PUBLISHER: Market Xcel - Markets and Data | PRODUCT CODE: 1655618
PUBLISHER: Market Xcel - Markets and Data | PRODUCT CODE: 1655618
Global low power transformers market is projected to witness a CAGR of 7.89% during the forecast period 2025-2032, growing from USD 10.48 billion in 2024 to USD 19.24 billion in 2032. The market has experienced significant growth in recent years due to interrelated factors such as the evolving landscape of energy consumption and infrastructure development and is expected to maintain a strong pace of expansion in the coming years. The increasing demand for low-power transformers is primarily driven by the global push toward electrification, particularly in emerging economies. This trend is further amplified by ambitious renewable energy targets set by governments worldwide to combat climate change. Integrating renewable energy sources into existing electrical grids necessitates reliable technologies like low-power transformers, which are crucial for managing the variable nature of renewable energy generation and ensuring stable voltage levels for distribution. Furthermore, the growing electrification of the transportation sector requires a robust power infrastructure, boosting the demand for low-power transformers capable of converting AC power from charging stations into usable DC power. Finally, increasing energy consumption across various sectors is accelerating investment in electrical infrastructure, further fueling the demand for low-power transformers.
For instance, in November 2024, as per the EIA report, in the United States, the rise in the demand for electricity from different end users led to an increase in capital spending on the distribution system. Capital investment in distribution infrastructure increased by USD 31.4 billion, or 160%, from 2003 to 2023. This development highlights the rising power consumption driving the demand for low-power transformers in the market.
Technological advancements in transformer design are also enhancing efficiency and performance, making modern low-power transformers more attractive for utilities and industrial sectors. Developing countries are seeking to modernize their electrical infrastructure while meeting rising demands for reliable energy solutions, thus driving growth in the low-power transformer market. Supportive government policies and regulations that promote energy efficiency and safety standards further incentivize investments in these transformers. These combined factors position the low-power transformer market for significant expansion over the coming years.
Rising Investment in Electrification and Efficient Electrical Infrastructure Development Fuel Low-Power Transformer Market Growth
Developing countries are investing heavily in infrastructure and energy sectors to accommodate rapid urbanization and industrialization. Regions such as Asia-Pacific, Africa, and South America are witnessing large-scale industrial, residential, and commercial construction projects. These developments require substantial electricity consumption, driving demand for low-power transformers to safely distribute and regulate power loads. Concurrently, global initiatives to electrify rural and underserved areas supported by government policies and private-sector grid expansions are further accelerating market growth for these transformers. This dual focus on urban infrastructure development and rural electrification positions the low-power transformer market for sustained expansion during the forecast period.
For instance, in April 2024, European Investment Bank (EIB) granted a loan of USD 411 million to municipal energy supplier Thuringer Energie AG (TEAG) to upgrade and digitise the electricity grid in Thuringia, Germany. The investment will enhance grid performance to support energy transition initiatives. This development reflects growing investments in electrification infrastructure is driving demand for low-power transformers in the market.
Furthermore, the growing awareness of climate change has led to a focus on sustainable practices within the electrical sector which is leading to the deployment of efficient electrical equipment in the system. The low power transformers assist in minimizing the energy losses during transmission and support renewable energy grid integration which aligns with global sustainability goals, thus making the low power transformer more demanded equipment in the market.
Rise in Integration of Renewable Energy Creates Market Opportunity
Low power transformers play a vital role in addressing the challenges associated with managing a more complex and variable energy landscape. Low power transformers facilitate the conversion of high-voltage electricity generated from renewable sources into usable levels for distribution, driving their market demand. Additionally, low power transformers help stabilize voltage fluctuations, ensuring that the electricity produced meets grid standards, which prevents outages and maintains a reliable supply. Furthermore, low power transformers are essential for stepping up voltage to medium levels suitable for grid transmission. Low power transformers are capable of seamlessly integrating renewable energy into existing electrical infrastructure without causing instability or damaging equipment creating significant opportunities for growth in the low power transformer market in the coming years.
Globally every sector is highly prioritizing the adoption of renewable energy sources into the electrical grid. Governments and companies are setting up ambitious renewable energy targets as part of the sustainability goals which could be attained by adopting the proper energy mix. As countries focus on shifting toward decarbonization and energy transition results in high demand for technologies and innovative electrical equipment which could integrate the different sources of energy with less energy loss. The integration feature of low power transformers helps to overcome the challenges and requirements of managing a more complex and variable energy landscape. The low power transformers assist in converting high-voltage electricity generated from renewables into usable levels for distribution which drives its demand in the market.
For instance, in August 2024, the Department of Energy (DOE) of the United States decided to invest USD 2.2 billion in the nation's power grid. As part of the Bipartisan Infrastructure Law's Grid Resilience and Innovation Partnerships (GRIP) Program, funding is allocated to eight major projects across 18 states, improving grid resilience. This development highlights the inclination towards renewable energy integration, which drives the demand for low-power transformers in the market.
Split Core Transformers to Dominate the Market Share
The split-core transformer segment is expected to see high adoption rates and is expected to dominate the market during the forecast period. This growth is primarily due to the ease of installation and versatility of split-core transformers. Split-core transformers' ease of installation around existing wiring minimizes downtime and costs, making them ideal for retrofitting and upgrading existing electrical systems. Their versatility in space-constrained environments and ability to maintain accuracy without circuit interruption further solidify their dominance in diverse applications.
Furthermore, split core transformers facilitate the integration of variable energy sources into existing electrical grids, helping to stabilize power supply and improve grid reliability. The ongoing electrification of various sectors, including transportation and industrial processes, has led to a higher demand for transformers to manage power loads which drive the demand for split core low power transformers in the market.
Asia-Pacific Leads the Low Power Transformers Market
Asia-Pacific dominates the low power transformers market and holds the largest market share. The Asia-Pacific region comprises numerous developing countries which are heavily investing in renewable energy sources and enhancing the power distribution sectors, which drives low power transformer market growth. Notably, China and India are among the largest energy consumers, significantly contributing to global consumption levels. Several developing countries in the region are focused on modernizing their power grids, which aim to improve energy efficiency, reduce transmission losses, and ensure a reliable power supply.
Additionally, developing nations are prioritizing the manufacturing sector and the electrification of rural areas which further increases the demand for low power transformers in the region. The growing interest in electrifying the transportation sector in these countries is expected to be a major factor propelling the market growth during the forecast period.
For instance, in January 2025, the Indian power sector presents an investment opportunity of around USD 461.95 billion over the next decade which is driven by rising demand for infrastructure upgrades, and the transition to clean energy. This development highlights the rising investment in the power sector which drives the demand for the low power transformers in the coming market.
Future Market Scenario (2025 - 2032F)
Massive investments in infrastructure projects across Asia-Pacific region is driving the demand for low power transformers in coming years.
Governments are focusing on modernizing existing facilities and constructing new ones, including power plants fostering the demand for low power transformers in the forecast period.
Rise in electrification of rural area, result in rise in the demand for low power transformers in developing countries which lead to growth of the market.
The industrial sector heavily investing in automation which drives the demand for low power transformers in industrial applications in the coming years.
Key Players Landscape and Outlook
Continuous innovation characterizes the landscape of low power transformers globally, as the companies compete in terms of energy efficiency, product life, and unique features. The market outlook remains positive, owing to increased demand for the integration of renewable energy and automation in the industrial sector. Product launches, agreements, business expansions, collaborations, and developing technologies are projected to increase competition in the fast-paced market.
For instance, in January 2025, GE Vernova Inc. is planning to invest nearly USD 600 million in its United States factories and facilities over the next two years to help meet the surging demand for electrical equipment. This development will help the company to increase its production capacity and strong hold in United States market in the coming years.
All segments will be provided for all regions and countries covered
Companies mentioned above DO NOT hold any order as per market share and can be changed as per information available during research work.