Variable Frequency Drive Market Size & Share Analysis - Trends, Drivers, Competitive Landscape, and Forecasts (2024 - 2030)

Variable Frequency Drive Market Size

Variable Frequency Drive Market Trends & Drivers

Rapid Industrialization

Rapid industrialization is also one of the key factors driving the demand for such drives. With more and more industries being set up globally, the need for variable frequency drives is increasing, as they are used in areas such as conveyors, mixers, welders, pumps, ventilation fans, grinders, cutting machines, and many more.

Almost all industries globally are dependent on some types of motors, which consume a lot of energy. Almost 300 million motors are used in the world and they account for more than 45% of the world’s electricity consumption. The use of VFDs is helping in managing motor speed, which is needed for several applications, and thus, helps industries to achieve the energy efficiency demand.

Modernization of Power Infrastructure

With the growing energy consumption, the demand for stable and energy-efficient power infrastructure is also increasing. Continuous power can only be ensured with the help of a system that is capable of handling such an amount of power generation and unexpected fluctuations. The increasing number of blackouts is due to the aging power infrastructure and lack of clear vision toward the same. Now various measures are being taken for modernizing the power infrastructure globally. With the rising need for energy efficiency and the modernization of power infrastructure, the variable frequency drive market is expected to grow at a high rate in the forecast period.

Variable Frequency Drive Market Analysis

AC Drive Category To Witness Faster Growth

In the type segment, the AC drive accounted for a revenue share of more than 69% in 2022. This can be because most of the traditional DC drives are being replaced by AC drives, due to their higher operation and maintenance costs and generation of carbon dust. They also generate poor power factors, which can be detrimental to electrical systems.

Moreover, in AC drives, the need for power system components is low, as there is no need for transformers, breakers, and HT capacitors. Also, these drives help in reducing energy consumption and improving equipment life. Thus, these factors are expected to boost the demand for AC drives in the coming years.

Low-Voltage Drives Dominate the Industry

Based on voltage, the low-voltage drive category accounted for the largest revenue share in 2022, and it is also expected to remain the largest in the forecasted period. This is because these drives provide various general and industry-specific solutions with a variety of functions. In addition, they are being used in several industrial automation applications from small to large areas in various industries, such as steel & metal, cement, oil & gas, mining, sugar, pulp & paper, water & wastewater, rubber, and plastics. Also, due to their ability to work for both low- and high-power applications, the demand for these drives is increasing.

Demand for Medium-Power Drives Will Rise at the Highest Rate

On the basis of power rating, the demand for medium-power drives (41–200 kW) is expected to witness the fastest growth during the forecast period. This can be ascribed to the surging usage of these drives in medium-voltage electrical equipment, such as HVAC systems, exhaust fans, and conveyor belts. For example, in chiller systems, chilled water pumps may not be needed to operate at a single speed, which may differ during different seasons. This will help in significant savings due to less use of electricity. Installing VFDs to assist pumps allows operators to run chilled water pumps at lower optimum speeds to maximize system efficiency and save energy.

In addition, the low-power drive (6–40 KW) category is expected to grow at a significant rate in the coming years, owing to the amount of saving they can provide at a low capital cost and better process control. Also, due to their increasing applications in different industries, such as automation, food & beverage, and construction, the demand for these drives is increasing.

Oil & Gas Holds the Largest Share

Based on end user, the oil & gas category accounted for the largest revenue share in 2022. This is due to the usage of a large number of pumps and motors at production sites in this industry. Various motors and pumps, which are used in extraction, pumping, and distribution processes, use variable frequency drives to decrease energy consumption. The main advantages of such devices include the cost-effectiveness and smoothness of the regulation of pumping modes. It will help decrease pressure waves in pipelines in the transition from one process mode to another and reduce the number of unstable process modes.

During 2022–2030, the industrial category is expected to grow at a high rate, due to rapid industrialization and the increasing trend of using energy-efficient equipment in the industry. In this sector, VFDs are used in conveyors, welders, grinders, mixers, washers, and many more. Also, with the increasing use of the industrial internet of things (IIoT) in VFDs, technicians can monitor equipment conditions from anywhere and enabling them to correct anomalies in a timely manner. It also enables predictive maintenance and real-time monitoring of the equipment.

Regional Analysis

Asia-Pacific Is the Market Leader

APAC is the largest market for VFDs, accounting for a revenue share of 35% in 2022. The regional industry is also expected to witness the fastest growth in the coming years. This is ascribed to the rapid industrialization in the region, driven by countries like China, India, Japan, and Australia; various government initiatives to reduce energy consumption through energy-efficiency norms; and the rising investments in this field, which can lead to the advancement in technology to focus on high reliability and reduced energy costs.

According to Asian Development Bank, improving energy efficiency is a highly cost-effective alternative to increasing energy availability and this can be done by fitting the energy-efficient industrial equipment, which costs about half that of adding the equivalent coal-fired power-generating capacity.

Moreover, the demand for VFDs is also increasing in North America, due to the presence of strict regulations for energy efficiency, the upgradation of aging infrastructure to secure electrical distribution systems, and rapid industrialization in the region.

Market Breakdown

This fully customizable report gives a detailed analysis of the variable frequency drive industry from 2019 to 2030, based on all the relevant segments and geographies.

Based on Type

• AC
• DC
• Servo

Based on Application

• Pumps
• Fans
• Compressors
• Conveyors

Based on Voltage

• Low Voltage
• Medium Voltage

Based on Power Rating

• Micro Power Drive (0-5 KW)
• Low Power Drive (6-40 KW)
• Medium Power Drive (41-200 KW)
• High Power Drive (>200 KW)

Based on End User

• Oil & Gas
• Industrial
• Power
• Infrastructure

Geographical Analysis

• North America
  • U.S.
  • Canada
• Europe
  • Germany
  • U.K.
  • France
  • Italy
  • Spain
• Asia-Pacific
  • Japan
  • China
  • India
  • South Korea
  • Australia
• Latin America
  • Brazil
  • Mexico
• Middle East and Africa
  • Saudi Arabia
  • South Africa

Top Variable Frequency Drive Manufacturers