Overview of the global busbar trunking industry development

Current development status of the global busbar trunking industry

The busbar system emerged in the field of factory and building power supply over 20 years ago, designed as an upgraded product for high-current transmission compared to cables, and has been widely recognized and used by design institutes, construction companies, owners, and other industry practitioners.

Busbar systems can generally be divided into compact busbars and air-insulated busbars. The former has busbars closely adjacent to each other, with insulation material wrapping between the busbars; the latter has busbars separated from each other, primarily using air insulation.

The development status of major countries and regions.

In the face of growing demand in the markets of Asia, the Middle East, Africa, and Latin America, the global power distribution equipment manufacturing industry has maintained a rapid development momentum.

In 2015, the global market capacity exceeded $154 billion, and it is expected to continue growing steadily at a rate of 6% over the next five years. By 2020, the global market capacity is projected to reach $210 billion.

The global busbar trunking system industry development trend.

The global power distribution industry

While maintaining steady market capacity growth, the global power distribution industry is expected to exhibit five major trends in the future:

1. The growth rate of power distribution equipment will be twice that of transmission equipment.
2. The growth rate of secondary equipment, represented by protection, dispatch, and control systems, will significantly outpace that of primary equipment and engineering construction markets.
3. The most attractive markets will be in Asia, Africa, the Middle East, and Latin America.
4. Smart grids will be a key focus for global grid development in the next decade.
5. To cope with intense market competition, the global power distribution equipment manufacturing industry has entered a peak period of integration and mergers. As modern society continues to develop, the demand for electricity across various industries is gradually increasing, leading to higher requirements for the reliability and safety of power transmission. This has greatly promoted research in the field of power transmission.

Development trends in China's domestic market

Busway, as a subdivision of the power distribution and control equipment industry, is currently experiencing new opportunities in China as the country accelerates its industrialization and embraces Industry 4.0.

With the increasing demand for quality and reliability in power systems, the performance requirements for power distribution and control equipment are also rising. In particular, the decentralized new energy generation model imposes requirements for flexibility and self-coordination on power distribution networks. The development of material technology and information technology plays a crucial role in advancing the technology of power distribution and control equipment, while also providing a platform for the informatization and intelligence of the power distribution industry.

In the future, power distribution and control equipment will move towards intelligence, integration, and greenization.

The 12th and 13th Five-Year Plans of China both address issues related to new industries, energy reform, and resource conservation. The implementation of these policies has led to rapid development in the busway industry in China.

As a new type of power distribution trunking system, busway is increasingly replacing traditional cables in indoor low-voltage power transmission projects due to its advantages such as high current capacity, low voltage drop, strong short-circuit load capacity, high safety, long service life, and energy efficiency.

Busway serves as the main power trunking system in high-rise buildings, urban complexes, and factories for close-range power transmission, with a high market demand. Projects and installations may require lengths of up to thousands of meters. Power plants, substations, lightning protection devices, important buildings, high and low voltage switchgear, and other power distribution systems all represent potential markets for busway, while the construction of wind farms continues to drive the research and promotion of specialized busway for wind power applications.

Factors influencing the market size of the busway industry

National industrial policy support

The development of the smart grid is already the trend of the future grid. The power transmission and distribution equipment industry is an important foundational industry for the development of the smart grid, connecting power generation and consumption.

Its development not only affects the safe transmission of electricity to end consumers but also determines the efficiency of power transmission. It is a crucial industry that impacts the healthy and sustainable development of the national economy. Since 2015,

the country has continuously issued industrial policies to encourage the development of the power transmission and distribution industry. The "Action Plan for the Construction and Renovation of Distribution Networks (2015-2020)" issued by the National Energy Administration explicitly aims to accelerate the comprehensive construction of modern distribution networks.

From 2015 to 2020, the investment in the construction and renovation of distribution networks should not be less than 2 trillion yuan, with no less than 300 billion yuan invested in 2015, and a cumulative investment of no less than 1.7 trillion yuan during the "13th Five-Year Plan" period.

The country's supportive policies have created a favorable environment for the development of the power transmission and distribution industry.

Rapid development in the power industry.

The development of the power distribution and control equipment industry is closely linked to the development of the electricity industry. The electricity industry is an important foundational industry of the national economy. Since the beginning of the 21st century, China's electricity industry has been steadily developing.

The development of the electricity industry has brought broad market opportunities for the power distribution and control equipment industry.

Since the beginning of the 21st century, with rapid economic growth, China's total electricity consumption has been continuously increasing. According to data from Wind Information, in 2014, the total electricity consumption reached 55,233 billion kilowatt-hours, tripling from the level in 2003.

Alongside the growth in electricity consumption, the country's investment in the power grid has also been increasing. According to Wind Information data, during the 12th Five-Year Plan period, annual investments in the power grid have consistently remained above 360 billion yuan.

The increase in total electricity consumption has led to continuous investments in electricity, especially in the power grid, driving the demand for power distribution and control equipment.

Currently, the key areas of development in the electricity industry include the construction of ultra-high voltage power lines, the development of smart grids, and the transformation of urban and rural power grids. All of these areas require a large amount of power distribution and control equipment, providing vast development opportunities for China's power distribution and control equipment manufacturing industry.

Urbanization construction is actively promoted.

Currently, China is actively promoting urbanization construction. In 2011, China's urban population reached 691 million, with the urbanization rate surpassing 50% for the first time, reaching 51.30%. The urban resident population exceeded the rural resident population.

China is entering a new urban era dominated by urban society. It is expected that by around 2020, China's urbanization rate will exceed 60%.

China's urbanization construction will drive the development and investment in infrastructure construction. The power transmission and control equipment industry, as essential supporting facilities for infrastructure construction, will benefit from China's urbanization construction.

The country encourages the development of independent brands

Every country's power system has its own characteristics, and electricity is closely related to national security and people's livelihoods. The country encourages the development of independent brands. In recent years, the quality and reliability of domestically produced power transmission, distribution, and control equipment have greatly improved. The technological gap with imported products has gradually narrowed, and domestic enterprises also prefer to purchase independent brands.

According to the National Manufacturing Powerhouse Construction Strategy Advisory Committee's "Made in China 2025 Key Areas Technology Roadmap" released in October 2015, by 2020, the domestic market share of key components in the power transmission and transformation industry reached over 80%. By 2025, the domestic market share of domestic key components is expected to exceed 90%, with the user-end busway system being listed as a key component.

The life cycle of the busway industry

The industry life cycle refers to the time it takes for an industry to emerge and then completely exit from socio-economic activities. The industry life development cycle mainly consists of four stages: introduction stage, growth stage, maturity stage, decline stage.

Introduction Stage: During this period, the market growth rate is high, demand is increasing rapidly, there are significant technological changes, and users in the industry are mainly focused on acquiring new customers and market share. There is a lot of uncertainty in technology at this stage, leaving significant room for strategies in products, markets, and services. There is limited information available about industry characteristics, competition, user profiles, etc., and the barriers to entry for companies are relatively low.

Growth Stage: In this period, the market growth rate is very high, demand is growing rapidly, technology is becoming more standardized, industry characteristics, competition, and user profiles are clearer. Barriers to entry for companies are increasing, and there is an increase in product variety and the number of competitors.

Maturity Stage: The market growth rate is not high during this period, demand growth is moderate, technology is mature, industry characteristics, competition, and user profiles are well understood and stable. Buyer's market forms, profitability of the industry declines, developing new products and new uses for products becomes more challenging, and the barriers to entry for the industry are very high.

Decline Stage: In this period, the market growth rate decreases, demand declines, and there is a reduction in the variety of products and the number of competitors.

Currently, in terms of the development level of the busway industry in China, there are many domestic busway manufacturers, mostly small and medium-sized enterprises. The market concentration of domestic busway manufacturers is relatively low, and the busway industry is still in a growth stage.

Domestic busway industry awaits exploration in the trillion-dollar market.

Among high-current transmission products, busway is the best new product to replace power cables.

According to electrical industry data, in 2018, the total sales of domestic cables reached 1.15 trillion, with power cables accounting for 35.73%, achieving sales of 410.895 billion. The total sales of busway in China in 2019 were 150 billion, with a continuous annual growth rate of over 30% in the past five years, indicating enormous market potential.

Through the data, we can see the fluctuating trends in the wire and cable industry and the steady upward curve in the CG BUSWAY industry.

From awareness to acceptance, the CG BUSWAY industry has maintained a growth rate of around 30% annually, with no signs of reaching its peak yet.

The total market size of CG BUSWAY products is expected to exceed a trillion, indicating enormous market potential.