According to Stratistics MRC, the Global Volt/VAR Management Market is accounted for $536.40 million in 2022 and is expected to reach $846.49 million by 2028 growing at a CAGR of 7.9% during the forecast period. Volt/VAR management lowers energy loss by reducing reactive power flows, maintaining voltages within the limits, and also limiting peak power by lowering voltage. The first step towards modernised grid automation is fault awareness of the medium voltage and low voltage grid. It improves voltage control and increases network hosting capacity.

According to IEA (International Energy Agency), the worldwide energy demand grew by 4% (900 TWH) in 2018. The highest amount of energy was consumed by industrial segment of around 8945 TWH in 2017 as compared to 8699 TWH in 2016.

Market Dynamics:

Driver:

Rising demand for efficient distribution and energy management in the electrical sector

The market for volt/VAR management is being driven by rising power demand. Manufacturers have raised the bar for innovation as a result of the electrical industry's need for efficient distributed energy management. In 2019, EcoStruxure Power, an architecture tool from Schneider Electric, was released. The solution is intended to increase the stability, efficiency, and resilience of electric industry micro grids. The emergence of Schneider's product heightened non-price competition throughout the market, inspiring many other manufacturers to commit to developing new products.

Restraint:

High installation costs

Depending on the procedure type, VVO costs and benefits vary. The installation of equipment and systems for voltage control and VAR management requires additional capital investments as well as operating and maintenance costs. To reduce fuel costs and emissions from reduced fossil-fired generating, increase the real-power capacity of impacted feeders, postpone capital enhancement projects for generation, transmission, and distribution, and lower fuel prices.

Opportunity:

Increasing focus on load flow of electricity

Network connectivity analyses and switching schedules are necessary for large industrial and commercial units. Volt/VAR management systems must be implemented by industrial leaders as a result of this. Voltage management has been required in a Variety of sectors as the G20 works to develop a highly coordinated electrical industry. Therefore, the existence of a booming industry for electrical network and voltage monitoring is not a misconception.

Threat:

Limited capacity

Volt-VAR has attained a lot of interest because it does not require generation curtailment. However, household-scale PV inverters are sized (kVA) to handle the panels' maximum active power generation (kW). They have a limited capacity to absorb reactive power (kVAR) during times of high generation because active power generation is typically given priority. Analysis shows that Volt-VAR control fails when reactive power is most needed when taking into account Various Volt-VAR curves and PV penetrations. Reactive power also raises currents and, consequently, asset utilisation.

COVID-19 Impact:

The pandemic severely harmed all electrical and electronics businesses. Power is necessary for economic expansion, especially in emerging markets. Achieving SDG 7 (Achieving Sustainable Development Goals), which aims to ensure that everyone has access to reliable, affordable, sustainable, and modern energy, is necessary for the accomplishment of many other SDGs, including those pertaining to sustainable cities, industry, sustainable health, and education.

The distribution segment is expected to be the largest during the forecast period

Due to the increased deployment of smart grids and the need to reduce power outages and faults in distribution feeders, the distribution segment of the volt/VAR management market is anticipated to dominate the worldwide market during the forecast period. Furthermore, increase in demand of electricity from residential sector might propel the market in this segment.

The electric utility segment is expected to have the highest CAGR during the forecast period

Because the service helps utilities supply the proper voltage to end-consumers at the ideal power factor to minimise losses, the electric utility segment accounted for the highest growth rate during the forecast period in the Volt/VAR management market. Additionally, in economies like China, India, and the US, the demand for power is anticipated to rise significantly over the forecast period, which is anticipated to increase the need for volt/VAR management.

Region with largest share:

Due to technological advancements of components used in the transmission and distribution process, North America is predicted to hold the largest market share during the period of the forecast for the global Volt/VAR management market. Furthermore, the regional demand may be influenced by a wide range of applications, the manufacture of electric vehicles, and the pressing need to reduce energy costs.

Region with highest CAGR:

Because of significant market demand brought on by investments from renewable energy providers and the need to contain rising energy prices in developing economies like India and China, Asia Pacific is anticipated to grow lucratively during the forecast period. Additionally, in the event of new renewable energy projects, installing Volt/VAR systems in various locations for managing power generated will benefit the market in this region.

Key players in the market

Some of the key players in Volt/VAR Management market include Open Systems International, ABB, GE Company, Schneider, S&C Electric Company, Advanced Control System, Eaton, Siemens, Utilidata, DVI, Landis+Gyr, Beckwith Electric, VArentec and DC System.

Key Developments:

In June 2019, ABB was awarded a power transmission contract by the State Grid Corporation of China (SGCC). The company plans to use high-voltage equipment such as breakers to safeguard the grid from disruptive failures and capacitor banks to improve the quality of the energy supply, extending product life and lowering losses.

In February 2019, Schneider Electric released the Ecostruxure Power 2.0. EcoStruxure Microgrid Operation is used in the latest EcoStruxure Power architecture to control Distributed Energy Resources (DER) and protection systems for better microgrid stability and efficiency increasing the Volt/VAR Management Market.

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Benchmarking of key players based on product portfolio, geographical presence, and strategic alliances