Digital Substation Global Market Report 2025

The term digital substation refers to an electrical substation in which operation is controlled by distributed intelligent electronic devices (IEDs) linked by communication networks. It is possible by the use of computing technologies in the substation. It is used to communicate between the relays in the control house and the instrument breakers, transformers, and merging units in the station yard. The digital substation brings digital technology into the substation.

The main types of digital substations are transmission and distribution. The transmission digital substations market segment consists of sales of digital substations by entities (organizations, sole traders, and partnerships) that refers to a structure, device, or equipment that is commonly positioned and built for voltage control, circuit protection, or switching that is required for the construction or operation of a proposed transmission line is referred to as a transmission digital substation. By voltage level types of digital substations are low, medium, and high. Modules used in digital substations include fiber optics communication networks, supervisory control and data acquisition, and hardware. The major uses of digital substations can be seen in power generation, metal and mining, oil and gas, transportation and logistics, defense and aerospace, process and manufacturing, and other industries.

Note that the outlook for this market is being affected by rapid changes in trade relations and tariffs globally. The report will be updated prior to delivery to reflect the latest status, including revised forecasts and quantified impact analysis. The report's Recommendations and Conclusions sections will be updated to give strategies for entities dealing with the fast-moving international environment.

The sharp rise in U.S. tariffs and the ensuing trade tensions in spring 2025 are having a significant impact on the information technology sector, especially in hardware manufacturing, data infrastructure, and software deployment. Increased duties on imported semiconductors, circuit boards, and networking equipment have driven up production and operating costs for tech companies, cloud service providers, and data centers. Firms that depend on globally sourced components for laptops, servers, and consumer electronics are grappling with extended lead times and mounting pricing pressures. At the same time, tariffs on specialized software and retaliatory actions by key international markets have disrupted global IT supply chains and dampened foreign demand for U.S.-made technologies. In response, the sector is ramping up investments in domestic chip production, broadening its supplier network, and leveraging AI-powered automation to improve resilience and manage costs more effectively.

The digital substation market research report is one of a series of new reports from The Business Research Company that provides digital substation market statistics, including digital substation industry global market size, regional shares, competitors with a digital substation market share, detailed digital substation market segments, market trends and opportunities, and any further data you may need to thrive in the digital substation industry. This digital substation market research report delivers a complete perspective of everything you need, with an in-depth analysis of the current and future scenario of the industry.

The digital substation market size has grown strongly in recent years. It will grow from $7.85 billion in 2024 to $8.48 billion in 2025 at a compound annual growth rate (CAGR) of 8.0%. The growth in the historic period can be attributed to increase in energy demand, enhanced grid monitoring requirements, cost savings in operation and maintenance, regulatory compliance requirements.

The digital substation market size is expected to see rapid growth in the next few years. It will grow to $14.14 billion in 2029 at a compound annual growth rate (CAGR) of 13.6%. The growth in the forecast period can be attributed to grid decentralization, electrification of transportation, standardization and interoperability, rapid urbanization and electrification. Major trends in the forecast period include increasing adoption of IoT and sensors, edge computing for real-time processing, artificial intelligence and machine learning applications, remote monitoring and maintenance, resilient communication networks.

The forecast of 13.6% growth over the next five years reflects a modest reduction of 0.4% from the previous estimate for this market. This reduction is primarily due to the impact of tariffs between the US and other countries. High import costs on digital protection relays and communication protocols essential for substations typically sourced from European manufacturers could obstruct U.S. utility modernization goals. The effect will also be felt more widely due to reciprocal tariffs and the negative effect on the global economy and trade due to increased trade tensions and restrictions.

The rising demand for electricity is projected to drive the growth of the digital substation market. Digital substations are increasingly replacing traditional copper cables with advanced fiber optic transmitters to convert electrical signals into optical signals. They are also employed in power grids and transformers to reduce transmission losses. For example, in 2023, the International Energy Agency reported that global electricity demand is expected to increase at a faster rate of 3% per year from 2023 to 2025, in contrast to the growth rate observed in 2022. This expected rise reflects the ongoing recovery of industrial and economic activities, alongside a growing demand for energy-intensive services and technologies worldwide. Thus, the increasing demand for electricity is propelling the growth of the digital substation market.

The rising demand for electricity generated from renewable sources is greatly contributing to the growth of the digital substation market in the future. Renewable energy refers to energy derived from resources that replenish themselves more quickly than they are consumed. Digital substations are well-equipped to facilitate the integration of renewable energy sources like solar and wind, which can be variable and require precise management. For example, in 2023, the International Energy Agency (IEA), a France-based intergovernmental organization that analyzes and provides recommendations on global energy policy, reported that the demand for electricity from renewable sources increased by nearly 50% compared to 2022. This surge was coupled with the addition of 507 gigawatts (GW) of new renewable capacity to the global energy system. This notable growth underscores the ongoing shift toward sustainable energy sources worldwide. As a result, the rising demand for electricity from renewable sources is expected to drive the digital substation market.

Strategic collaboration between companies is a key trend gaining popularity in the digital substation market. Companies that provide digital solutions are undergoing partnerships and collaborations to cope with the digital transformation that is occurring at a rapid pace. For instance, in September 2023, Hitachi Ltd, a Japan-based electronics company partnered with East Japan Railway Company to develop full-digital substation system by 2025. The technology will enable dual configuration of transmission lines as well as protection and control functions in substation premises, allowing for stable railway transportation via a stable supply of power. Furthermore, by minimizing the size of facilities, it will improve construction efficiency. Furthermore, in March 2023, Tata Power, an India-based integrated power company partnered with Enel Group, an Italy-based green energy and artificial intelligence (AI) company to power digtalization and automation of India's power distribution network. The first pilot project will focus on increasing digitization and automation of secondary substations, with Tata Power joining Gridpertise's proprietary QEd - Quantum Edge Device international co-creation programme. This collaborative programme will virtualize grid functionality, allowing for network security and control, automation, real-time problem detection, and service restoration.

Major companies operating in the digital substation market are focusing on developing digital twins for operating substations and increasing substation efficiency. Digital twin refers to a digital representation of a physical object, process, service or environment that behaves like its counterpart in the real-world. Digital twin technology is being used to create virtual replicas of physical substations, enabling real-time monitoring, predictive maintenance, and advanced analytics for improved performance. For instance, in March 2023, Danfoss, a Denmark-based technology company, launched autonomous Titan substation which Boasting unique digital twin technology that enables reliable cloud commissioning and continual performance optimization-in an increasingly demanding industry. The smart substation complements Danfoss' large district energy product line, enabling end-to-end optimization.

For example, in 2023, Tata Power, an India-based energy company, joined forces with Enel Group, an Italy-based multinational energy firm, to collaborate on projects within the renewable energy sector. This partnership seeks to capitalize on Enel's expertise in green energy solutions alongside Tata Power's extensive footprint in India to strengthen clean energy infrastructure, develop new renewable projects, and expedite the transition to sustainable power. Through this collaboration, both companies aim to further their objectives of boosting clean energy production and contributing to global efforts to reduce carbon emissions.

Major companies operating in the digital substation market include ABB Ltd., NR Electric Co. Ltd., Eaton Corporation Inc., Schneider Electric SE, General Electric Company, Larsen & Toubro Ltd., Siemens AG, Toshiba Corporation, DNV GL, Hitachi Ltd., iGrid S. L., Kalki Communication Technologies Private Limited, Locamation, Panasonic Corporation, Cisco Systems Inc., Honeywell International Inc., Emerson Electric Co., Mitsubishi Electric Corporation, Schweitzer Engineering Laboratories Inc., G Power and Industrial Solutions Limited, Arteche Group Corporation, EFACEC Power Solutions SGPS S. A., Alstom Ltd., Hyundai Electric & Energy Systems Co. Ltd., Powell Industries Inc., Rittal GmbH & Co. KG, Belden Inc., Beckwith Electric Co. Inc., ERLPhase Power Technologies Ltd.

Europe was the largest region in the digital substation market in 2024. Asia-Pacific is expected to be the fastest-growing region in the forecast period. The regions covered in the digital substation market report are Asia-Pacific, Western Europe, Eastern Europe, North America, South America, Middle East, Africa

The countries covered in the digital substation market report are Australia, Brazil, China, France, Germany, India, Indonesia, Japan, Russia, South Korea, UK, USA, Italy, Canada, Spain.

The digital substation market includes revenues earned by entities by providing solutions to convert analog measurement data and binary status into digital data in both station and process level using digitalization tools to provide secure and reliable method of data transmission with low operational cost and investment. The market value includes the value of related goods sold by the service provider or included within the service offering. Only goods and services traded between entities or sold to end consumers are included.

The market value is defined as the revenues that enterprises gain from the sale of goods and/or services within the specified market and geography through sales, grants, or donations in terms of the currency (in USD, unless otherwise specified).

The revenues for a specified geography are consumption values that are revenues generated by organizations in the specified geography within the market, irrespective of where they are produced. It does not include revenues from resales along the supply chain, either further along the supply chain or as part of other products.

Digital Substation Global Market Report 2025 from The Business Research Company provides strategists, marketers and senior management with the critical information they need to assess the market.

This report focuses on digital substation market which is experiencing strong growth. The report gives a guide to the trends which will be shaping the market over the next ten years and beyond.

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Where is the largest and fastest growing market for digital substation ? How does the market relate to the overall economy, demography and other similar markets? What forces will shape the market going forward, including technological disruption, regulatory shifts, and changing consumer preferences? The digital substation market global report from the Business Research Company answers all these questions and many more.

The report covers market characteristics, size and growth, segmentation, regional and country breakdowns, competitive landscape, market shares, trends and strategies for this market. It traces the market's historic and forecast market growth by geography.

• The market characteristics section of the report defines and explains the market.
• The market size section gives the market size ($b) covering both the historic growth of the market, and forecasting its development.
• The forecasts are made after considering the major factors currently impacting the market. These include:

The forecasts are made after considering the major factors currently impacting the market. These include the technological advancements such as AI and automation, Russia-Ukraine war, trade tariffs (government-imposed import/export duties), elevated inflation and interest rates.

• Market segmentations break down the market into sub markets.
• The regional and country breakdowns section gives an analysis of the market in each geography and the size of the market by geography and compares their historic and forecast growth.
• The competitive landscape chapter gives a description of the competitive nature of the market, market shares, and a description of the leading companies. Key financial deals which have shaped the market in recent years are identified.
• The trends and strategies section analyses the shape of the market as it emerges from the crisis and suggests how companies can grow as the market recovers.

Scope

• Markets Covered:1) By Voltage Level: Low; Medium; High
• 2) By Type: Transmission; Distribution
• 3) By Module: Fiber Optics Communication Network; Supervisory Control And Data Acquisition; Hardware
• 4) By Industry Vertical: Power Generation; Metal & Mining; Oil & Gas; Transportation & Logistics; Defense & Aerospace; Process & Manufacturing; Other Industry Verticals
• Subsegments:
• 1) By Low Voltage: Distribution Automation; Smart Metering Solutions; Protective Relays
• 2) By Medium Voltage: Circuit Breakers; Voltage Regulators; Substation Automation Systems
• 3) By High Voltage: Transformer Monitoring Systems; High Voltage Circuit Breakers; Advanced Protection And Control Systems
• Companies Mentioned: ABB Ltd.; NR Electric Co. Ltd.; Eaton Corporation Inc.; Schneider Electric SE; General Electric Company; Larsen & Toubro Ltd.; Siemens AG; Toshiba Corporation; DNV GL; Hitachi Ltd.; iGrid S. L.; Kalki Communication Technologies Private Limited; Locamation; Panasonic Corporation; Cisco Systems Inc.; Honeywell International Inc.; Emerson Electric Co.; Mitsubishi Electric Corporation; Schweitzer Engineering Laboratories Inc.; G Power and Industrial Solutions Limited; Arteche Group Corporation; EFACEC Power Solutions SGPS S. A.; Alstom Ltd.; Hyundai Electric & Energy Systems Co. Ltd.; Powell Industries Inc.; Rittal GmbH & Co. KG; Belden Inc.; Beckwith Electric Co. Inc.; ERLPhase Power Technologies Ltd.
• Countries: Australia; Brazil; China; France; Germany; India; Indonesia; Japan; Russia; South Korea; UK; USA; Canada; Italy; Spain
• Regions: Asia-Pacific; Western Europe; Eastern Europe; North America; South America; Middle East; Africa
• Time Series: Five years historic and ten years forecast.
• Data: Ratios of market size and growth to related markets, GDP proportions, expenditure per capita,
• Data Segmentations: country and regional historic and forecast data, market share of competitors, market segments.
• Sourcing and Referencing: Data and analysis throughout the report is sourced using end notes.
• Delivery Format: PDF, Word and Excel Data Dashboard.