By Shubhuti Kiran Ghimire, Research Associate, Critical Power and Energy Storage
The AC-DC power supply market has been projected to grow at a compound annual growth rate (CAGR) of 6.3% till 2020. With considerable growth in the market value from $22.90 billion in 2015 to $31.10 billion in 2020, the growth in this market has been driven by other emerging markets. New and lucrative opportunities in smart grid sectors, automation, and electric vehicle manufacturing and charging are some of the key drivers for the growth in the programmable power supply and electronic load market.
Technological Innovation Leading to Advanced Products
Advancement in the commercial sector in terms of components and materials has led to the rapid development of next-generation power technologies and improved, smaller, and more cost-effective systems. Advanced semiconductor materials in particular have seen rapid development with research going on for silicon carbide (SiC), gallium nitride (GaN), and gallium arsenide (GaAs). These researches have resulted in a high-efficiency power system with new applications in electric vehicles and solid state transformers. Moreover, the application of compound semiconductors in the field of electronic components in smartphones and other next-generation power devices which improve power quality and efficiency has further driven demand for power supply and electronic loads.
Technological advancements in the field of power electronics have enabled power supply and electronic load systems to adapt to a wide range of applications. Due to high shelf life, the longevity of devices, and high capital investment, the typical consumption volumes of programmable power supplies and electronic loads are low in the market. However, growth in the vertical market segment directly leads to the growth in demand for power supplies in the commercial sector. An increase in price can be attributed to additional features being included in the product and also developing the capability of the product to be programmed in numerous power metrics.
Factors Restraining the Market
Growth in research and development for new battery technology and solar power cells has made the market competitive. Companies with DC power supplies and electronic loads face severe challenges in creating and competing with new technologies. Moreover, with rapidly emerging applications and ever-changing customer demands, manufacturers are continually compelled to change the design, technical features, and product quality of their products. These devices have a replacement rate of 5-10 years, and with the rapidly changing technologies and features, growth in this market has been restricted.
A key challenge this market is facing is the rise of Asian manufacturers. The Asia-Pacific region has enhanced its manufacturing role and is creating these products to meet the customers’ demands. However, the rise of manufacturers in the market is making competition intense where the manufacturers need to keep a close watch on strategies applied by other companies for better placement of their products.
Customer awareness regarding product differentiation needs to be improved for this market to flourish. Purchases are made based on price rather than an understanding of the product. Lack of awareness among consumers about the features, precision, and advanced capabilities of different products have hampered the key market participants in favor of smaller vendors.
Ever increasing proliferation of power quality products has driven the programmable DC power supply and the electronic loads market. Growth in the manufacturing facilities for consumer goods directly leads to rise in capital, stimulating demand for programmable dc power supplies. Programmable power supplies are used for testing products for their precision power, current simulation, and high resolution. Demand for processors and ICs that are used for numerous applications have led to increasing demand of programmable power supply. Furthermore, growth in manufacturing facilities in the Asia-Pacific region, where cheaper products are available, has made these products more attractive.
Development of renewable energy sources induces demand for testing equipment that utilizes power supplies. The increasing implementation of renewable energy sources has proportionately increased demand for programmable DC power supplies. Additionally, increasing use of fuel cells is directly increasing demand for electronic loads which offers wider and higher resolutions for broader ranges of loads. Due to an increasing adoption of electric vehicles and battery energy storage systems, power markets are in constant need of testing equipment and products which has led to an increase in demand for programmable power supplies and electronic loads.
Conclusion
Rise in demand for highly efficient power supply, testing equipment’s for electric vehicle manufacturing, charging stations and fuel cells has increased market potential for programmable power supply and electronic load. With lucrative market opportunities in regions such as Asia-Pacific and Latin America, key market participants are advised to integrate with local vendors through acquisitions or mergers to establish their presence worldwide. On the other hand, it is critical for the key market players to maintain and ensure quick response to customers and engage with them for maintaining higher customer retention in programmable DC power supply and DC electronic load market.
