PUBLISHER: Stratistics Market Research Consulting | PRODUCT CODE: 1462736
PUBLISHER: Stratistics Market Research Consulting | PRODUCT CODE: 1462736
According to Stratistics MRC, the Global Protective Relay Market is accounted for $2.5 billion in 2023 and is expected to reach $4.20 billion by 2030 growing at a CAGR of 7.7% during the forecast period. Protective relays are devices used in electrical systems to detect abnormalities such as over current, overvoltage, under frequency, and other faults that could lead to equipment damage or system failure. They work by continuously monitoring electrical parameters and initiating corrective actions, such as isolating faulty sections or tripping circuit breakers, to prevent further damage or hazards. Their swift and precise response helps mitigate risks, ensuring the reliability and safety of electrical networks in various industrial, commercial, and residential settings.
According to the International Energy Agency (IEA), the global electricity demand is anticipated to witness a Y-o-Y change of 938 TWh in 2025, compared to 859 TWh in 2024.
Rising demand for electricity
As global populations grow, urbanization expands, and industrial activities increase, there's a corresponding surge in the demand for electrical power across various sectors. This escalating demand necessitates the expansion, upgrading, and modernization of electrical infrastructure, driving the adoption of protective relay systems. Protective relays play a pivotal role in ensuring the reliable and safe operation of electrical grids by detecting and responding to faults, overloads, and other abnormalities. Therefore, rising demand for electricity is a significant factor driving market demand.
High initial cost
Protective relays, especially those equipped with advanced features and digital capabilities, often require substantial upfront investments for procurement, installation, and integration into existing infrastructure. These costs stem from various factors, including the complexity of the technology involved, the need for specialized equipment and components, and the expenses associated with engineering, testing, and commissioning. As a result, a high initial cost is a significant factor limiting market expansion.
Grid modernization initiative
The grid modernization initiative is a significant driver in the protective relay market, propelling the adoption of advanced protective relay systems to support the transformation of electrical grids into smarter, more efficient, and more resilient networks. Protective relays play a crucial role in grid modernization by ensuring the stability, reliability, and safety of modernized electrical grids. Additionally, they provide essential protection against faults, overloads, and disturbances, enabling utilities to maintain system integrity and prevent cascading failures.
Lack of skilled workforce
Protective relays are complex devices that require specialized knowledge in electrical engineering, power systems, and digital technology for their installation, configuration, and troubleshooting. The shortage of qualified personnel with expertise in protective relaying can lead to several challenges. It results in delays in project implementation and commissioning as there may not be enough skilled workers available to carry out the necessary tasks. These factors hinder the market's growth.
Covid-19 Impact
The COVID-19 pandemic had a notable impact on the protective relay market. The economic uncertainty resulting from the pandemic prompted some utilities and industries to defer capital expenditures and postpone infrastructure projects, including upgrades or replacements of protective relay systems. However, the pandemic also accelerated certain trends in the protective relay market, such as the adoption of remote monitoring and maintenance solutions.
The digital/numerical relays segment is expected to be the largest during the forecast period
The digital/numerical relays segment is estimated to hold the largest share. Digital relays utilize microprocessor-based technology to provide enhanced accuracy, flexibility, and reliability in protecting electrical systems. Their advanced digital processing capabilities enable them to detect and respond to various faults and abnormalities with greater sensitivity and speed compared to their predecessors. Furthermore, digital relays offer a wide range of protective functions, including over current, overvoltage, under frequency, distance, differential, and more, all programmable and configurable to suit specific system requirements.
The utilities segment is expected to have the highest CAGR during the forecast period
The utilities segment is anticipated to have lucrative growth during the forecast period. Utilities rely on protective relays to safeguard their electrical systems from faults, overloads, and other abnormalities that could disrupt service, damage equipment, or compromise safety. Protective relays serve as the frontline defense, detecting and isolating faults swiftly to prevent cascading failures and blackouts. They help utilities maintain system reliability, minimize downtime, and ensure continuity of service to customers.
Asia Pacific commanded the largest market share during the extrapolated period owing to rapid industrialization, urbanization, and infrastructural developments. Increasing investments in renewable energy projects across the region have propelled the demand for protective relays to ensure grid stability and seamless integration of renewable sources. Additionally, stringent regulations pertaining to grid reliability and safety standards have encouraged the adoption of advanced protective relay technologies in the region.
North America is expected to witness profitable growth over the projection period due to region's robust industrial infrastructure, coupled with stringent regulatory standards for power system reliability and safety. The region's emphasis on grid modernization and smart grid initiatives has spurred the deployment of digital relays equipped with communication capabilities, enabling real-time monitoring, data analytics, and remote control functionalities.
Key players in the market
Some of the key players in the Protective Relay Market include Siemens AG, Schneider Electric, THYEAST Protection Relays Co., Eaton Corporation Plc, The International Electrical Products Company, Toshiba Corporation, Mitsubishi Electric Corp., Fanox Electronics, ABB Ltd., Doble Engineering Company, General Electric and NR Electric.
In October 2023, Siemens and Microsoft partner to drive cross-industry AI adoption. As a first step, the companies are introducing Siemens Industrial Copilot, an AI-powered jointly developed assistant aimed at improving human-machine collaboration in manufacturing.
In April 2023, Siemens and IBM announced they are expanding their long-term partnership by collaborating to develop a combined software solution integrating their respective offerings for systems engineering, service lifecycle management and asset management.
In June 2022, Eaton, the intelligent power management company collaborated with Microsoft to accelerate applications of Energy Aware uninterruptible power system (UPS) technology in key segments worldwide.