The APAC synchronous condenser market is expected to grow from US$ 109.85 million in 2019 to US$ 137.88 million by 2027; it is estimated to grow at a CAGR of 3.8% from 2020 to 2027.
Mounting high-voltage direct current (HVDC) network is expected to accelerate the APAC synchronous condenser market. Existing and planned enhancements and extension of the HVDC network are expected to increase the demand for power factor correction devices, such as synchronous condensers, in different APAC countries. High investments by key market players across the APAC region to build a strong HVDC network among major countries are further fueling the demand for synchronous condensers. Technological progress in HVDC transmission systems is expected to assist in minimizing wind and solar-based electricity transmission system operational problems, as the phase gap in the HVDC transmission line does not matter. Although traditional HVAC does not operate on this principle, transformers are required to fit the stage generated from a different source. This is also expected to provide a better opportunity for the HVDC transmission system to expand across APAC countries. Increased renewable energy penetration has accelerated the adoption of HVDC transmission networks. Thus, the above-mentioned factors are contributing to the growth of the APAC synchronous condenser market.
Furthermore, in case of COVID-19 outbreak, APAC, especially China, is highly affected. The country also homes the largest population across the world, thereby imposing greater risk of infection. China is also a world leader of many global brands. According to the Organization for Economic Co-operation and Development, the pandemic has also affected other major economies, such as India, Australia, and Japan are experiencing downward inflation. The sudden shutdown of all economic activities, which includes manufacturing plants of both essential products and luxurious items, has impacted the overall economy of the countries in the region. China, being the manufacturing hub of the world, has many major players and distributers located in the country. The temporary shutdown of supply chain to both local and global manufacturers of the condensers is expected to negatively impact the market. Additionally, the reduction in demand for power by 25–30% has been observed across countries, such as India. This decrease in demand, combined with decreased collection and slow recovery, would have a negative effect on the synchronous market across the region. This, in turn, is expected to adversely impact the demand for synchronous condensers in the region.
Based on application, the electrical utilities and grid operators segment led the APAC synchronous condenser market in 2019. Synchronous condensers assist in achieving grid reliability, stability, inertia, and strength for electrical utilities. Demand is expected to drive the synchronous condenser market for grid stability and controlling voltage fluctuations in electrical utilities. Moreover, for stable operations and maintaining voltage stability with weak grids, power plants install synchronous condensers. On electrical power transmission networks, synchronous condensers help to adjust the reactive power. Either condensers are installed in existing plants or synchronous condensers can be retrofitted with old generators in the plant. Siemens received a contract from Welsh Power for the South Wales grid stabilization facility in October 2020. Siemens uses its synchronous condenser and flywheel technology, which provides inertia to reinforce the grid, short circuit power to ensure reliable operation, and reactive voltage control power. Further, in case of wind farms, synchronous condensers are installed on the electricity grid for effective operation. In the coming years, synchronous condensers would witness an upsurge in demand. For example, in 2018, Siemens delivered the first synchronous condenser to Australia's solar farm. Advantages of synchronous condensers, such as grid stability, fluctuation controller, and stable operations, are expected to increase their demand from electrical utilities and grid operators, which would drive the APAC synchronous condenser market.
The overall APAC synchronous condenser market size has been derived using both primary and secondary sources. To begin the research process, exhaustive secondary research has been conducted using internal and external sources to obtain qualitative and quantitative information related to the APAC synchronous condenser market. The process also serves the purpose of obtaining overview and forecast for the APAC synchronous condenser market with respect to all the segments pertaining to the region. Also, multiple primary interviews have been conducted with industry participants and commentators to validate the data, as well as to gain more analytical insights into the topic. The participants who typically take part in such a process include industry experts, such as VPs, business development managers, synchronous condenser market intelligence managers, and national sales managers, along with external consultants, such as valuation experts, research analysts, and key opinion leaders specializing in the APAC synchronous condenser market. ABB Ltd.; Brush Group; Eaton Corporation plc; FUJI ELECTRIC CO., LTD.; General Electric Company; Siemens AG (Siemens Energy); Voith GmbH & Co. KGaA; and WEG ELECTRIC CORP. are among key players operating in the APAC synchronous condenser market.