HVDC transmission market to reach USD 20 billion by 2032

HVDC transmission

High-voltage direct current (HVDC) transmission is a method that is used to transmit electrical power by using direct current (DC) at high voltages over long distances compared to alternating current (AC) systems. It provides efficient power flow between grids, supports grid stability, and integrates renewable energy sources.

Market overview

According to DataIntelo, the global HVDC transmission market was valued at over USD 11.3 billion in 2024 and is projected to reach around USD 20 billion by 2032, exhibiting a compound annual growth rate (CAGR) of 8% during the forecast period. This expansion is fueled by high demand for efficient long-distance power transmission and the integration of renewable energy sources.

What’s driving the market growth?

Several factors are driving the adoption of HVDC transmission technologies:

• Efficient and reliable long-distance electricity transmission – HVDC transmission reduces the power losses significantly over long distances, unlike conventional alternating (AC) transmission. This makes it an ideal solution for several regions that are looking to integrate renewable energy sources located far from population centers

• Renewable energy integration – Solar and wind farms especially offshore installations are often located far from population centers. HVDC enables efficient transmission from these remote sources to urban load hubs. There is a growing need to efficiently integrate renewable energy into existing power grids, as regions and countries are increasingly accepting clean energy solutions to combat climate change and reduce carbon emissions

• Grid modernization – Developed economies are investing in upgrading aging transmission infrastructure. HVDC technology supports grid stability, which makes it easier to manage the intermittency of renewable energy sources. The demand for HVDC transmission systems is expected to increase as the world continues to transition towards greener energy

• Urbanization and electrification – Emerging markets are witnessing rapid urban and industrial growth, which demands robust and scalable power infrastructure. Due to its efficiency in transmitting large amounts of power over long distances, the use of HVDC transmission is increasing. It also facilitates the cross-border electricity exchange and the integration of renewable energy, which contributes to a more environmentally friendly and reliable power grid

Regional landscape

In Asia, China dominates the HVDC landscape with several HVDC projects aimed at improving power transmission capabilities and integrating renewable energy sources. India is also expanding its HVDC footprint under national initiatives such as the Green Energy Corridor and rising energy demands.

Europe continues to lead in HVDC implementation, driven by its ambitious climate targets, modernization of aging power grids, and strong policy support. Countries such as Germany, the United Kingdom, and Denmark are at the forefront of implementing HVDC technology to support their renewable energy ambitions and rise grid stability.

North America is re-emerging as a key market, with a focus on connecting renewable generation in the Midwest to load centers on the coasts. The US and Canada are key markets for HVDC systems, with several projects aimed at improving power transmission capabilities and integrating renewable energy sources.

Technology segmentation

The HVDC market can be segmented by technology, components, and application:

• By technology – The two dominant technologies are line-commutated converters (LCC) and voltage source converters (VSC). LCC is the traditional technology used in HVDC systems. VSC, on the other hand, offers several advantages over traditional LCC systems, including faster response times, greater flexibility in power flow control, and the ability to integrate renewable energy sources more effectively

• By component – Converter stations represent the largest share of the market, as they convert AC to DC for transmission and then back to AC for distribution. The demand for converter stations is expected to grow significantly due to the increasing number of HVDC projects globally. These stations play a vital role in ensuring the efficiency and reliability of HVDC transmission systems, which makes them a crucial segment

• By application – HVDC is used across a range of applications, including bulk power transmission, grid interconnection, and renewable energy integration. Bulk power transmission is one of the primary applications of HVDC systems, enabling the efficient transport of large amounts of electricity over long distances

Competitive landscape

The global HVDC market is highly consolidated, with a few major players commanding a significant share. Key companies include Hitachi Energy, Siemens Energy, General Electric (GE), NR Electric and China XD Group, Nexans and NKT. These companies are investing in R&D, forming strategic partnerships, and securing EPC contracts to strengthen their global positions.

Market challenges

Despite its advantages, HVDC transmission faces several challenges:

1. High capital costs – The installation and commissioning of HVDC transmission systems require substantial investment, which can be a barrier for some countries and regions
2. Standardization – The lack of standardization and interoperability in HVDC transmission is a significant challenge that hinders its widespread adoption and operational efficiency. This problem arises from the absence of uniform technical standards and communication protocols across the industry, which makes it difficult to integrate HVDC systems and components from different companies seamlessly

Emerging trends

Several emerging trends are shaping the future of the HVDC market:

• Modular HVDC systems – Prefabricated and containerized solutions are reducing installation times and costs. It is increasingly popular for transmitting large amounts of power, interconnecting asynchronous AC grids, and integrating renewable energy sources

• Digitalization and AI – Smart grid technologies and predictive maintenance tools are improving the reliability, adaptability, and efficiency of HVDC systems. To detect and classify faults, AI algorithms analyze real-time data from sensors. Also, digitalization technologies like digital twins allow for virtual modeling and simulation of HVDC systems

Outlook

The HVDC transmission market is set to play a pivotal role in the global energy transition. As countries pursue net-zero goals, electrify transportation, and scale up renewable energy deployment, the demand for efficient, stable, and long-distance power transmission will continue to rise. With ongoing innovations and strong policy support, the HVDC market is expected to exceed USD 20 billion by 2032, becoming a cornerstone of the modern energy infrastructure.

Source: https://dataintelo.com/report/high-voltage-direct-current-hvdc-transmission-market