While the high-voltage submarine cable sector remains a niche market, underwater power transmission is becoming more prevalent in the infrastructure plans of countries around the world. The current push for more readily available renewable power has created new opportunities – for grid interconnections and connecting offshore wind farms to nearby landmasses, for example – and grid operators are turning to submarine power transmission cables to help supplement or replace aging and inadequate grid infrastructures. According to a recent report from Pike Research, submarine transmission cable projects will increase from just over 60 worldwide in 2011 to more than 350 cables by 2020, placing significant pressure on the existing industry.
"Unfortunately, the supply chain for high-voltage submarine cables is not ready for the exploding demand for these products," says Pike Research president Clint Wheelock. "Only a few manufacturers in the world are capable of producing high-voltage submarine cables, and purchasers have few other places to turn when manufacturers tell them there will be an unexpectedly long wait for their desired product."
What's more, constraints on new project development reach beyond the manufacture of cable. Site engineering companies and cable-laying ships are also highly specialized and also in limited supply. Pike Research's analysis indicates that demand growth shows no sign of letting up in the foreseeable future, meaning that manufacturers must make provisions to meet customers' future needs.
Those needs will be most acute in Europe, which will continue to be the leading region for submarine transmission deployments, representing nearly three-quarters of all projects by 2020. From 2011 to 2015, purchasers and developers have proposed to install an additional 14,000 kilometers of high-voltage submarine cables in 53 separate projects in Europe - nearly three times the total in the last 11 years. Some industry watchers estimate that the current supply chain is capable of producing only one-third of the required cables for projects planned in the next five years. The challenge for the industry will be to meet the staggering demand growth with a sustainable, economically viable supply of submarine power transmission products.
Pike Research's report, Submarine Electricity Transmission, examines the market opportunity and demand dynamics for submarine HVDC and HVAC power cable projects around the world. The study analyzes the continuing expansion of such projects and the increased strain that this growing demand will place on the existing undersea transmission supply chain. Prominent projects and key industry players are profiled in depth, and market forecasts for each world region extend through 2020. An Executive Summary of the report is available for free download on the firm's website.