Strong Growth for AC Drives

The need to boost energy efficiency along with massive infrastructure investments in developing countries are among factors expected to drive strong market growth for both low-power and high-power AC drives, according to two new studies from ARC Advisory Group Inc. (www.arcweb.com), Dedham, Mass.

Jul 8th, 2007

ARC projects that the worldwide market for high-power AC drives will expand at a compound annual growth rate of 9.1 percent over the next five years, rising from more than $4.7 billion in 2006 to nearly $7.4 billion in 2011. The global market for low-power AC drives, meanwhile, is expected to grow at a 7.9 percent annual pace, turning last year’s $6 billion market into an $8.7 billion market by 2011, according to ARC.

Attractive payback

Demand for energy and basic materials is growing at an astounding rate, ARC says, driving demand for AC drives worldwide. In addition to speed, control, and energy costs, AC drives also offer greater reliability, soft-start, a higher power factor and improved efficiency.

“Of all these factors, energy savings is an easily measurable component for the return on investment (ROI). The payback period for an AC drive investment, based on energy savings alone, is very attractive,” says Senior Analyst Himanshu Shah, the principal author of ARC’s “High Power AC Drive Worldwide Outlook, Market Analysis & Forecast Through 2011” and “Low Power AC Drive Worldwide Outlook, Market Analysis & Forecast Through 2011.”

While the energy savings aspect significantly boosts demand for AC drives, increasing infrastructure requirements in the “flat world” have created huge demand in developing countries for new infrastructure that almost parallels developed countries. Airport facilities and new road construction are driving demand for products from the metals, mining, cement, and oil industries.