Dry Type Transformer Market Size, Share & Trends Analysis Report By Type (Dry Type Converter Transformer, Dry Type Converter Rectifier Transformer), By Technology (Cast Resin, Vacuum Pressure Impregnated), By Phase (Single-Phase, Three-Phase), By Voltage (Low Voltage, Medium Voltage), By End Use (Industrial, Commercial) and By Region(North America, Europe, APAC, Middle East and Africa, LATAM) Forecasts, 2023-2031

Market Overview

The global dry type transformer market size was valued at USD 6.30 billion in 2022. It is projected to reach USD 10.59 billion by 2031, growing at a CAGR of 5.95% during the forecast period (2023-2031). The increasing demand for electricity worldwide and the adoption of renewable energy sources stimulate market growth.

A dry type transformer is one that uses forced or natural air cooling in place of oil and is built using relatively modern technology. Dry type transformers only use high-temperature insulation systems that are safe for the environment, in contrast to liquid-fill transformers that need oil or liquid to cool. It has no moving parts, so it requires little maintenance while providing dependability and a long lifespan. These transformers can be easily installed in hospitals, schools, factories, chemical plants, and other structures where fire safety is a major concern because they are completely risk-free. Cast resin and vacuum-impregnated (VPI) dry type transformers are the two technology-based segments of the global dry type transformer market. In a vacuum pressure-impregnated (VPI) transformer, the live part is impregnated under pressure by an epoxy varnish in a vacuum chamber. In a cast resin transformer, the live part, consisting of the core and windings, is encapsulated inside a resin, which is in liquid form when put in the molds along with a hardening agent. Even after impregnation, VPI allows access to the live part while still providing excellent fire protection ratings.

Market Dynamics

What are the primary factors driving the dry type transformer market?

Increasing Demand for Electricity Worldwide

Rapid industrialization and rising domestic power demand are driving growth in the global dry type transformer market. Globally, there is a steadily growing demand for electricity, which has increased the use of energy resources. As a result, there are now more power plants and larger transmission networks around the world. The development of contemporary electric vehicles and incentives to use them are driving up electricity consumption in the automotive industry. The generated electricity is then sent through power transmission lines to the substations, where it is distributed to the end users after being stepped down due to the fact that power plants are typically located in remote areas. A dry type transformer performs the step-down function. Applications for dry-type transformers include industries, environmentally sensitive areas, forest substations, indoor and underground substations, onshore and offshore installations, and other places where there is a high risk of fire or moisture. Additionally, most nations have underutilized energy resources, while the entire power infrastructure in developing nations requires improvement. The demand for dry type transformers will further rise as electrification projects for metro railways, stadiums, and other commercial spaces are undertaken. Therefore, the growth of the global dry type transformer market is currently driven by the demand for electricity globally.

Increasing Adoption of Renewable Energy Sources

The key factors behind the production of renewable energy are supportive governmental regulations to reduce greenhouse gas emissions and initiatives for clean energy. Major non-conventional energy resources include nuclear, biomass, and geothermal, while major renewable energy sources include wind, solar, and hydroelectricity. These new plants are integrated into the current transmission networks with the aid of transformers, such as a dry-type transformers. The transformer turns the hydroelectric power plant's alternating current into a high-voltage current. The national grid receives this converted energy and distributes it to homes and businesses for use. Solar generation is expected to account for up to 48% of all U.S. renewable generation in 2050, making it the fastest-growing source of electricity globally. Renewable energy is the energy source that is expanding the quickest. However, dry-type transformers are used in power grids for other non-conventional energy sources as well, so their use is not just limited to wind and solar power plants. As a result, the global dry-type transformer market has opportunities for long-term growth as renewable energy becomes a major source of energy.

What are the main factors that will slow down the dry type transformer market?

Development of Solid-State Transformers

Solid-state transformers are a hybrid of high-frequency transformers, control circuitry, and semiconductor components. For electric traction systems, solid-state power transformers have been created to take the place of magnetic-core power transformers like dry type transformers. It is used in traction systems, distribution systems, and other systems for heating and lighting, among other things. It is more complicated than a conventional transformer that runs at a utility frequency, but because it operates at a high frequency, it can be smaller and more effective.

What are the future opportunities for the dry type transformer market?

Increasing Adoption of Smart Grids and Digital Dry Transformers

The term "smart grid" refers to an electrical network with automation, communication, and I.T. systems that can monitor power flows from points of generation to points of consumption (even down to the level of individual appliances) and control the flow of power or reduce the load in real-time or almost real-time to match generation. The implementation of effective transmission and distribution systems, system operations, consumer integration, and renewable integration lead to the creation of smart grids. In order to identify losses and take the necessary technical and managerial steps to stop them, it is helpful to monitor, measure, and control power flows in real-time. Existing grids must be converted to smart grids in order to respond to changes in user demand for electricity while lowering greenhouse gas emissions. If smart transformers that can provide real-time data offering power quality and lifecycle assessment are developed, smart grids will perform better.

Regional Analysis

The global market is bifurcated into four regions, namely North America, Europe, Asia-Pacific, and LAMEA.

Asia pacific dominates the global market

Asia Pacific region is the highest contributor to the dry type transformer market and is expected to grow at a CAGR of 5.65% during the forecast period. The construction, power, and renewable energy sectors are receiving significant investment from countries like India, China, and Japan, which are major players in the region. Construction activities for homes and businesses are boosted by rising household incomes and a shift in population from rural to urban areas. Three UHV AC transmission networks and one UHV DC power transmission network are being built in China with significant investment. The replacement of aging transformer units is likely to occur with these developments. In addition, as China continues to develop, it has opened up new economic opportunities in its cities, which has led hundreds of millions of rural Chinese to move into the cities. Transformers for trackside and traction already have a high demand due to the electrification of Indian railways and new metro construction. A demand for special transformers used in unique applications, such as furnace transformers, is also being created by the dedicated freight and cargo corridors project in addition to the demand for regular distribution transformers.

Europe is expected to witness dynamic growth in the global dry type transformer market, with a CAGR of 6.1% during the forecast period. In recent years, E.U. legislation promoting renewable energy has undergone significant change. Transformers for both power and distribution are required as we move toward renewable energy sources like solar and wind. Reliable distribution systems are required because the majority of these solar and wind farms will be situated outside of the city. The demand for dry type transformers is likely to rise as a result. The production of electricity from wind and solar P.V. has significantly increased in Italy over the last few years. Intensive work is currently being done on the national electricity grid due to the pressures that the growing amount of energy from renewable sources is putting on the power grid.

North America is expected to witness a significant CAGR of 6.5% in the global dry type transformer market during the forecast period. Dry type transformers are used in manufacturing facilities for the automotive, chemical, oil & gas, solar energy, and electronics sectors. Additionally, new metro projects and an increase in the adoption of renewable energy sources are likely to present new opportunities for power distribution systems like dry type transformers. In 2020, 90% of the U.S. could be powered by renewable energy, according to a report from the University of California. This prediction is based on variables like international efforts to use more environmentally friendly energy sources and the sharp decline in the price of alternative energy sources like wind or solar energy.

The LAMEA region is expected to witness a moderate CAGR of 5.8% in the global market during the forecast period. The demand for dry type transformers is currently being driven by economic growth in these areas, which is being fueled by the manufacturing and construction sectors, growing populations, a concomitant surge in electrification projects, and new industrial developments. Renewable energy generation adoption is accelerating in the majority of LAMEA nations. Saudi Arabia is spending a lot of money on the production of renewable energy. Saudi Aramco, which is based in Saudi Arabia, has announced plans to introduce a new USD 500 million in funds to support energy conservation and renewable technologies. The demand for railway isolation transformers and excitation transformers is also likely to rise as a result of new railway projects in the nation.

Segmental Analysis

The global market is segmented by type, technology, phase, voltage, and end-use.

Based on type, the global market is bifurcated into dry type converter transformers and dry type converter rectifier transformers.

The dry type converter transformer segment is the highest contributor to the market and is expected to grow at a CAGR of 5.8% during the forecast period. Transformer converters are used to change power from A.C. to D.C. at one end and from D.C. to A.C. at the other. As semiconductor converters in the traction substation for the city's electrified public transportation (tram, trolley bus, and subway), converter transformers are primarily used in excitation systems for turbo and hydro-generators, electric drives of drilling equipment, and D.C. & A.C. electric drives.

The dry-type converter rectifier transformer segment is expected to witness a higher CAGR of 6.2%. Transformers known as rectifier transformers (rectiformers) contain diodes or thyristors in the same tank. They are employed in industrial processes that need a sizable supply of direct current (dc). D.C. traction, electrolysis, smelting operations, and sizable variable-speed drive trains are examples of typical processes. In a D.C. electric substation for railway applications, rectifier transformers with ratings of 3150 kVA and 22 kV are used. They have a wide range of uses, including powering devices like radios, T.V.s, computers, and other electronics that require a steady D.C. supply. Dry type rectifier transformers are therefore utilized in both residential and commercial building spaces.

Based on technology, the global market is bifurcated into cast resin and vacuum pressure impregnated.

The cast resin segment is the highest contributor to the market and is expected to grow at a CAGR of 5.8% during the forecast period. The magnetic circuit and windings are cast with an epoxy resin mixture instead of being submerged in an insulating liquid in a typical cast resin dry type transformer. Copper conductor windings for high-voltage (H.V.) and low-voltage (LV) applications are completely impregnated with epoxy resin and cast under a vacuum. The winding material is shielded from moisture by this encapsulation. CRTs are suitable for indoor applications because their winding is protected from fire hazards by non-flammable epoxy resin. CRTs are also perfect for use in areas that are prone to moisture because of the insulation.

The vacuum pressure-impregnated segment is expected to witness a higher CAGR of 6.4%. The transformer windings are impregnated with polyester or epoxy resin under vacuum pressure in order to replace air bubbles, dust, and other small particles with dielectric resin. This process eliminates any potential causes of local weakening in the insulation system. Transformers are polymerized in an oven following the initial impregnation using carefully timed thermal cycles. The conductor material, insulation, and resin are all solidified together during this process, improving both the mechanical and electrical properties. As a winding insulator, fiberglass, mica, or aramid paper is used to achieve self-extinguishing properties.

Based on phase, the global market is bifurcated into single-phase and three-phase.

The single-phase segment is the highest contributor to the market and is expected to grow at a CAGR of 5.9% during the forecast period. Transformers of the single-phase dry type is suitable for applications requiring less than 1,000 watts of power. They are utilized as electronic devices and home appliances in low-voltage commercial applications. In addition to serving as a step-down voltage transformer, single-phase dry type transformers can also provide enough power to tune electric motors up to 5 horsepower (hp). A single-phase dry type transformer installed in residential and commercial spaces reduces the high voltage that is received from the power grid. To balance the total phase impedance in applications of contemporary steel processes, three single-phase furnace dry-type transformers rather than a single three-phase transformer are used in steel plants.

The three-phase segment is expected to witness a higher CAGR of 6.4%. The voltage can be changed from one side of a three-phase dry type transformer to the other. But compared to a single-phase dry type transformer, it can distribute three times as much power. Data centers, mobile towers, and power grids are some of the main applications for three-phase dry type transformers. Induction motors need three-phase power to run in an industrial setting. Compared to single-phase transformers, a three-phase dry type transformer can run at higher power loads. Because three-phase transformers can carry loads greater than 1000 watts, which are required to operate some industrial machinery, auxiliaries, and motors, they are used in more commercial applications than single-phase transformers.

Based on voltage, the global market is bifurcated into low-voltage and medium-voltage.

The low-voltage segment is the highest contributor to the market and is expected to grow at a CAGR of 6.1% during the forecast period. The voltage is typically stepped down using low-voltage dry type transformers (LVDT), which are bought from utility companies. Buildings employ LVDTs to reduce the incoming voltage so that appliances, lighting, and other consumer electronics can be powered. It is rated for voltage at less than 600 volts. They are typically produced using VPI technology, and they have a wide range of regular and unique applications in commercial buildings, ships, deep mines, and other industrial settings.

The medium-voltage segment is expected to witness a higher CAGR of 5.6%. Commercial and industrial businesses, governmental organizations, and other large facility operators are the main owners of medium-voltage dry-type distribution transformers. The transformer receives an incoming voltage in the range of 5 kV to 35 kV. For use in commercial, institutional, or industrial applications, they are primarily used to step down medium-voltage power to a lower operating voltage. Transformers with a medium voltage can also be used to step up voltage, though. The expansion of end users like the commercial and residential sectors affects the demand for medium-voltage dry type transformers. These transformers are replacing conventional oil-filled transformers in places like hospitals, schools, factories, chemical plants, and buildings where fire safety is a major concern because they are completely risk-free.

Based on end use, the global market is bifurcated into industrial, commercial, and others. 

The industrial segment is the highest contributor to the market and is expected to grow at a CAGR of 5.8% during the forecast period. The industrials segment consists of the use of dry type transformers as step-up or step-down voltages in industrial power distribution systems. The majority of industrial facilities have environments that make it unsafe for wet transformers to operate safely, which is why the demand for dry type transformers is rising. The adoption of dry-type transformers in industrial settings is influenced by features like excellent overload tolerance, eco-friendliness, non-combustibility, and excellent impulse voltage strength. Additionally, dry type transformers are built to be humidity resistant, and the lack of a cooling liquid completely eliminates the possibility of an oil spill.

The commercial segment is expected to witness a higher CAGR of 6.2%. Commercial structures, including airports, water treatment plants, hospitals, hotels, underground stores, stadiums, educational facilities, and shopping malls, are among the commercial spaces that use dry type transformers. Private and public electricity distribution companies are other industrial end-user of dry type distribution transformers. In order to lower the building distribution voltage to a level that can be used by particular equipment, dry type transformers are also installed indoors. Commercial buildings typically have step-down transformers to reduce the voltage from a higher utility distribution voltage (7 to 25 kV) to a lower utilization voltage.

Recent Developments

• August 2022, Schneider Electric released new research and innovations to better understand the initiatives within I.T. and data center organizations.
• May 2022, Bharat Heavy Electricals Ltd signed MoU with G.E. ink for the development of an integrated electric propulsion system for the Indian Navy.