Press Releases

Smart Grid Technologies Drive Growth for Low Voltage Contactors Market
Date: 27 October 2011

In a recently published study from IMS Research, entitled The World Market for Low Voltage AC & DC Contactors and Overload Protection Devices – 2011, the global trend towards installing smart grid technologies is forecast to be the strongest market driver for low voltage contactors over the next five years, spurring contactor market revenues to over $5 billion by 2016.

Contactors are traditionally used to start and control AC induction motors, where large power switching may occur and safety is a concern. The market here for contactors generally follows machinery production forecasts and is tied in heavily to underlying GDP forecasts. However, adoption of smart grid technologies drove 2010 volumes up higher than expected, and is forecast to continue to do so as smart grid initiatives gain momentum worldwide. Comments report author Michael Markides, “With more decentralized power generation, and more parties likely to act as electricity providers, the need for safe and reliable power switching is expected to increase. Growth in renewable energy, and related grid integration and management of renewable energy, is the single strongest driver for further adoption of contactors in power switching.”

2010 market revenues grew to an estimated $3 billion for contactors, with over a third of the revenues being for contactors sold into power switching. By 2016, revenues for contactors sold into power switching alone are forecast to reach $2 billion globally, or just over half the total projected market revenues. Adds Markides, “All parts of electricity infrastructure, including generation, distribution and consumption, are rapidly adopting some level of smart grid technology. As a result, suppliers of contactors will increasingly shift attention to OEMs that manufacture devices such as electric vehicle charging stations, solar and wind inverters, generators, UPS, capacitor banks and electrical paneling, all key end equipment types forecast to grow the power switching segment for contactors over the next five years.”

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