According to our latest market study on "North America Transformer Services Market Forecast to 2028 - COVID-19 Impact and Regional Analysis - by Service Type (Installation & Relocation, Testing & Monitoring, and Repair & Maintenance) and Application (Power Transformer, Distribution Transformer, and Renewable Transformer)," the market is projected to reach US$ 593.7 million by 2028 from US$ 433.9 million in 2022; it is expected to register a CAGR of 5.4% from 2022 to 2028.
The service companies provide transformer services throughout the complete transformer lifecycle, from commissioning to recycling, for all brands and types of transformers. The companies operating in the transformer services market provide various services such as preventive maintenance, repair services, emergency services, modernization and retrofit, refurbishment, upgrade, and lifecycle extension. Transformer services allow utilities and industries to maximize the return on transformer assets by ensuring high reliability, reducing life cycle costs, and ensuring optimized performance, while lowering environmental impact. Transformer services eliminate unplanned downtime through routine inspection and maintenance, avoid substantial financial and reputation loss associated with service disruptions, minimize emergency repairs, and ensure the ongoing reliability of electrical distribution systems. Thus, such featured services augment the market size, which helps propel the North America transformer services market growth.
Increasing demand for power supply, growing focus on renewable energy sources, aging transformer components, and supportive government regulations are the key factors influencing the demand for transformer services. The growing initiatives from governments of North American countries for strengthening the grid, owing to aging transmission and distribution components, are also anticipated to boost the North America transformer services market growth. For instance, in January 2022, the Department of Energy unveiled its grid initiative to upgrade and expand the Nation's Electric Transmission Grid. Most US transmission lines and substations were constructed more than 40 years ago and are based on 1950s technology. However, the load on the electric power system has increased significantly over the years. Thus, the power components such as transformers and other components need frequent services in terms of maintenance and new installation.
Currently, the power demand is increasing at a significant rate, which needs suitable infrastructure for transmission. This requirement cannot be supported by the older components, necessitating the replacement of transformers. The government's support for replacing the old transformers is also accelerating the market growth. In April 2022, as per the Department of Energy, the Biden administration is unveiling two new programs, established by the Bipartisan Infrastructure Law, which will provide US$ 20 million worth of rebates to replace old transformers. Transformers with more than 10-12 years need more services compared to transformers installed later. Thus, such factors are strengthening the demand for North America transformer services market over the coming years.
The North America transformer services market is segmented into service type and application. Based on service type, the market is segmented into installation and relocation, testing and monitoring, and repair and maintenance segment. The repair and maintenance segment is expected to hold a large portion of the market share, owing to the increase in the need for maintenance and repair activities in order to make sure its internal and external parts are in good condition and to maintain a record of their condition. Based on application segment, the market is segmented into power transformers, distributor transformers, and renewable transformers. The power transformers segment is expected to hold the largest market share, owing to increasing energy demand and growing initiatives for adding renewable energy production which is further driving the North America transformer services market.
The key market players or service providers in the North America transformer services market analysis include GE; Vertiv Group Corp.; Hitachi Energy Ltd.; Stark International Ltd.; RESA Power LLC; Houghton International; Siemens Energy; VCM Solutions; Power Substation Services; Magneto Electric North American Substation Services Ltd. (NASS); SPX Corporation; Transformer Services, Inc.; Kinectrics; Transformer Engineering Service; EMERALD; SDMyers; ELSCO TRANSFORMERS; American Superconductor; Tru-Amp Corporation; Controlled Magnetics, Inc.; CES Transformers; Aevitas Lineman's Testing Laboratories Of Canada Limited; van Kooy Transformer Consulting Services Inc; EthosEnergy; Sunbelt Solomon; Maschinenfabrik Reinhausen GmbH; TCI of NY (G&S Family of Companies); Pace Technologies Inc.; Scherer Electric; and Eaton. The North America transformer services market report provides detailed market insights which helps the key players to strategize the growth in coming years.
Impact of COVID-19 Pandemic on North America Transformer Services Market
North America has the highest acceptance and development rate of emerging technologies for transformer services due to favorable government policies to boost innovation and reinforce infrastructure capabilities. The power industry has a significant contribution on the country's economy during to the COVID-19 pandemic. The US is one of the world's worst-affected countries due to the COVID-19 pandemic, as the pandemic led to a severe cascading impact on multiple industries, including IT, automotive, manufacturing, and telecommunication. The operations in these industries were temporarily discontinued, which hampered the power demand in the first half of 2020. In March 2020, the US government released the third relief and stimulus spending package for renewable energy and other subsets of the power industry in response to this unprecedented national emergency. However, since 2021, the renewable industry has been improving at a faster pace with a significant rise in demand for energy, which has accelerated the need for services for transformers. The increasing investment in grid projects from governments of North American countries and supportive initiatives for strengthening the electric power grid in the post-pandemic period are augmenting the North America transformer services market growth. The supply chain and a tight labor market were the prominent factors limiting transformers' supply and production activities in 2020. As a result, the temporary delays in providing services for transformers hampered the North America transformer services market in the initial phase of the pandemic.
The report segments the North America transformer services market size as follows:
Based on service type, the North America transformer services market analysis is segmented into installation and relocation, testing and monitoring, and repair and maintenance. In terms of application, the market is segmented into power transformers, distributor transformers, and renewable transformers. Based on country, the North America transformer services market is segmented into the US, Canada, and Mexico.
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