Powered by a humongous application spectrum, power electronics market, in the future, is expected to be characterized by application-oriented research and development is system modelling, analysis, modularization, design and real time simulation. Power electronics finds massive applications in commercial, industrial, residential, military, aerospace and electrical utility systems. In the recent years, the technology has witnessed a dynamic evolution of sorts, leading to the exponential growth of power electronics market. Not to mention, this business space is expected to receive considerable boost from the ever-increasing legislative efforts regarding energy conservation. In essence, the rise of renewable energy and hybrid vehicles is certain to have a powerful impact on power electronics market.
U.S. power electronics market size, by product, 2016 & 2024 ($Mn)
The product’s usage in motor drives has a pivotal role to play in the expansion of power electronics market. By extension, the product is deployed extensively in solid state starters, pumps and compressors, transportation, machine tools, and robotics. That aside, considering the impact it has on renewable energy generation and high efficiency energy systems, power electronics industry has been forecast to attain unprecedented growth in the ensuing years.
Speaking along the lines of global energy usage, the per capita consumption of energy has now become an indicator of the living standards of the country under consideration. Thus, USA and Switzerland where power consumption is significantly higher, are considered to have the highest living standards. Increasing population can also lead to greater power consumption, a trend that has become particularly apparent in the emerging economies such as India and China. With the rise in the demand for energy and the depleting rate of natural fuel resources, renewable sources have come to emerge as the go-to option. This would directly stimulate power electronics market across myriad geographies, given that the application of power electronics in smart grids is becoming increasingly commonplace. Indeed, smart grids use digital communications & control systems to monitor power flows and are also known to conveniently integrate renewable energy. This would undeniably augment power electronics market share in the forthcoming years.
Power electronics-based equipment are around 98% efficient in energy savings. With the advancement of technology and improving performance of power electronics-based tools coupled with the decreasing cost of such tools, power electronics industry will traverse on a profitable path over 2017-2024. Power electronics industry is also benefitting from the apparent financial advantage these products offer by saving energy. The lowered cost of electric consumption offsets the higher cost of power electronics. Reduced consumption of energy in consequence leads to reduced energy generation, thereby contributing toward directly mitigating environmental pollution.
The financial benefits provided by the expansion of power electronics market can be comprehensively validated through the instance of CFL and LED lamps. In the US, lighting uses around 20% of the grid energy. As CFLs replaced incandescent lamps, energy efficiency in lighting increased fourfold. With the emergence of LED lamps, that have five times longer life span than CFLs, energy consumption was found to have been halved. As electric power grids are replaced with intelligent, state-of-the-art-grids, savings of 20% on global energy demand has been anticipated with 15%-20% savings in the form of energy waste elimination. It goes without saying that the deployment of power electronics would be about substantial saving in energy and costs, which would prove to be a vital factor augmenting power electronics market outlook.
The EV sector has emerged as a major growth avenue for power electronics industry. Electric vehicles adopt power electronics massively to convert DC to AC. In this regard, it would also seem appropriate to state that environmental regulations driving electric vehicle sector will have a commendable influence on the growth of power electronics market.
Having recognized the growth potential of power electronics industry, regional governments and regulatory bodies have been undertaking numerous initiatives with regards to renewable energy and EV adoption. For instance, the government of UK offers grants and subsidies well above USD 5,944 to electric vehicle owners to increase EV adoption and decrease the total ownership expense. Besides, EV owners with the ownership cost less than USD 52,844 are also exempted from paying annual road taxes. Not to mention, the commercialization potential of power electronics market is also expected to upsurge with a slew of technological interventions brainstormed by reputed electronic behemoths. In terms of profitability, this fraternity is anticipated to surpass USD 45 billion by 2024.