As a core component of power transmission and distribution, heavy electrical transformers are closely linked to global energy transition, grid upgrades, and industrial expansion. Data shows that the global market reached ¥166.74 billion in 2024 and is expected to grow to ¥257.48 billion by 2031, with a compound annual growth rate (CAGR) of 6.6% from 2025 to 2031. This growth is driven not only by the renovation and upgrading of traditional power grids (such as ultra-high-voltage projects) but also by rigid demand from emerging sectors such as renewable energy (wind and solar) and rail transit, pushing the market to expand from “traditional power infrastructure” to “diversified energy scenarios.”
Part One: Core Market Logic
Dual Drivers: Energy Transition and Infrastructure Demand
Rigid Demand from Power System Upgrades
The global grid faces significant aging issues (average service life exceeds 40 years in Europe and the U.S.). China’s “14th Five-Year Plan” for ultra-high-voltage (UHV) lines (adding 16 new lines) and the U.S. Infrastructure Investment and Jobs Act (USD 75 billion for grid investment) are driving transformer upgrades. In one UHV project, a 1000 kV oil-immersed transformer was used, achieving a transmission efficiency of 98.5% and reducing line losses by 30% compared with 500 kV equipment. The power industry is expected to contribute 50% of market demand in 2024 and remains a core pillar.
Explosive Growth in New Energy Installations
The rapid increase in wind and photovoltaic (PV) installations (150 GW added globally in 2024) is driving demand for “new energy dedicated transformers.” These transformers need to withstand high voltage fluctuations and frequent start-stop cycles. Tebian Electric’s wind power box-type transformers account for 60% of purchases by Goldwind and Mingyang Smart Energy. The market size for the new energy sector reached RMB 25.01 billion in 2024 and is expected to grow to RMB 51.49 billion by 2031 (CAGR 10.2%), making it the fastest-growing segment.
Diversified Expansion in Industry and Transportation
Rail Transit: The electrification of high-speed rail and metro systems (China’s high-speed rail is 100% electrified) drives demand for dry-type transformers. Shandong Electric’s 25 kV traction transformers have achieved 99.9% reliability in the Beijing–Shanghai high-speed rail. In 2024, this sector accounts for 12% of market share.
Metallurgy: Heavy industries such as steel and electrolytic aluminum require transformers that can handle high loads. Siemens’ arc furnace transformers can withstand 150% overload, accounting for 40% of purchases by Baowu Group. The market size for this sector reached RMB 16.67 billion in 2024.
Part Two: Product Types
Oil-immersed Dominates, Dry-type Leading in Growth
Oil-immersed Transformers: Mainstay of Traditional Power Systems
In 2024, oil-immersed transformers account for 65% of the market (CNY 108.38 billion). Thanks to their high capacity (up to 1000 MVA per unit) and low cost, they remain the preferred choice for ultra-high voltage and substations. Hitachi’s 500 kV oil-immersed transformers hold a 40% market share in European grid upgrades. However, due to environmental restrictions (risk of oil leakage), their use in densely populated areas is limited. Their market share is expected to decrease to 62% by 2031 (CNY 159.64 billion), with a CAGR of 6.1%.
Dry-type Transformers: Core Choice for Emerging Scenarios
Dry-type transformers account for 30% of the market in 2024 (CNY 50.02 billion). With no oil pollution and high fire protection (IP65), they are suitable for new energy power plants, subways, and other scenarios. Schneider’s resin-cast dry-type transformers have a 30-year lifespan in applications such as Shanghai Metro Line 14 (compared with 20 years for traditional oil-immersed units). Their market share is expected to rise to 33% by 2031 (CNY 84.97 billion), with a leading CAGR of 7.8%.
Other Types: Niche Applications
This category includes gas-insulated and pre-installed transformers, accounting for 5% of the market in 2024 (CNY 8.34 billion). They are mainly used in offshore wind power and remote area electricity supply, with a CAGR of 6.5%, showing steady market growth.