A transformer is an electrical machine that is designed for transferring electricity from one specific circuit to another with different voltage levels. There are different forms of transformers that are bifurcated based on a couple of factors such as installation location, winding arrangement, the medium utilized in the core, and the working voltage range.
The transformer market revenue is projected to cross USD 80.1 Billion by 2027, transformer industry is anticipated to grow on account of rising infrastructural spending followed by upgradation of existing grid network. Favourable regulatory policies for rural electrification coupled with large scale suburban migration will propel the business growth. Ongoing Refurbishment demand for existing grid infrastructure along with large-scale renewable integration will augment the industry landscape.
Shell core transformer segment is anticipated to grow on account of integration of wide-ranging frequency distribution infrastructure and consistent grid support mechanism. The use of transformers in various industrial applications, surge in adoption of different ratings of transformers in different regions globally, rise in R&D activities and rise in industrialization are driving the growth of the market. Public & private players are investing extensively toward deployment of renewable power sources followed by favourable government incentives and schemes toward installation of solar power transformers will propel the business potential. The world economy is hit by COVID-19 pandemic where, even after re-starting the operations, many regions are facing challenges of restarting their manufacturing capacity and companies are undergoing the effect of shortages in their supply networks. However, increasing electricity demand across the healthcare sector is anticipated to enhance the product installation.
Transformer market size in India from 2015 to 2022
(in billion U.S. dollars)
Transformer Market- By Phase
By Phase, Transformer Market is segmented into single phase transformer and 3-phase transformer. Three phase transformers are witnessing significant growth in the market owing to wide applications such as supplying large loads, power transmission of the electrical grids in the power generation and rising implementation in the transmission and distribution sector. As compared to the single phase transformers the three phase transformers are more economical for supplying large loads and large power distribution. The three phase transformers are increasingly used owing to their various advantages like they are smaller and lighter to construct, they have better operating characteristics. The power generated at various generating stations is in three phase nature with voltages ranging from 13.2KV or 22KV which are then used in various end use industries for several applications. Features like high efficiency, space reduction, light weighted and smaller, low cost compared to three units of single phase transformers among others are fueling the growth of the three phase transformer market.
Global Transformer Market Segmentation
Industrial Outlook brings a short analysis of the global transformer industry based on cooling type, power rating type, types, insulation type and end user type.
By cooling type: the global transformer market is segmented into air-cooled transformer, and oil-cooled transformer. Of these, the oil-cooled transformer segment will lead the market over the forecast period. It will grow at a 7.68% CAGR by 2026.
By power rating: the global transformer market is segmented into large power, medium power, and small power. Of these, the small power segment will dominate the market over the forecast period. It will grow at a 7.57% CAGR by 2026.
By type: the global transformer market is segmented into power transformer, distribution transformer, and others. Of these, the power transformer segment will spearhead the market over the forecast period. It will grow at an 8.55% CAGR by 2026.
By insulation: the global transformer market is segmented into liquid immersed and dry type. Of these, the liquid immersed segment will have the lions share in the market over the forecast period. It will grow at a 7.61% CAGR by 2026.
By end user: the global transformer market is segmented into industrial, commercial, residential, and utility. Of these, the utility segment will command the largest share in the market over the forecast period. It will grow at a 7.79% CAGR by 2026.
Transformer Oil Market Trends
Transformer oil acts as a cooling and insulating medium in transformers. This insulating oil not only fills up the pores in the fibrous insulation such as paper, but also the gaps between the turns of the winding and the spacing between the winding and the tank. The oil, in addition to functioning as a dielectric, also serves as a cooling medium and also preserves the metal parts internally by submerging them. There are so many oils used in the transformers right from Mineral oil to vegetable oil. The main purpose of using oil in a transformer is to provide electrical insulation between the various live parts and it also acts as a protective coating layer to prevent oxidation of the metal surfaces. Another important function of the oil is to enhance heat dissipation. Transformer cores and windings get heated up during operation due to various power losses. Oil takes heat away from the core and windings by the process of conduction and carries heat to the surrounding tank, which is then radiated out to the atmosphere. Transformers generate a lot of heat and the heat has to be removed or the copper will melt and lead to failure of the transformer as a whole. Since the beginning mineral oil has dominated the industry but there are certain disadvantages of using it. Anyone who has been involved in a transformer oil spill or leak knows the headache as well as the expense of cleanup. Today, most transformers use insulating and cooling fluids derived from petroleum
crude oil. Industries have little choice but to develop extensive contingency plans and detailed procedures that require training personnel and purchasing special
equipment to handle accidental spills and leaks of transformer fluid. Several recently introduced environmentally friendly fluids could be substituted in transformers thereby reducing or eliminating these elaborate procedures. Transformer oil helps in:
– Providing an arc quenching medium .
-It acts like an insulation between the windings for which copper losses due to heating reduces.
-It reduces the humming noise created in the transformer resulting in low vibration.
The mineral oil segment is expected to be the fastest-growing segment
The mineral oil segment is estimated to be the fastest-growing during the forecast period 2021-2025
Mineral oil is subdivided into naphthenic oil and paraffinic oil, and a majority of the existing and new transformers manufactured uses mineral oil as the cooling fluid. Mineral oil has low biodegradability and low fire safety potential, which has necessitated the need for other insulating liquids to be used in transformers, reactors, and switchgears installed at high-fire risk areas, such as chemical factories. Mineral oils consist of hydrocarbon components, which usually comes from residual oil fractions of the appropriate viscosity level. In other words, mineral oil is a by-product of petroleum distillation. Naphthenic oil, a subdivision of mineral oil, is more stable in oxidation at different temperatures. In addition, these oils form soluble sludge during the course of operation, which does not affect the transformer’s operational efficiency. Thus, easy availability and the low price of mineral oil compared to other transformer oils are expected to drive the market during the forecast period of 2025.
The growth of this market can be attributed to the growing demand for power in developing countries, such as China and India, and established economies, such as Japan and China. Growing power requirements, along with the upgradation of the aging electrical infrastructure, are expected to result in an increase in the number of substations. This will propel the demand for transformers, reactors, and switchgears, which will boost the demand for transformer oil. Other important factors stimulating transformer oil market share include electrification of rural areas, expansion of power grids and increasing investment in the power sector. However, factors such as volatility in crude oil prices and increasing adoption of dry transformers are expected to hamper the market growth.
Recent Developments by Transformer Oil Market Players
- In February 2020: Nynas AB extended the product reach of NYTRO BIO 300X transformer oil in the Middle East, which is the world’s first high-performance bio-based transformer hydrocarbon fluid made from renewable sources. NYTRO BIO 300X is a solution to the challenge of keeping transformers cool in the hot climate of the Middle East.
- In January 2020: Nynas AB increased the capacity at its depot in Perth Amboy, US, to enhance its services. Previously, only process and base oils were kept in stock at the New Jersey depot, but now, NYTRO 11GBX transformer oil has been added to bring value to the customers by ensuring smooth and cost-efficient deliveries.
- In January 2020: Ergon International expanded its naphthenic refinery in Vicksburg, Mississippi, which will help the company position itself, ensuring its longevity of systems and operations.
- In October 2019: Nynas AB launched NYTRO BIO 300X, a 100% renewable transformer oil. NYTRO BIO 300X reduces a transformer’s winding hot spot temperature and combines biodegradability with superior oxidation stability.