POWER TRANSFORMER MARKET ANALYSIS

Power Transformer Market Size and Trends

The power transformer market is estimated to be valued at US$ 29.28 billion in 2025 and is expected to reach US$ 54.25 billion by 2032, exhibiting a compound annual growth rate (CAGR) of 9% from 2025 to 2032.

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Rapid industrialization and infrastructure development across major economies are driving significant investment in improving and expanding transmission and distribution networks. This is expected to increase the demand for power transformers for efficient power transmission and distribution over the coming years.

The market is witnessing growing adoption of smart transformers globally. The increasing deployment of renewable energy and growing emphasis on energy efficiency are propelling the demand for smart transformers. Additionally, the ageing existing grid infrastructure in developed markets is compelling utilities to replace legacy transformers with smart and digitally enabled solutions for effective grid management. This trend is expected to gather further steam in the coming years.

Aging power infrastructure

Many of the existing power grids and transmission infrastructure in developed as well as developing nations are aging and need replacement. Transformers are at the heart of these transmission and distribution networks and play a critical role in ensuring uninterrupted power supply. According to our analysis, power grids in the U.S., Europe, and parts of Asia Pacific average 25-35 years of age. The constant wear and tear over several decades has reduced their performance efficiency and reliability. Utilities and grid operators are under pressure to modernize and strengthen their transmission capabilities to meet the growing electricity demand. This provides a steady demand for the replacement of old and obsolete power transformers with new and more efficient models. Additionally, governments and regulatory bodies in different countries have also introduced stricter norms regarding transmission losses as part of their climate change commitments. This is further propelling the need for upgrades to limit energy wastage during long-distance bulk power transportation.

For instance, in 2022, the region produced approximately 14,546.4 TWh of electricity, which represented about 49.8% of the world's total electricity generation, according to the Energy Institute Statistical Review of World Energy 2023.