexible AC transmission systems market competitive landscape?+
The flexible AC transmission systems market is consolidated, and key players are funding in R&D to develop novel and improved products.
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