Electricity Trading Market to Grow with a CAGR of 5.50% through 2028
Increasing cross-border power trading and rising renewable
energy generation are likely to drive the market in the forecast period.
According to TechSci Research report, “Electricity
Trading Market – Global Industry Size, Share, Trends, Competition Forecast
& Opportunities, 2028”, the Global Electricity Trading Market stood at
USD 107.08 billion in 2022 and is anticipated to grow with a CAGR of 5.50% in
the forecast period.
One of the primary drivers propelling the global
Electricity Trading market is the escalating integration of renewable energy
sources. With a growing emphasis on environmental sustainability and reducing
carbon emissions, renewable energy technologies such as wind, solar, and
hydroelectric power are gaining prominence in the energy landscape. Renewable
energy generation, however, is often intermittent and location-dependent. This
means that electricity production from renewables varies throughout the day and
is concentrated in specific geographical areas. The Electricity Trading market
addresses this challenge by enabling the efficient exchange of surplus
renewable energy from regions with excess generation to those with higher
demand or during periods of scarcity. This cross-border trading reduces the
reliance on fossil fuel-based power generation and aids in the global
transition to cleaner energy sources. Furthermore, renewable energy projects
often require substantial investments, and Electricity Trading provides a means
for project developers to secure revenue through power purchase agreements
(PPAs) and sell excess electricity to the grid or neighbouring regions. As the
world continues to prioritize renewable energy, the Electricity Trading
market's role in optimizing clean energy resource utilization becomes
increasingly pivotal.
Grid modernization and the adoption of smart grid
technologies serve as another significant driver of the global Electricity
Trading market. Traditional electrical grids were initially designed for
one-way power flow, primarily from centralized power plants to consumers.
However, these grids are ill-equipped to accommodate the increasing prevalence
of decentralized energy resources, such as rooftop solar panels and electric
vehicles (EVs). Smart grids integrate
advanced technologies like digital meters, sensors, and communication networks
to enable bidirectional energy flows, real-time monitoring, and data-driven
decision-making. This enhanced grid infrastructure enhances reliability,
resilience, and efficiency. It also contributes to more efficient Electricity
Trading by providing precise information on energy supply and demand. Smart
grids facilitate demand response programs, which incentivize consumers to
adjust their electricity consumption during peak hours, alleviating stress on
the grid and reducing costs. Additionally, smart grid technologies enable the
integration of energy storage solutions, which play a pivotal role in balancing
electricity supply and demand and improving the overall efficiency of
Electricity Trading markets.
In conclusion, the integration of renewable energy
sources and the adoption of grid modernization and smart technologies are two
compelling drivers reshaping the global Electricity Trading market. These
factors enhance grid reliability, reduce carbon emissions, and optimize the
allocation of electricity resources, promoting a more sustainable and efficient
energy future.
Browse over XX market data Figures spread
through XX Pages and an in-depth TOC on "Global Electricity
Trading Market.”
The Global Electricity Trading Market is segmented
into type, application and region.
Based on type, The Day-Ahead Trading segment held the largest
market share in 2022 & expected to maintain it in the forecast period.
Day-Ahead Trading allows market participants, including electricity generators,
retailers, and large consumers, to plan their electricity supply and demand for
the following day. This longer lead time provides an opportunity for participants
to manage risks associated with uncertain variables such as weather conditions,
equipment maintenance, and fuel availability. It enables utilities to secure a
significant portion of their anticipated electricity needs, reducing the
uncertainty associated with short-term market fluctuations. Market Liquidity:
Day-Ahead Markets typically have higher liquidity compared to Intraday Markets.
This means there are more participants actively buying and selling electricity
for future delivery. Higher liquidity leads to better price discovery and
reduces the risk of price manipulation. It also attracts a wider range of
market participants, including financial institutions, which can enhance market
efficiency. For electricity generators, Day-Ahead Trading provides a valuable
opportunity to optimize their generation schedules. By submitting bids and
offers a day in advance, generators can plan their operations more efficiently,
taking into account factors like fuel costs, maintenance schedules, and
commitments to meet renewable energy targets. This optimization can lead to
cost savings and improved grid reliability. Day-Ahead Markets play a crucial
role in supporting the integration of renewable energy sources, such as wind
and solar power. These sources are often characterized by variable and
uncertain generation patterns. Day-Ahead Trading allows utilities and grid
operators to forecast renewable energy output and plan for backup generation or
energy storage to ensure a stable power supply. Day-Ahead Markets typically
have well-defined rules and transparent mechanisms for price determination.
This transparency fosters trust among market participants and regulators. It
also allows for effective competition and price discovery, which benefits both
buyers and sellers. Day-Ahead Trading
contributes to grid reliability by allowing grid operators to anticipate and
plan for electricity demand patterns.
Based on application, The Industrial segment held the largest
market share in 2022 and is projected to experience rapid growth during the
forecast period. Industrial facilities, including manufacturing plants,
factories, and heavy industries, typically have significantly higher energy
demands compared to commercial and residential consumers. These
energy-intensive operations require substantial electricity to power machinery,
equipment, and production processes. As a result, industrial consumers often
account for a significant portion of total electricity consumption in many
regions. Economic Impact: Industrial sectors often play a crucial role in a
country's economy by contributing to job creation, exports, and economic
growth. To remain competitive and maintain production levels, industries are
highly motivated to manage energy costs effectively. Electricity trading
provides them with opportunities to secure reliable power supplies at
competitive prices, reduce operational expenses, and enhance their overall
economic performance. Energy Cost Management: Electricity represents a
substantial portion of operational costs for industrial facilities. To maintain
profitability, industries seek ways to manage and control energy expenses.
Electricity trading allows them to negotiate contracts, participate in competitive
wholesale markets, and explore cost-effective procurement strategies. By
actively managing their energy portfolios, industries can optimize their energy
expenditures. Load Flexibility: Many industrial processes are amenable to load
flexibility, meaning they can adjust their electricity consumption patterns in
response to price signals or grid conditions. Electricity trading enables
industries to leverage this flexibility by participating in demand response
programs or shifting their energy-intensive operations to times when
electricity prices are lower. This dynamic load management can lead to cost
savings and support grid stability. Energy efficiency is a priority for
industries seeking to reduce waste and environmental impact. Electricity
trading can incentivize industrial consumers to implement energy-efficient
technologies and practices that lower their overall electricity consumption. By
reducing energy waste and optimizing their processes, industries can improve
their competitiveness and sustainability.
Major companies operating in the Global Electricity
Trading Market are:
- BP plc
- Equinor ASA
- E.ON SE
- RWE AG
- Engie SA
- Électricité de France (EDF) Trading
- TotalEnergies SE
- Axpo Holding AG
- Centrica plc
- Next Kraftwerke GmbH
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“The Global Electricity Trading market is expected to
rise in the upcoming years and register a significant CAGR during the forecast
period. Renewable energy sources, such as solar and wind power, are becoming
increasingly popular due to their environmental benefits and declining costs.
This is leading to an increase in the need for electricity trading to balance
supply and demand from renewable sources. Cross-border power trading is
becoming more common as countries seek to diversify their energy mix and improve
energy security. This is creating new opportunities for electricity traders.
Also, Energy storage systems can help to store electricity generated from
renewable sources and release it when needed. This is making electricity
trading more flexible and efficient. Therefore, the market of Electricity
Trading is expected to boost in the upcoming years.,” said Mr. Karan Chechi,
Research Director with TechSci Research, a research-based management consulting
firm.
“Electricity Trading Market - Global Industry Size,
Share, Trends, Opportunity, and Forecast, 2018-2028 Segmented By Type
(Day-Ahead Trading, Intraday Trading), By Application (Industrial, Commercial,
Residential), By Region, By Competition”, has evaluated the future growth
potential of Global Electricity Trading Market and provides statistics &
information on market size, structure and future market growth. The report
intends to provide cutting-edge market intelligence and help decision-makers make
sound investment decisions., The report also identifies and analyzes the
emerging trends along with essential drivers, challenges, and opportunities in the
Global Electricity Trading Market.
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