|
Forecast Period
|
2024-2028
|
|
Market Size (2022)
|
USD 22.08 Billion
|
|
CAGR (2023-2028)
|
9.19%
|
|
Fastest Growing Segment
|
Extra-High-Voltage
Direct Current
|
|
Largest Market
|
North
America
|
Market Overview
Global Submarine DC Electric Cable Market was
valued at USD 22.08 billion in 2022 and is anticipated to project robust growth
in the forecast period with a CAGR of 9.19% through 2028.
The global submarine DC
electric cable market refers to the industry segment dedicated to the design,
manufacturing, installation, and maintenance of specialized electrical cables
intended for underwater use. These cables are specifically engineered to transmit
direct current (DC) electrical power between various points beneath the sea,
often across significant distances. They play a crucial role in facilitating
the transmission of electricity for a diverse range of applications, including
offshore renewable energy generation (such as offshore wind farms),
interconnection of power grids between countries or regions, and powering
subsea oil and gas exploration and production activities.
The market encompasses a
broad spectrum of participants, including cable manufacturers, energy
companies, infrastructure developers, and technology innovators. Key drivers of
this market include the increasing global demand for clean energy, the need for
cross-border energy exchange, and the growth of offshore industries. Challenges
include environmental impact concerns, strict regulatory compliance, and the
high cost of manufacturing, installation, and maintenance. The submarine DC
electric cable market is characterized by ongoing technological advancements
aimed at enhancing cable performance, durability, and efficiency, as well as a
growing emphasis on sustainability and environmental responsibility.
Key Market Drivers
Expanding Renewable Energy
Infrastructure
One of the key drivers
propelling the global submarine DC electric cable market is the rapid expansion
of renewable energy infrastructure, particularly offshore wind farms. As
nations around the world strive to reduce their carbon footprint and transition
to cleaner energy sources, offshore wind has emerged as a significant
contributor to this goal. Submarine DC electric cables are essential for
transmitting electricity generated by offshore wind turbines to the mainland
power grid.
Offshore wind farms are
being constructed in various regions, including the North Sea, the Baltic Sea,
the Atlantic Ocean, and many others. These offshore installations require
extensive cabling systems to transport the electricity efficiently and reliably
to onshore substations. Submarine DC cables, with their low transmission losses
and high voltage capacity, are the preferred choice for this purpose. This
driver is expected to continue fueling the demand for submarine DC electric
cables in the coming years.
Interconnectivity and
Cross-Border Energy Trade
The global trend towards
interconnectivity and cross-border energy trade is another significant driver
in the submarine DC electric cable market. As countries seek to diversify their
energy sources and ensure energy security, interconnecting their power grids
through submarine cables becomes increasingly important.
These interconnections
allow for the exchange of electricity between neighboring nations, optimizing
energy resources, and providing backup during shortages or emergencies.
Submarine DC cables are well-suited for this purpose due to their high voltage
capacity and ability to transmit electricity over long distances with minimal
losses. As countries across Europe, Asia, and other regions work on grid
interconnections, the demand for submarine DC electric cables will continue to
rise.
Growing Demand for Data
Centers and Submarine Fiber Optic Cables
The growing demand for data
centers and the expansion of submarine fiber optic cables are indirectly
driving the submarine DC electric cable market. Data centers require reliable
power sources, and many of them are located in proximity to coastal areas.
Submarine DC electric cables are often used to provide backup power to these
critical facilities, ensuring uninterrupted data processing and storage.
Moreover, the expansion of
submarine fiber optic cables, which are vital for global data communication,
often goes hand-in-hand with submarine DC electric cables. These fiber optic
cables require power for their amplification and transmission equipment, and
submarine DC cables provide a convenient and efficient means of supplying this
power underwater. As the data center and submarine fiber optic cable industries
grow, they will contribute to the demand for submarine DC electric cables.
Aging Infrastructure
Replacement
Aging submarine electric
cable infrastructure is a driver that is gradually gaining prominence in the
market. Many submarine cables laid decades ago are reaching the end of their
operational life, necessitating replacement. This presents an opportunity for
cable manufacturers to supply modern, high-capacity submarine DC electric
cables that offer improved performance, durability, and efficiency.
Utilities and cable
operators are investing in the replacement of these older cables with more
advanced technologies to enhance grid reliability and transmission capacity.
This driver, while not as rapid as some others, contributes to the sustained
demand for submarine DC electric cables as part of infrastructure modernization
efforts.
Offshore Oil and Gas
Exploration and Production
The offshore oil and gas
industry remains a substantial driver for the submarine DC electric cable
market. Submarine cables are essential for powering offshore drilling
platforms, subsea production equipment, and underwater communication systems.
As offshore exploration and production activities continue in various regions,
the demand for reliable and efficient submarine DC electric cables to support
these operations remains robust.
The offshore energy
industry is also witnessing a transition toward cleaner energy solutions, such
as electrification of offshore platforms and subsea power distribution.
Submarine DC electric cables are integral to these efforts, facilitating the
transmission of electricity from shore-based power generation facilities to
offshore installations. This shift further strengthens the role of submarine DC
cables in the offshore energy sector.
Government Initiatives and
Regulations
Government initiatives and
regulations promoting renewable energy, grid integration, and energy security
play a pivotal role in driving the submarine DC electric cable market. Many
governments worldwide are actively encouraging the development of offshore wind
farms, grid interconnections, and the transition to cleaner energy sources.
To achieve these
objectives, governments often provide financial incentives, subsidies, and
regulatory support to companies involved in submarine cable projects. These
initiatives not only stimulate market demand but also ensure that submarine DC
electric cables meet stringent quality and safety standards. As governments
continue to prioritize sustainable energy and grid development, the submarine
DC electric cable market will see sustained growth.
In conclusion, the global
submarine DC electric cable market is influenced by a combination of factors,
including the expansion of renewable energy infrastructure, grid
interconnectivity, data center growth, infrastructure replacement, offshore
energy activities, and government initiatives. These drivers collectively
contribute to a positive outlook for the industry, driving innovation and
investment in submarine cable technology. As the world's energy landscape
continues to evolve, submarine DC electric cables will remain a crucial
component in enabling efficient and sustainable energy transmission both
onshore and offshore.
Government Policies are Likely to
Propel the Market
Offshore Wind Energy
Development Initiatives
Governments around the
world have been implementing policies to support the development of offshore
wind energy projects, a key driver of the submarine DC electric cable market.
These initiatives aim to reduce greenhouse gas emissions, enhance energy security,
and create jobs. Such policies encompass a range of measures, including
financial incentives, regulatory frameworks, and strategic planning.
One notable example is the
United Kingdom's Offshore Wind Sector Deal, which sets ambitious targets for
offshore wind capacity and investment. Under this policy, the UK government
commits to supporting the growth of the offshore wind industry by providing
financial backing and streamlining regulatory processes. Similar initiatives
can be observed in other countries, such as the United States, Germany, and
China, where governments are actively promoting offshore wind projects and,
consequently, the demand for submarine DC electric cables.
Grid Integration and
Cross-Border Interconnectivity
Grid integration and
cross-border interconnectivity policies are instrumental in fostering the
growth of the submarine DC electric cable market. Governments recognize the
importance of interconnected power grids for energy security, resource
optimization, and emergency response. As such, they implement policies to
encourage cross-border energy trade and the establishment of submarine cable
links.
For instance, the European
Union's Energy Union initiative aims to create a single European electricity
market, facilitated by the development of interconnections between member
states. These interconnections require submarine DC cables to transmit electricity
efficiently across national borders. Government support in the form of funding
and regulatory coordination is crucial to the success of such initiatives.
Renewable Energy Targets
and Incentives
Many governments have set
renewable energy targets and incentives to encourage the adoption of cleaner
energy sources, including offshore wind, which heavily relies on submarine DC
electric cables for power transmission. These targets often involve a mix of
regulatory mandates, financial incentives, and market mechanisms to stimulate
investment in renewable energy projects.
One illustrative case is
Denmark's ambitious plan to be carbon-neutral by 2050, which includes
substantial wind energy development in the North Sea. The Danish government
offers various incentives, such as feed-in tariffs and tax benefits, to attract
investments in offshore wind farms and associated submarine cable
infrastructure. Similar policies exist in countries like the Netherlands,
Sweden, and Taiwan, driving demand for submarine DC electric cables in the
renewable energy sector.
Environmental Regulations
and Permitting Processes
Environmental regulations
and permitting processes are critical aspects of government policies that
impact the submarine DC electric cable market. Due to the ecological
sensitivity of underwater environments, governments implement stringent
environmental protection measures and permitting requirements for submarine
cable installations.
For example, the U.S.
National Environmental Policy Act (NEPA) mandates environmental impact
assessments for submarine cable projects in American waters. Similarly, the
EU's Marine Strategy Framework Directive establishes guidelines for the
protection of marine ecosystems. Compliance with these regulations necessitates
significant investments in cable design, installation techniques, and
environmental monitoring, shaping the market's landscape.
Investment in Research and
Development
Government policies often
include provisions for research and development (R&D) funding to advance
submarine cable technology. R&D investments support innovation in cable
design, materials, and manufacturing processes, contributing to improved performance,
reliability, and efficiency.
Governments may collaborate
with industry stakeholders to establish R&D programs. For instance, the
United States Department of Energy (DOE) funds research projects related to
offshore wind technologies, including the development of advanced submarine DC
electric cables. These investments drive technological advancements that
benefit the submarine cable market by enabling higher voltage capacities,
longer transmission distances, and greater resistance to environmental
stressors.
National Security and
Resilience Measures
Governments also enact
policies related to national security and resilience, which impact the
submarine DC electric cable market, especially in regions with critical energy
infrastructure. These policies aim to safeguard the integrity of submarine
cable networks and ensure they remain operational during emergencies or
disruptions.
For instance, the United
States has established regulations to protect submarine cable landing sites and
requires companies to implement security measures to prevent sabotage or
unauthorized access. Such measures enhance the resilience of submarine cable
systems, reassuring investors and stakeholders of their reliability.
In conclusion, government
policies play a crucial role in shaping the global submarine DC electric cable
market. Policies promoting offshore wind energy, grid integration, renewable
energy targets, environmental protection, R&D, and national security all
contribute to the industry's growth and development. As governments worldwide
continue to prioritize sustainable energy and infrastructure, these policies
will continue to influence the submarine DC electric cable market's evolution
and expansion.
Download Free Sample Report
Key Market Challenges
Environmental Impact and Regulatory Compliance
The submarine DC electric cable market faces a
substantial challenge concerning its environmental impact and the rigorous
regulatory compliance required for underwater cable installations. The
installation and operation of submarine DC electric cables can have adverse
effects on marine ecosystems, and governments worldwide have imposed strict
environmental regulations and permitting processes to mitigate these impacts.
One of the primary environmental concerns
associated with submarine cable installations is the physical disruption caused
during the cable laying process. This disruption can damage fragile seabed
habitats, disrupt marine ecosystems, and harm aquatic species. Additionally,
the electromagnetic fields generated by submarine power cables can affect
marine organisms' behavior and navigation.
To address these concerns, governments have
implemented regulations and environmental impact assessment (EIA) requirements
that cable developers must adhere to. For example, the United States enforces
the National Environmental Policy Act (NEPA), which mandates comprehensive EIAs
for submarine cable projects in U.S. waters. Similarly, the European Union has
directives like the Environmental Impact Assessment Directive and the Habitats
Directive that govern cable installations in European waters.
Complying with these regulations and obtaining the
necessary permits can be a time-consuming and costly process. Cable developers
must invest in extensive environmental studies, collaborate with marine
scientists, and implement mitigation measures to minimize their projects'
impact on the environment. These measures may include using specialized
installation techniques, selecting environmentally friendly cable materials,
and conducting ongoing environmental monitoring.
Moreover, the permitting process can introduce
delays and uncertainties into submarine cable projects, affecting project
timelines and budgets. Lengthy permitting procedures can result in cost
overruns, making cable projects less attractive to investors. The challenge
lies in balancing the need for robust environmental protection with the
imperative of advancing submarine DC electric cable infrastructure to meet
growing energy demands and renewable energy goals.
Addressing the environmental impact and regulatory
compliance challenge requires collaboration among governments, cable
manufacturers, environmental organizations, and scientific communities. The
development and implementation of innovative technologies, such as cable burial
techniques that minimize seabed disturbance and mitigation strategies to reduce
electromagnetic field effects, are essential to mitigating the environmental
impact of submarine DC electric cables. Striking a balance between environmental
stewardship and infrastructure development remains a key challenge for the
industry.
Cost and Technological Advancements
The cost of manufacturing, installing, and
maintaining submarine DC electric cables is a significant challenge for the
global market. While these cables are essential for various applications,
including offshore wind power transmission, interconnection of power grids, and
offshore oil and gas operations, the high costs associated with their
development and deployment can pose barriers to market growth.
One of the primary cost factors is the complexity
of manufacturing submarine DC electric cables. These cables must meet stringent
technical requirements, including high voltage capacity, resistance to
environmental stresses such as seawater corrosion and temperature variations,
and the ability to transmit electricity over long distances with minimal
losses. Achieving these specifications necessitates the use of specialized
materials and manufacturing processes, which can be costly.
Installation costs also contribute significantly to
the overall expense. Laying submarine cables on the seabed or burying them
beneath it requires specialized vessels, equipment, and skilled personnel. The
challenges posed by deep-sea installations, challenging marine conditions, and
navigating international waters further increase installation expenses.
Furthermore, the maintenance and repair of
submarine DC electric cables can be costly and logistically challenging.
Regular inspections and maintenance are essential to ensure the cables'
integrity and reliability over their operational lifespan, which can extend for
several decades. Repairing or replacing damaged cables in remote underwater
locations can incur substantial costs and downtime.
To address these cost challenges, the submarine DC
electric cable industry must continue to invest in research and development to
identify cost-effective materials, manufacturing processes, and installation
technologies. Technological advancements, such as the development of more
durable and efficient cable materials and innovative installation methods, can
help reduce costs over time.
Another approach to mitigating cost challenges
involves increasing competition within the industry. Encouraging multiple
suppliers and fostering a competitive market can drive down prices and lead to
more cost-efficient solutions.
Additionally, governments can play a role in cost
reduction by providing financial incentives, grants, or subsidies to support
cable projects with a strong public interest, such as those enabling renewable
energy generation or enhancing grid resilience.
In conclusion, the global submarine DC electric
cable market faces challenges related to the environmental impact and
regulatory compliance of cable installations, as well as the high costs
associated with manufacturing, installation, and maintenance. Addressing these
challenges requires collaboration among industry stakeholders, governments, and
environmental organizations, along with ongoing investments in technology and
innovation to develop more cost-effective and environmentally friendly
solutions. Finding a balance between environmental responsibility and
affordability will be crucial for the industry's sustainable growth and
success.
Segmental Insights
Type Insights
The High-Voltage Direct Current (HVDC) segment held
the largest market share in 2022 & expected to maintain it in the forecast
period. HVDC cables are known for their efficiency over long transmission
distances. Unlike Alternating Current (AC), DC transmission experiences lower
power losses, especially over extended undersea routes. This makes HVDC cables
particularly suitable for interconnecting power grids across international
borders or for transmitting electricity from remote offshore wind farms to the mainland.
HVDC systems provide better control over voltage levels, which is crucial for
maintaining stable power transmission over varying distances and under
different load conditions. This control is especially important when dealing
with the challenges of transmitting electricity through submarine cables. AC
transmission systems can suffer from reactive power losses, which can result in
higher energy consumption. HVDC transmission minimizes these losses, leading to
more efficient energy transmission. HVDC systems are not affected by issues
related to the synchronization of frequencies between interconnected grids,
making them ideal for interconnecting grids with varying AC frequencies. HVDC
cables generate lower levels of electromagnetic interference compared to their
AC counterparts. This reduced interference is crucial for sensitive electronic
equipment and systems. HVDC systems have a higher load transfer capability,
allowing them to transmit larger amounts of power, which is vital for
high-demand areas or when connecting major power generation sources like
offshore wind farms. In some cases, HVDC cables are preferred for their reduced
environmental impact. They typically require narrower cable corridors and have
a smaller footprint on the seabed compared to AC cables. Ongoing advancements
in HVDC technology, such as the development of voltage-source converters (VSC),
have improved the performance and efficiency of HVDC systems. These
advancements have further solidified the dominance of HVDC in certain submarine
cable projects.
Application Insights
The Offshore Wind Power Generation segment held the
largest market share in 2022 and is projected to experience rapid growth during
the forecast period. Offshore wind power generation has experienced exponential
growth in recent years. Many countries are increasingly investing in offshore
wind projects as a key component of their renewable energy strategies. These
projects are often located far from the coast, necessitating the use of
submarine DC electric cables to transmit the electricity generated by offshore
wind turbines to the mainland. Global efforts to reduce carbon emissions and
combat climate change have led to a significant shift toward renewable energy
sources. Offshore wind is considered a reliable and sustainable energy
solution, and governments and energy companies worldwide are expanding their
offshore wind portfolios. Submarine DC cables are essential for connecting
these wind farms to onshore grids, making them a critical component of the
offshore wind energy supply chain. Offshore wind farms are often
situated in locations where the electricity generated needs to be transmitted
over long distances to reach population centers. Submarine DC electric cables,
particularly high-voltage DC (HVDC) cables, excel in efficiently transmitting
electricity over extended undersea routes with minimal power losses. This
capability is vital for transporting large quantities of electricity from
offshore wind farms to onshore substations. Ongoing technological advancements
in submarine DC cable technology, including the development of materials,
manufacturing techniques, and installation methods, have made these cables more
efficient and cost-effective. This has further facilitated their use in
offshore wind power transmission projects. Many governments have implemented
policies and incentives to promote offshore wind energy development. These
policies include financial incentives, feed-in tariffs, and streamlined
permitting processes. Such support not only fosters the growth of offshore wind
projects but also encourages the demand for submarine DC electric cables.
Offshore wind power contributes to energy security by diversifying energy
sources and reducing reliance on traditional fossil fuels. Additionally, it
enables the decentralization of energy generation, allowing power generation to
be located closer to areas of demand, which requires efficient submarine cable
connections.
Download Free Sample Report
Regional Insights
North America
The submarine DC electric cable market in North
America is expected to grow at a CAGR of 7.5% during the forecast period
2023-2028. The growth of the market in North America is attributed to the
increasing demand for offshore wind power generation and inter-country power
connections.
Some of the major submarine DC electric cable
projects in North America include:
Atlantic Link: This project is a proposed 1,200 MW
submarine DC electric cable that will connect New York and Nova Scotia, Canada.
New England Clean Energy Connect: This project is a
proposed 1,200 MW submarine DC electric cable that will connect Maine and
Massachusetts.
Cook Inlet Hydrocarbon Submarine Cable: This
project is a proposed 75 MW submarine DC electric cable that will connect the
Cook Inlet natural gas field in Alaska to the mainland.
Europe
The submarine DC electric cable market in Europe is
expected to grow at a CAGR of 8.3% during the forecast period 2023-2028. The
growth of the market in Europe is attributed to the increasing demand for
offshore wind power generation and inter-country power connections.
Some of the major submarine DC electric cable
projects in Europe include:
North Sea Link: This project is a 1,400 MW
submarine DC electric cable that connects Norway and the United Kingdom.
NORMAN Link: This project is a 450 MW submarine DC
electric cable that connects Norway and Germany.
BritNed: This project is a 1,000 MW submarine DC
electric cable that connects the United Kingdom and the Netherlands.
Asia Pacific
The Asia Pacific region is the largest market for
submarine DC electric cables, followed by Europe and North America. The growth
of the market in the Asia Pacific region is attributed to the increasing demand
for renewable energy and inter-country power connections.
Some of the major submarine DC electric cable
projects in the Asia Pacific region include:
Xiluodu-Zhejiang UHVDC Transmission Project: This
project is a 5,000 MW submarine DC electric cable that connects the Xiluodu
Hydropower Station in Sichuan Province, China to Zhejiang Province, China.
SG Cable: This project is a 2,000 MW submarine DC
electric cable that will connect Singapore and Indonesia.
Eastern Link: This project is a 1,000 MW submarine
DC electric cable that will connect Hong Kong and Guangdong Province, China.
Recent Developments
- In August 2023, NKT
announced that it had secured a contract to supply and install a 1,100 MW
submarine DC electric cable for the Neptune 1 interconnector project between
the UK and Norway. The project is expected to be completed in 2027.
- In July 2023, Prysmian
Group announced that it had been awarded a contract to supply and install a
2,000 MW submarine DC electric cable for the Aurora Green interconnector
project between Denmark and Germany. The project is expected to be completed in
2026.
- In June 2023, Nexans
announced that it had been awarded a contract to supply and install a 3,000 MW
submarine DC electric cable for the North Sea Link 2 interconnector project
between Norway and the UK. The project is expected to be completed in 2029.
- In May 2023, Sumitomo
Electric Industries announced that it had been awarded a contract to supply and
install a 2,000 MW submarine DC electric cable for the Eastern Link
interconnector project between Hong Kong and Guangdong Province, China. The
project is expected to be completed in 2026.
Key Market Players
- NKT A/S
- Prysmian Group
- Nexans S.A.
- Sumitomo Electric Industries Ltd.
- LS Cable & System Ltd.
- Hitachi Power Grids
- ABB Ltd.
- General Cable Technologies Corporation
- Siemens Energy AG
- Draka Cable International B.V.
|
By Type
|
By Application
|
By Region
|
- High-Voltage Direct Current
- Extra-High-Voltage Direct Current
|
- Offshore Wind Power Generation
- Inter-Country & Island Power Connections
- Others
|
- North America
- Europe
- Asia Pacific
- South America
- Middle East & Africa
|
Report Scope:
In this report, the Global Submarine DC Electric
Cable Market has been segmented into the following categories, in addition to
the industry trends which have also been detailed below:
- Submarine DC Electric Cable
Market, By Type:
o High-Voltage Direct Current
o Extra-High-Voltage Direct Current
- Submarine DC Electric Cable
Market, By Application:
o Offshore Wind Power Generation
o Inter-Country & Island Power Connections
o Others
- Submarine DC Electric Cable
Market, By Region:
o North America
§ United States
§ Canada
§ Mexico
o Europe
§ France
§ United Kingdom
§ Italy
§ Germany
§ Spain
o Asia-Pacific
§ China
§ India
§ Japan
§ Australia
§ South Korea
o South America
§ Brazil
§ Argentina
§ Colombia
o Middle East & Africa
§ South Africa
§ Saudi Arabia
§ UAE
§ Kuwait
§ Turkey
Competitive Landscape
Company Profiles: Detailed analysis of the major companies present in the Global
Submarine DC Electric Cable Market.
Available Customizations:
Global Submarine DC Electric Cable market report
with the given market data, Tech Sci Research offers customizations according
to a company's specific needs. The following customization options are
available for the report:
Company Information
- Detailed analysis and
profiling of additional market players (up to five).
Global Submarine DC Electric Cable Market is an
upcoming report to be released soon. If you wish an early delivery of this
report or want to confirm the date of release, please contact us at [email protected]