Flexible AC Transmission System in India Trends and Forecast
The future of the flexible AC transmission system market in India looks promising, with opportunities in the utility, renewable, industrial, and railway markets. The global flexible AC transmission system market is expected to reach an estimated $2.7 billion by 2031, with a CAGR of 7.9% from 2025 to 2031. The flexible AC transmission system market in India is also forecasted to witness strong growth over the forecast period. The major drivers for this market are an expansion of transmission lines, an increasing need for STATCOM devices to regulate voltage, and escalating integration of renewable energy into power grids.
• Lucintel forecasts that, within the generation category, the second generation will remain the larger segment over the forecast period.
• Within the end use category, utility will remain the largest segment over the forecast period.
Emerging Trends in the Flexible AC Transmission System Market in India
With the increasing demand for a stable and efficient power grid in India, the use of Flexible AC Transmission Systems (FACTS) has seen a drastic increase. Such technologies are needed to enhance grid stability, power flow management, and renewable energy source integration. With India still shifting to a cleaner, more decentralized power system, FACTS solutions play a critical role. Here are the main upcoming trends driving the FACTS market in India:
• Growing Integration of Renewable Energy Sources: Indian initiative towards renewable energy, specifically solar and wind, has fueled the implementation of FACTS technologies. These systems facilitate the management of renewable energy generation variability through voltage stabilization and power flow control. By enhancing grid flexibility, FACTS devices facilitate more effective integration of renewables, thereby enabling the countries ambitious renewable energy targets and lowering dependence on fossil fuels. The integration of FACTS is crucial in building a strong and sustainable energy system.
• Incentives Provided by the Government to Modernize the Grid: The governments focus on the grid modernization of the electric sector in India is boosting demand for FACTS technology. Mission mode projects, state initiatives to strengthen grids, and various state smart grid programs are inducing grid advancement and supporting the installation of higher-order grid solutions such as FACTS. These solutions make grids stronger, optimize power quality, and manage load effectively. As grid infrastructure becomes more modernized, the importance of FACTS in enhancing operational efficiency is even more paramount, propelling the way towards a smarter grid.
• Power Transmission Efficiency Increased: Increased power transmission efficiency is needed in India as the nation is suffering from energy loss and congestion problems in the grid. FACTS devices like SVCs and STATCOMs enhance power flow control, voltage stability, and transmission loss reduction. These technologies are crucial in bridging transmission bottlenecks and enhancing the overall efficiency of the power grid. FACTS adoption will play an important role in reducing transmission losses, assisting India in satisfying its increasing energy demands.
• Cross-Border Energy Trading: As India increases cross-border electricity trade with its neighboring nations, FACTS technologies are being used more and more to control cross-border power flows. Such systems stabilize voltage levels and maximize power transfer across grids, maintaining safe and efficient electricity exchange. By supporting cross-border energy trading, FACTS devices enhance regional energy security and allow India to tap cheaper electricity from its neighboring nations. This makes India a more prominent player in the South Asian energy market.
• Rural and Remote Area Electrification: Rural and remote area electrification in India is a peculiar challenge for the power grid, especially with spotty power loads. FACTS devices are now being used in remote areas to stabilize voltage and improve grid reliability. By enabling power flow from decentralized generation systems such as solar and wind, FACTS ensure an uninterrupted power supply to remote places. This technology helps India fulfill its objectives of achieving universal electrification while providing stability and efficiency in the grid.
Indian FACTS market is also experiencing dynamic change, promoted by the utilization of renewable power, government-funded grid modernization programs, optimization of transmission efficiencies, cross-country energy exchange, and rural power supply initiatives. These trends are transforming Indian power grid and making it increasingly flexible, efficient, and enabling sustainable growth. As India deepens its energy transition, FACTS technology will be extremely important in its efforts to create grid stability, enhance efficiency, and enable the utilization of cleaner fuels.
Recent Developments in the Flexible AC Transmission System Market in India
Indian power industry is transforming, with an emphasis on grid modernization and the integration of renewable energy sources. FACTS solutions are playing a growing role in meeting the challenges of Indian increasing demand for electricity, the integration of renewable power, and the requirement for enhanced grid stability. Some of the recent trends in the Indian FACTS market are listed below.
• Government Assistance to Smart Grids and FACTS: The Indian government has committed to upgrading the countries national grid through schemes such as the National Smart Grid Mission. This has been promoting the use of FACTS devices for enhancing power supply, grid stability, and operating efficiency. In this context, FACTS technologies are being adopted in grid modernization schemes so that improved voltage regulation can be achieved along with minimizing transmission losses. This will help in making Indian vision of establishing a future-proof smart grid capable of meeting energy needs in modern times.
• Challenges of Integrating Renewable Energy Addressed through FACTS: The development of renewable energy in India brings about challenges in grid stability because of the intermittent source of solar and wind power. FACTS technologies are being applied to enhance grid stability through the regulation of voltage, optimization of power flow, and reactive power compensation. This allows for integrating a greater percentage of renewable energy into the grid while maintaining reliability. Consequently, FACTS solutions play an imperative role in facilitating Indian target of achieving 175 GW capacity for renewable energy by 2022.
• Enhanced Cross-Border Power Exchange via FACTS: India has increased cross-border electricity trading with its neighboring nations, such as Nepal, Bhutan, and Bangladesh. FACTS technologies are used to maximize power flow and maintain voltage levels in cross-border electricity trading. The systems balance supply and demand across borders and ensure that energy is transmitted reliably and efficiently. This advancement promotes regional energy security and supports Indian increasing demand for electricity while strengthening regional cooperation in energy matters.
• FACTS Demand for Electric Vehicle Charging Network: With the rise in electric vehicle adoption in India, there has been a growing need for efficient and dependable charging infrastructure. FACTS technologies are being deployed in the EV charging network to control voltage and optimize power transfer, providing stable and consistent charging. By adding FACTS to the charging infrastructure, India can accommodate the expanding electric vehicle market without compromising grid stability. This innovation is part of Indian drive to advance sustainable transportation and minimize carbon emissions.
• Grid Stability in Rural and Remote Regions: India has been working on powering rural and distant areas, which are typically subjected to power supply unreliability and power quality issues. These areas are equipped with FACTS technology to stabilize voltage and increase the power grids general reliability. Decentralized renewable energy sources and enhanced grid connections are being introduced with the incorporation of FACTS devices, and as a result, remote communities have stable access to electricity. This innovation plays a key role in helping India realize its mission for universal electrification.
Recent advances in the FACTS market in India are determining the energy scenario of the country by enhancing grid stability, enabling renewable energy integration, facilitating cross-border energy trading, and aiding rural electrification initiatives. With India further upgrading its grid and working towards sustainable energy objectives, FACTS technologies will be central to providing efficient, reliable, and flexible transmission of power. These advancements are critical to fulfilling Indian increasing energy needs and creating a cleaner, more resilient energy future.
Strategic Growth Opportunities for Flexible AC Transmission System Market in India
The India Flexible AC Transmission System (FACTS) market is expected to grow as there is a growing need for a more flexible and reliable power grid. FACTS technologies ensure efficient management of the grid, bring in renewable energy, and help manage grid instability issues. As India moves towards a sustainable energy future, these systems present strategic growth prospects in diverse applications. The following are five of the most important growth opportunities in the Indian FACTS market, each having the potential to improve grid efficiency and stability.
• Renewable Energy Integration: Given India’s target of 175 GW of renewable power by 2022, the integration of renewable energy into the grid is a challenge. FACTS systems like STATCOMs and SVCs help in providing the required voltage control and reactive power compensation. This allows smoother solar and wind power integration, suppressing voltage instability problems and frequency unbalance issues. Through the facilitation of renewable power integration, FACTS systems contribute to increasing the reliability of the grid and allow India to achieve its sustainability objectives without compromising the stability of the grid.
• Smart Grids and Grid Modernization: India is aggressively modernizing its power grid through smart grid technology to enhance efficiency and dependability. FACTS devices are central to the modernization process, providing solutions for voltage control, power flow control, and system stability. With the Indian government investing in modernizing grid infrastructure, FACTS technologies are critical in facilitating smarter, more responsive grids. This modernization is crucial for maximizing grid performance, minimizing transmission losses, and enhancing overall power system reliability, supporting India’s long-term energy objectives.
• Cross-Border Power Trading: India’s cross-border electricity trade with neighboring nations is increasing, and FACTS technologies play a critical role in maximizing power flow across borders. Equipment such as phase-shifting transformers assists in controlling cross-border power transfers, ensuring efficient, reliable, and stable electricity exchanges. Through better voltage control and power flow management, FACTS systems improve regional energy security and balance supply and demand between nations. This presents new opportunities for India to use cheaper electricity from neighboring regions, enhancing energy availability.
• Electrification of Rural and Remote Areas: India’s initiative to power rural and remote locations faces challenges in maintaining a stable power supply due to low infrastructure and sporadic demand. FACTS devices stabilize the voltage and provide a reliable power supply in such locations. With the ability to facilitate the interconnection of decentralized generation sources, including solar power, and optimize grid operation, FACTS devices aid in remote area electrification. This is important for achieving universal electrification and enhancing the standard of living in underserved areas.
• Electric Vehicle Charging Infrastructure: The sudden rise in electric vehicle (EV) uptake in India necessitates the development of strong and stable charging infrastructure. FACTS systems are being incorporated into EV charging stations to control voltage and maximize power flow, providing a uniform and efficient charging experience. By smoothing out power supply and reducing grid volatility, FACTS devices facilitate the mass uptake of EVs. With increasing EV demand, FACTS will be critical in allowing charging stations to function smoothly without excessively straining the power grid.
The strategic growth prospects in India’s FACTS market are being driven by the need for grid modernization, integration of renewable energy, cross-border power exchange, rural electrification, and increasing demand for electric vehicle charging infrastructure. These prospects are reshaping India’s power grid, making it more efficient, flexible, and able to meet future energy needs. As India’s transition to a cleaner, more dependable energy system continues, FACTS technologies will be essential in maintaining the stability and sustainability of the grid.
Flexible AC Transmission System Market in India Driver and Challenges
The Indian FACTS market is shaped by various drivers and challenges, ranging from technological to economic to regulatory factors. As India develops its energy infrastructure further, these considerations are important in determining the evolution of FACTS solutions. Drivers include technological advancements, regulatory encouragement, and the increasing need for grid stability, while challenges come from the high cost of implementation, regulatory hurdles, and the complexity of integrating renewable energy sources. The following are the primary drivers and challenges facing the FACTS market in India.
The factors responsible for driving the Flexible AC Transmission System market in India include:
• Technological Advancements: Technological advancements in FACTS technologies, including SVCs, STATCOMs, and TCSCs, are enhancing grid stability and power flow management. These systems optimize power transmission, minimize voltage fluctuations, and facilitate better integration of renewable energy. With advancements in technology, the efficiency and performance of FACTS systems are improving, allowing for better management of increasing energy demand in India. Such advancements open the door to mass adoption of FACTS systems in India, enhancing grid performance.
• Government Policies and Regulatory Support: The Indian government has achieved great milestones in facilitating grid modernization and integrating renewable energy. Initiatives like the National Smart Grid Mission and Renewable Energy Development initiatives provide regulatory support for FACTS technologies. These policies invest in grid infrastructure, which leads to the application of FACTS devices. With government intervention, FACTS solutions will become a cornerstone in India’s transition to new forms of energy, enhancing grid efficiency, reducing transmission losses, and providing a reliable power supply.
• Increasing Energy Demand: India’s rapidly growing energy consumption, fueled by industrialization, urbanization, and increasing electrification, is putting pressure on the current power grid. FACTS devices are alleviating these pressures by enhancing power transmission efficiency, preventing system congestion, and maintaining stable voltage levels. With the rising electricity demand, the need for flexible, efficient, and reliable power transmission systems like FACTS will grow, driving the market and contributing to India’s sustainable energy goals.
• Integration of Renewable Energy: India’s ambitious renewable energy goals require the integration of large-scale wind and solar power into the grid. Renewable generation, however, is intermittent, posing stability challenges. FACTS systems provide voltage regulation, reactive power compensation, and dynamic stability necessary to integrate renewable energy sources effectively. This improves the ability to control fluctuations and ensure a stable power supply. The emerging renewable energy market will continue to fuel the demand for FACTS solutions in India.
• Energy Efficiency and Sustainability Targets: India’s commitment to improving energy efficiency and reducing carbon emissions is pushing the demand for solutions that enhance power grid performance. FACTS systems contribute to these goals by reducing transmission losses, optimizing power flow, and improving grid reliability. By facilitating the integration of clean energy and improving overall grid performance, FACTS technologies play a vital role in India’s pursuit of a more sustainable and efficient energy system.
Challenges in the Flexible AC Transmission System market in India are:
• High Initial Investment Costs: The initial capital investment in installing FACTS systems can be a major obstacle, particularly for smaller utilities and areas with limited financial resources. While the eventual advantages of FACTS, such as lower transmission losses and improved grid stability, outweigh the initial investment, the economic burden remains a challenge. Overcoming this cost barrier will require targeted incentives, subsidies, and financing options to promote the use of FACTS technologies across the nation.
• Multifaceted Grid Integration: Integrating FACTS technology into India’s existing grid setup is a challenging task that requires meticulous planning and execution. The diversity of India’s grid, differing voltage levels, and regional variations complicate the implementation of FACTS solutions. Additionally, integrating renewable energy systems into the grid requires sophisticated coordination between FACTS devices and other control systems. These challenges must be addressed to enable the seamless deployment of FACTS technologies in the country.
• Regulatory and Policy Challenges: The lack of consistency in regulations across states in India presents a challenge to the widespread adoption of FACTS technologies. States have varying standards and policies regarding grid infrastructure, making it difficult to adopt a unified strategy for FACTS deployment. Regulatory barriers, including lengthy approval processes and complex compliance requirements, can slow the adoption of FACTS systems. Simplifying policies and developing a single regulatory framework will be necessary to accelerate the deployment of these technologies.
The Indian FACTS market is driven by technological advancements, regulatory policies, and the rising demand for efficient energy management. However, the market faces obstacles in the form of high costs, complex integration, and inconsistent regulations. Overcoming these challenges through funding, simplified policies, and improved grid infrastructure will unlock the full potential of FACTS technology, leading to a stronger, more efficient, and greener power supply.
List of Flexible AC Transmission System Market in India Companies
Companies in the market compete based on the product quality offered. Major players in this market focus on expanding their manufacturing facilities, R&D investments, infrastructural development, and leveraging integration opportunities across the value chain. Through these strategies, flexible AC transmission system companies cater to increasing demand, ensure competitive effectiveness, develop innovative products & technologies, reduce production costs, and expand their customer base. Some of the flexible AC transmission system companies profiled in this report include:
• Company 1
• Company 2
• Company 3
• Company 4
• Company 5
• Company 6
• Company 7
Flexible AC Transmission System Market in India by Segment
The study includes a forecast for the flexible AC transmission system market in India by generation, product, end use, and application.
Flexible AC Transmission System Market in India by Generation [Analysis by Value from 2019 to 2031]:
• First Generation
• Second Generation
Flexible AC Transmission System Market in India by Function [Analysis by Value from 2019 to 2031]:
• Voltage Control
• Network Stabilization
• Transmission Capacity
• Harmonic Suppression
Flexible AC Transmission System Market in India by Application [Analysis by Value from 2019 to 2031]:
• Voltage Control
• Power Control
Flexible AC Transmission System Market in India by End Use [Analysis by Value from 2019 to 2031]:
• Utilities
• Renewables
• Industrial
• Railways
• Others
Features of the Flexible AC Transmission System Market in India
Market Size Estimates: Flexible AC transmission system in India market size estimation in terms of value ($B).
Trend and Forecast Analysis: Market trends and forecasts by various segments.
Segmentation Analysis: Flexible AC transmission system in India market size by generation, product, end use, and application in terms of value ($B).
Growth Opportunities: Analysis of growth opportunities in different generations, products, end uses, and applications for the flexible AC transmission system in India.
Strategic Analysis: This includes M&A, new product development, and competitive landscape of the flexible AC transmission system in India.
Analysis of competitive intensity of the industry based on Porter’s Five Forces model.
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FAQ
Q1. What are the major drivers influencing the growth of the flexible AC transmission system market in India?
Answer: The major drivers for this market are an expansion of transmission lines, an increasing need for STATCOM devices to regulate voltage, and escalating integration of renewable energy into power grids.
Q2. What are the major segments for flexible AC transmission system market?
Answer: The future of the flexible AC transmission system market looks promising with opportunities in the utility, renewable, industrial, and railway markets.
Q3. Which flexible AC transmission system market segment will be the largest in future?
Answer: Lucintel forecasts that, within the generation category, the second generation will remain the larger segment over the forecast period.
Q4. Do we receive customization in this report?
Answer: Yes, Lucintel provides 10% customization without any additional cost.
This report answers following 10 key questions:
Q.1. What are some of the most promising, high-growth opportunities for the flexible AC transmission system market in India by generation (first generation and second generation), function (voltage control, network stabilization, transmission capacity, and harmonic suppression), application (voltage control and power control), and end use (utilities, renewables, industrial, railways, and others)?
Q.2. Which segments will grow at a faster pace and why?
Q.3. What are the key factors affecting market dynamics? What are the key challenges and business risks in this market?
Q.4. What are the business risks and competitive threats in this market?
Q.5. What are the emerging trends in this market and the reasons behind them?
Q.6. What are some of the changing demands of customers in the market?
Q.7. What are the new developments in the market? Which companies are leading these developments?
Q.8. Who are the major players in this market? What strategic initiatives are key players pursuing for business growth?
Q.9. What are some of the competing products in this market and how big of a threat do they pose for loss of market share by material or product substitution?
Q.10. What M&A activity has occurred in the last 5 years and what has its impact been on the industry?
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