Asia’s energy consumption is expected to rise dramatically in the next few decades. Demand for and cost of energy will only increase with future population growth and increased industrialization. As energy is one of the largest components of industrial cost structures, most industries will strive for energy efficiency solutions. This will directly impact the growth of the high power AC drives market as manufacturers and other industrial operations address initiatives for energy cost savings and reduced energy consumption. Asia, which is the largest market for high power AC drives with almost 42 percent of the total revenues, will continue to be a leading growth engine for the high power AC drives market through the forecast period, according to a new ARC Advisory Group study, “High Power AC Drives for Asia Market Research Study”.
Industrial companies in Asia continue to demand energy efficiency, higher productivity, and flexibility in their operations. While uncertainty of the economy due to several countries in the Eurozone and a slowdown in China’s growth will put a drag on the market during 2012, market growth in power and automation solutions for Asia is expected to continue beyond 2012, with increasing market demand for building new and upgrading existing power infrastructure and improving industrial efficiency and productivity. These factors will spur the use of high power AC drives even during uncertain economic periods.
Growth in Energy and Infrastructure Industries
With the growth of the global economy, developing economies in Asia will demand more energy and basic materials. This will spur increased production of electricity, oil & gas, aluminum, chemicals, paper, and steel. Also, more resources, such as metals, oil, natural gas, and minerals will be produced, increasing the use of automation and high power AC drives.
The market growth for automation and high power AC drives will be largely due to massive consumption in the infrastructure industries. In both developed and emerging economies, infrastructure development continues. As a result, investments in automation equipment, including all categories of AC drives, will continue in sectors such as electric power generation and water & wastewater. The food & beverage, pharmaceutical, and consumer packaged goods industries, as well as renewable energy applications, will also make investments in high power AC drives during the forecast period.
Regional Dynamics Favor Emerging Economies
With higher GDP projections in the coming years for emerging economies in Asia, there will be an increasing demand for a broad range of products, stimulated by increased consumer consumption and additional infrastructure projects. This will increase the demand for more automation and high power AC drives in the oil & gas, metals & mining, and cement & glass industries, as well as many other segments of the process and discrete industries. Also, as the focus of growth for the high power AC drives market is shifting to the emerging economies, production is also moving to those areas, particularly to India and China. “Now industries are more aware than ever of their energy use and have begun to align their operations to manage energy consumption and costs. The use of automation equipment, including AC drives, is the most critical tool in achieving energy saving goals,” according to G. Ganapathiraman, Country Manager, ARC India and co-author of this study.
In addition to the quantitative assessment of the high power AC drives market, this ARC study provides an insightful analysis of the products and strategies of the leading high power AC drives suppliers and explores issues that will impact these businesses well into the future.