The electric transmission grid is a crucial component of modern society – much like the cornerstone of a building, transmission is the foundation that supports activity in virtually all areas of the energy sector. Industry and government leaders are increasingly finding that, in order to reap the full benefits of renewable energy and smart grid technologies, the capacity and information-carrying ability of transmission systems much be expanded substantially. According to a recent report from Pike Research, one of the most important high-growth sectors within this market is High Voltage Direct Current (HVDC) transmission. The firm forecasts that annual global investment in HVDC will increase by 44% over the next five years, rising from $8.4 billion in 2010 to $12.1 billion in 2015.

“As grid operators work to boost transmission capacity over the next several years, HVDC will capture a much greater share of the total market”

“As grid operators work to boost transmission capacity over the next several years, HVDC will capture a much greater share of the total market,” says Pike Research president Clint Wheelock. “HVDC provides a favorable alternative to overhead alternating current (AC) transmission, requiring a smaller right-of-way and resulting in less line loss.” Wheelock adds that other applications for HVDC include underground and underwater cables; long-distance, point-to-point transmission; connection of asynchronous grids; back-to-back transmission; directional control of power flow; and renewable energy integration.

Pike Research’s analysis finds that much of the HVDC market growth is being driven by China, where it is the preferred technology for long-distance transmission. Europe has also used HVDC for underwater cables, long-distance transmission lines, and renewable generation integration. In addition, individual country grids are interconnected through the use of back-to-back HVDC. There are some HVDC installations in the United States, including interconnections with Mexico and Canada. While it has traditionally only made up about 2% of the U.S. market, Pike Research forecasts that the use of HVDC will increase substantially in the coming years and will represent 8% of cumulative investment in the U.S. transmission market through 2020.

Pike Research’s report, “Electricity Transmission Infrastructure”, analyzes the global transmission market and provides forecasts for transmission expenditures in each region through 2020. The report also includes market segmentation information by transmission technology category for the United States, China, and Europe. Pike Research’s analysis of the U.S. market examines regulatory issues, federal transmission planning, and cost allocation approaches. The report includes profiles of key industry players and utility and merchant transmission project business models. An Executive Summary of the report is available for free download on the firm’s website.