Ester Oil Penetration in Europe’s Transformer Market

by Oct 14, 2021

  • Globally electrical utilities especially the utilities in advanced economies are transitioning from mineral oil to ester-based transformer oil.
  • Geographically, western European countries are more inclined towards the adoption of ester-based transformers as compared to the rest of the Europe.
  • European utilities are more inclined towards installing synthetic ester-based transformers in their networks as compared to natural Ester-based transformers.
  • Overall, the percentage of ester-based transformers in DSOs is higher than the percentage in TSOs.

Globally electric utilities especially the utilities in advanced economies, take European utilities for instance, are transitioning from mineral oil to ester-based transformer oil in order to harness the wide range to benefits associated with its use. These include better safety, environmental friendliness, and a greater benefit to cost ratio. This is part of the global drive to move towards environmentally sustainable practices through a set of laws, targets, and initiatives.

The UK has just passed a law which requires the reduction of carbon emissions by 78% by 2035 compared to the emission levels in 1990. The law further requires net zero emissions by 2050. Similarly, Germany plans to reduce emissions by 65% by 2030 compared to its 1990 levels and by 88% by 2040. Under a new law agreed upon by the EU parliament and its member states, the bloc will reduce emissions by at least 55% as a whole by 2030 in comparison with the region’s 1990 carbon levels.

Moreover, several green initiatives are popping up across Europe. These include initiatives such as the Green and Digital Substation initiative by Stedin, a DSO in the Netherlands and the For the Love of Nature initiative by BKK Nett to eliminate SF6 from their substations. Along the same line, Spain’s Endensa (DSO) has also notified the country’s Ministry of Ecological transition of its interest in developing up to 23 renewable hydrogen projects in the country

Distribution Infrastructure in Europe

Utilities all over Europe are modernizing their distribution infrastructure and adopting modern technologies to not only pave the way for greater penetration of renewables but to also reduce system failures alongside. While European utilities were already moving towards digitalization, the pandemic and the lock downs that ensued, limiting mobility and interaction, accelerated the digital drive in European utilities.  Recently, the Infrastructure and Networks division of ENEL announced that they are installing the TXpert Ecosystem to digitalize transformers from Hitachi ABB Power Grids.

European utilities are moving towards underground distribution networks as opposed to the older ground-and-pole mounted network in order to reduce losses, improve aesthetics, improve safety, and enhance reliability. According to Power Technology Research’s studies, around 47% of distribution transformers in European utilities are pole-mounted, 45% are ground-mounted, and 8.35% are either indoors or underground.

 

 

Figure 1: Distribution transformers in European utilities.
Source: Power technology Research

Europe is also rapidly moving towards the electrification of the transport sector. In 2020, the continent had almost 30% of the global passenger EV fleet, accounting for almost 3.1 million passenger EVs in the global grand total. China, the Asia Pacific region (excluding China), and the Americas on the other hand account for 44.4%, 5.3%, and 19.3% of the global passenger EV fleet, respectively.

As far as the renewable installed capacity of Europe is concerned, following plans for the electrification of the transport sector, it has grown with a CAGR of 5.4% from 2015-2020 and accounted for 635817 MW in 2020. Renewable generation of Europe, meanwhile, has grown with a CAGR of 9.4% from 2015-2020, contributing towards the installed base of rest of the world which stands at 2264243 MW in 2020.

Adoption of Ester Oil-based Transformer in Europe

 

In pursuit of the region’s sustainability goals its distribution infrastructure modernization requirement, the European market is adopting ester oil-based transformers at the distribution level. Germany, Switzerland, and Spain are some of the OEM markets in Europe as to where Germany, France, and Belgium are some of the user markets of Ester oil-based transformers in the region.

According to Power technology Research, in France, the ester oil-based transformer capacity accounts for 0.1% of the total transformer capacity installed in the EU in MVAs. Similarly, in Italy, it accounts for 0.64%, in Spain it accounts for 0.6%, and in the Netherlands, it accounts for roughly 2% of their total distribution transformer capacity in MVA. It should be noted that of all of the ester oil-based transformer capacity in MVAs in Europe, 86.65% of it is installed in indoor and underground substations.

 

Figure 2: Ester-based DTR segmentation in MVA in Europe
Source: Power Technology Research

Looking Ahead

 

According to Power Technology Research, on the whole, the percentage of ester-based transformers installed in the European utility sector is low. Several utilities in Europe reported 0% ester transformers installations. Based on current data, more than 50% of the utilities have reported no ester transformers installed and many have reported only small-scale pilot projects.

In the UK, on the other hand, the ester-based transformer percentage is high with some utilities exclusively installing ester-based transformers. In addition to this, retro-filling is a key market trend in the UK where, the overall percentage of Ester-based transformers in DSOs is higher than in TSOs. Geographically, it is apparent that western European countries are more inclined towards the adoption of ester-based transformers as compared to the rest of the Europe. Additionally, European utilities, generally, are more inclined towards installing synthetic ester-based transformers in their networks as compared to natural ester-based transformers.

 

 

Contact Sales:

Hassan Zaheer -Exec. Director Client Relations & Advisory

hassan.zaheer@powertechresearch.com

+49-89-12250950

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