Solid-State Transformer Market

Market Overview

The global solid-state transformer market size was valued at USD 156 million in 2021. It is expected to reach USD 663 million by 2030, growing at a CAGR of 17.4% during the forecast period (2022–2030). 

Solid-state transformers (SST) consist of high-power semiconductors, control circuits, and high-frequency transformers. It is also known as an intelligent universal transformer or a smart transformer. Smart transformers allow greater flexibility in controlling power distribution networks, allowing seamless AC-DC and DC-AC conversions as needed. It currently serves various applications, including alternative energy generation, traction trains, the power grid, and the electric industry.

Solid-state transformers handle voltage fluctuations independently when connected to the power grid. Voltage data can be communicated to the smart grid, and remote administration can be used to conduct corrective actions. A well-designed power supply is critical for operations such as alternative energy generation, such as wind turbines and solar panels.

Market Dynamics

Drivers: Increase in Global Electricity Usage

Increasing per capita income has resulted in an extraordinary rise in electricity usage in several countries. Additionally, the global transformer industry has grown due to the rapid industrialization of many Asian and European countries. As a result, the demand for energy rises, and more investments in the power industry are projected. This global semiconductor transformer market trend could capitalize on the increasing market demand throughout the projection period.

Drivers: Renewable Energy Integration

Renewable energy sources, especially solar power plants and wind turbines, could meet the predicted demand for electricity. Renewable energy sources are increasingly popular worldwide to reduce greenhouse gas emissions and use non-renewable energy sources. Asia and Africa have enormous potential to increase their share of renewable electricity generation.

Power plants relying on solar or wind turbines will necessitate new distribution transformers that are reliable and safe to use, paving the way for solid-state transformers. Solid-state transformers connect these power sources to power grids, improving power transmission efficiency. In addition, the government, research institutes, and other organizations have emphasized using renewable energy sources to generate electricity. As a result, the worldwide solid-state transformer market is likely to be driven by the increase in energy demand and the addition of new renewable power plants worldwide.

Drivers: Growing Electric Vehicle (EV) Demand

The demand for charging infrastructure, including various transformers and substations, is expected to increase significantly as the global electric car market expands. Governments across the world are supporting this quest for e-mobility. The governments of China and the United States have provided financial incentives to purchase new electric vehicles. The government has significant influence in implementing crucial regulations in the automotive industry, such as fuel emission standards, which drive electric vehicle sales.

Consequently, the global market for electric vehicles is forming, and the existing infrastructure must be updated with more advanced technologies to meet the growing number of electric vehicles. This aspect drives the need for solid-state transformers in the electric vehicle industry. Additionally, several research institutes are currently studying the adoption of solid-state transformers for electric vehicle fast-charging stations. Solid-state transformers can be used to develop an efficient and reliable 800 V DC charging infrastructure for electric vehicles.

Drivers: Rising Smart Grids Market

A smart grid is an upgraded electrical grid made up of numerous automation and information technology systems that monitor and control power transit between two places of consumption in real-time. Solid-state transformers are a crucial part of smart grids as they operate autonomously, adjust voltage, and maintain an interface with the smart grid, allowing remote management and feedback.

Solid-state transformers in smart grids reduce energy use over time by providing real-time monitoring and feedback, lowering greenhouse gas emissions. Another element contributing to the solid-state transformer market growth is the power protection it offers in the smart grid. Solid-state transformers are increasingly being used in smart grids because of these considerations. Furthermore, as power networks become more modernized, demand for smart grids is increasing globally.

Restraint: High Implementation Cost and Less Product Awareness

With the usage of high-powered power electronic components and streamlined technology, solid-state transformers are now more expensive than other types of conventional transformers. Solid-state transformers have a high implementation cost, limiting the market expansion. Furthermore, solid-state transformers adoption is likely to lower significantly in undeveloped and underdeveloped nations. Solid-state transformers are seen as a critical enabler for the development of upcoming electric power systems. As a result, the price will likely fall in the future, owing to proactive government activities and increased product knowledge. Market growth is expected to be further hampered by the lack of understanding of the application of semiconductor transformers in various applications.

Opportunities: Growth in New Power Electronics

The solid-state transformer technology is nascent compared to traditional transformer technology; periodic enhancements in many design aspects will improve solid-state transformers' functionality and lifespan cycle. Since they are made up of various high-powered power electronic components, any advancement in these areas will benefit the solid-state transformer market throughout the projected period.

Various research institutes worldwide are actively engaged in solid-state technology research and development. For example, a group of academics from the Georgia Institute of Technology published a study on Soft-Switching Solid-State Transformers in 2018. The researchers investigated a new configuration for an entirely bidirectional soft-switching solid-state transformer (SST) with 12 primary devices and a high-frequency transformer that did not require an intermediary DC voltage link.

For high-voltage and high-power applications, the redesigned construction permits series and parallel stacking of converter cells. It can also achieve higher power density and longer life by reducing components like electrolytic capacitors. A solid-state transformer centered on an adaptive proportional-integral–fuzzy logic controller (API-FLC) was also developed, according to another paper published in 2018.

In simple terms, the FLC was utilized to improve the solid-state transformer centered on an adaptive proportional-integral–fuzzy logic controller (API-FLC). According to another paper published in 2018, performance and power quality. As a result, proactive research studies are required and are currently being undertaken worldwide to accelerate the product development process. These reasons are expected to provide profitable prospects for the worldwide solid-state transformer market during the projected period.

Segmental Analysis

The global solid-state transformer market share is segmented by type and application.

Based on type, the global solid-state transformer market is classified into Power, Distribution, and Traction Solid-State Transformers.

Power Solid-State Transformer is the major shareholder in the global solid-state transformer market and is projected to grow at a CAGR of 17.1% during the forecast period. The worrying rate of greenhouse gas emissions and the increased use of non-renewable energy sources, including uranium, coal, oil, and other fossil fuels, are projected to push the adoption of solid-state transformers in power grids. The demand for power transformers is also increasing because of increased industrialization and modernization, boosting the global solid-state transformers market.

Traction Solid-State Transformers reduce vessel weight and volume compared to typical transformers. Commercial adoptions will power solid-state transformers. Traction solid-state transformers are the most used solid-state transformers because they are small and lightweight.

Based on application, the solid-state transformer market is segmented into Renewable Power Generation, Power Distribution, Traction Locomotives, and Electric Vehicle Charging Stations.

Renewable Power Generation is the highest market shareholder for solid-state transformers and is expected to grow at a CAGR of 17.2% during the forecast period. The need for solid-state transformers is expected to be driven by the growing demand for and appeal of alternative power production systems and the expansion of renewable energy markets worldwide. Solid-state distribution transformers are more reliable and efficient than line-frequency transformers, which is predicted to increase the need for solid-state transformers in power distribution applications.

Regional Analysis

The global solid-state transformer market share is classified into four regions, namely Asia-Pacific, Europe, North America, and LAMEA.

Asia-Pacific Constitutes the Largest Revenue in the Global Solid-State Transformer Market

Asia-Pacific is the most significant contributor to the solid-state transformer market and is anticipated to grow at a CAGR of 19.1% during the forecast period. The many infrastructure initiatives promoted by developing countries to increase essential demand for commercial trade provide significant space for expanding the semiconductor transformer market in this region. China is the most critical contributor to the market compared to other countries. Japan and India are growing their market gradually.

Europe is expected to grow at a CAGR of 15.8%, generating USD 214 million during the forecast period. The demand for power distribution systems is expected to increase as various international companies' investments increase. Germany and France have more market revenue compared to the UK and Italy.

The solid-state transformers market in North America is expected to witness steady growth. The demand for solid-state transformers in North America is likely to be driven by a surge in the uptake of renewable energy generation and new metro projects and the development and deployment of smart grids in many countries. The US has the central market in this region.

LAMEA has the lowest market, with Brazil being its primary contributor. The need for solid-state transformers is now driven by economic expansion supported by the manufacturing and construction industries, population growth and a corresponding spike in electrification projects, and emerging industrial developments in these regions.

Recent Developments

• June 2022- Alstom, the global leader in smart and sustainable mobility, has signed an agreement with GTS Rail, a Bari-based company that operates in intermodal rail freight transport, for the supply of 20 Traxx DC3 electric locomotives, named E.494 in Italy. 
• June 202 - GE (NYSE: GE) and Continuum Green Energy (India) Pvt Ltd or “Continuum,” a company majority-owned by a global infrastructure fund managed by Morgan Stanley Infrastructure Inc, announced the financial close of GE Energy Financial Services (“GE EFS”) acquisition of a 49% stake in Continuum’s 148.5 megawatts (MW) Morjar onshore wind project (“Morjar”) in Gujarat, India.
• May 2022- Power management company Eaton recently announced the launch of the first Supply Chain digital incubation lab in Pune, India.
• November 2021- Schneider Electric, the leader in the digital transformation of energy management and automation, launched its sustainability engagement initiative in India, Green Yodha, to encourage and support businesses, industries, and individuals to come together and take concrete climate action. This urgent call to a movement intends to back the increased commitment the Indian government made at COP26.

Solid-State Transformer Market Segmentation

By Type

• Power Solid-State Transformer
• Distribution Solid-State Transformer
• Traction Solid-State Transformer

By Application

• Renewable Power Generation
• Electric Vehicle Charging Station
• Power Distribution
• Traction Locomotive

By Regions

• Asia-Pacific
• Europe
• North America
• LAMEA