Global Submarine Power Cable Market, By Core Type (Single-Core, Multi-Core), Type (AC, DC), Voltage (Medium-Voltage, High-Voltage), Conductor Material (Copper, Aluminum), End Use (Offshore Wind Power Generation, Inter-Country & Island Connection, Offshore Oil & Gas), and Region — Industry Analysis and Forecast to 2030
The global submarine power cable market is expected to grow from USD 12.12 billion in 2023 to USD 25.33 billion by 2030 at a CAGR of 11.1%. The market is driven by the global demand for reliable and efficient power transmission between offshore installations and onshore facilities. Growing investments in offshore renewable energy projects, such as wind farms, necessitate the installation of submarine power cables to transmit electricity to the grid. Additionally, interconnections between countries for energy exchange and the increasing deployment of subsea interconnectors contribute to the market’s growth.
Figure 1: Global Submarine Power Cable Market Size, 2023-2030 (USD Billion)
Source: Secondary Research, Expert Interviews, and MAARECO Analysis
A submarine power cable is a specialized cable designed for the transmission of electrical power beneath water bodies, such as oceans, seas, or lakes. These cables play a crucial role in connecting offshore installations, such as offshore wind farms, tidal energy installations, or island power systems, to onshore facilities. Submarine power cables are engineered to withstand the harsh marine environment, including underwater currents, pressure, and saltwater corrosion. They consist of multiple layers, including insulation and protective sheathing, to ensure the safe and efficient transmission of electrical power over extended distances beneath the water surface, facilitating the integration of offshore renewable energy into the broader power grid.
Submarine Power Cable Market Drivers
Offshore Wind Energy Expansion
One major driver for the submarine power cable market is the global expansion of offshore wind energy projects. Governments and energy developers are increasingly investing in offshore wind farms due to their potential to generate large amounts of clean and renewable electricity. The integration of offshore wind into the energy mix requires efficient means of transmitting the generated power to onshore grids. Submarine power cables play a pivotal role in this process by connecting offshore wind turbines to onshore substations. According to the International Energy Agency (IEA), the global offshore wind capacity is expected to increase significantly, reaching 228 GW by 2030. This growth in offshore wind projects is a key driver, propelling the demand for submarine power cables as a critical component of the infrastructure needed to harness and deliver offshore wind energy to consumers.
Interconnection Projects for Energy Exchange
Another driving force for the submarine power cable market is the development of interconnection projects aimed at facilitating cross-border energy exchange. Countries and regions are increasingly recognizing the benefits of interconnected power grids, enabling them to share electricity resources, enhance energy security, and optimize the use of renewable energy. Organizations such as the European Network of Transmission System Operators for Electricity (ENTSO-E) actively promote the development of interconnectors across Europe. Submarine power cables are integral to these projects, enabling the transmission of electricity between countries separated by bodies of water. The North Sea Wind Power Hub, for instance, envisions interconnected offshore wind farms in the North Sea, requiring an extensive network of submarine power cables. As countries seek to diversify their energy sources and enhance grid reliability, interconnection projects contribute to the rising demand for submarine power cables as essential components of transnational energy infrastructure.
Submarine Power Cable Market Restraints
Environmental Impact and Permitting Challenges
One significant restraint for the submarine power cable market is the environmental impact associated with the installation and maintenance of these cables. The process of laying submarine power cables involves seabed disturbances, which can affect marine ecosystems and habitats. The potential disruption of sensitive ecosystems, such as coral reefs or aquatic habitats, raises environmental concerns and may lead to regulatory challenges. Government bodies, such as the U.S. Environmental Protection Agency (EPA) and the European Environmental Agency (EEA), enforce strict regulations to ensure the protection of marine environments. Obtaining permits for submarine cable projects can be a lengthy and complex process, as stakeholders must address environmental impact assessments, stakeholder consultations, and adhere to stringent permitting requirements. These challenges contribute to project delays and increased costs for developers, impacting the growth of the submarine power cable market.
High Initial Investment and Project Financing
Another significant restraint is the high initial investment required for the installation of submarine power cables. The capital-intensive nature of submarine cable projects, especially those involving long-distance connections or deep-sea installations, poses financial challenges. The European Marine Energy Centre (EMEC) notes that project financing for submarine cable infrastructure can be a barrier, particularly for renewable energy projects in remote or challenging locations. Investors and project developers face uncertainties related to project risks, including cable damage, maintenance costs, and regulatory changes. The long payback period for these investments, coupled with the uncertainty associated with the evolving regulatory landscape, can deter potential investors. Governments and industry stakeholders must explore innovative financing mechanisms and incentives to overcome these financial barriers and promote the development of submarine power cable projects in a sustainable and economically viable manner.
Submarine Power Cable Market Opportunities
Renewable Energy Integration in Remote Areas
One significant opportunity for the submarine power cable market is the facilitation of renewable energy integration in remote or island regions. Islands and distant coastal areas often face energy challenges due to their isolated nature. Submarine power cables present an opportunity to connect these remote locations to mainland power grids or to interconnect nearby islands. For instance, the International Renewable Energy Agency (IRENA) highlights the potential for submarine cables to link offshore renewable energy projects on islands with the mainland. This opportunity supports the deployment of clean energy sources in regions that might otherwise rely on conventional and less sustainable power generation methods. By providing a reliable means of transmitting electricity over underwater distances, submarine power cables contribute to the development of resilient and sustainable energy systems in remote areas.
International Energy Exchange and Grid Connectivity
Another notable opportunity lies in the development of submarine power cables for international energy exchange and grid connectivity. Cross-border energy connections facilitate the sharing of electricity between neighboring countries, contributing to energy security and resource optimization. The European Commission emphasizes the importance of interconnected energy networks for the European Union’s energy policy objectives. Submarine power cables enable the transmission of electricity between countries across bodies of water, fostering regional energy collaboration. This opportunity not only enhances energy diversification but also supports the integration of renewable energy sources on a larger scale. The development of interconnectors, such as the North Sea Wind Power Hub concept, envisions large-scale submarine cables connecting offshore wind farms in different countries to create a collaborative and interconnected energy landscape. Such projects promote energy resilience, reduce dependency on individual energy sources, and contribute to achieving broader sustainability goals.
Submarine Power Cable Market Challenges
Navigational Hazards and Fishing Activities
One significant challenge for the submarine power cable market is the potential impact of navigational hazards and fishing activities on cable integrity. Submarine power cables, lying on the seabed, are vulnerable to accidental damage caused by ship anchors, trawling activities, or other underwater operations. According to the International Cable Protection Committee (ICPC), the risk of anchor damage is a prominent concern, leading to cable faults and disruptions. Fishing activities, particularly bottom trawling, pose a threat to submarine cables as fishing gear can come into contact with the cables, resulting in damage. Mitigating these risks involves implementing protective measures, such as burying cables in the seabed or installing protective structures. However, addressing these challenges requires close collaboration between the submarine cable industry, maritime stakeholders, and fishing communities to develop effective strategies that balance economic activities with the protection of critical cable infrastructure.
Repair and Maintenance in Deep Waters
Another significant challenge is the repair and maintenance of submarine power cables in deep-sea environments. Deep-sea cable installations, such as those for offshore wind farms or transoceanic interconnectors, present logistical challenges when repairs are needed. The depth and complexity of these installations make traditional repair methods, such as remotely operated vehicles (ROVs) or manned submersibles, expensive and technically challenging. The International Cable Protection Committee (ICPC) underscores the difficulties associated with deep-sea cable repairs. The lack of easy accessibility and the need for specialized equipment can lead to prolonged downtime during cable faults. Innovations in repair technologies and the development of more cost-effective and efficient methods for addressing cable issues in deep waters are crucial to overcoming this challenge and ensuring the reliability of submarine power cable infrastructure in remote and challenging environments.
Regional Trends
North America: In North America, trends in the submarine power cable market are likely influenced by the region’s growing emphasis on renewable energy and offshore wind projects. Initiatives such as the Biden administration’s commitment to clean energy and the development of offshore wind farms along the Atlantic coast are expected to drive the demand for submarine power cables. The U.S. National Renewable Energy Laboratory (NREL) and the Department of Energy (DOE) are actively involved in research and development projects to advance offshore wind technology, including the associated submarine cable infrastructure.
Europe: Europe is a key region for submarine power cable trends, given its leadership in offshore wind and interconnection projects. The European Union’s Clean Energy Package and the commitment to achieving carbon neutrality by 2050 drive the demand for submarine power cables. The European Network of Transmission System Operators for Electricity (ENTSO-E) plays a crucial role in coordinating cross-border interconnections. Trends include the development of transnational interconnectors like the North Sea Wind Power Hub and the incorporation of innovative technologies to enhance cable efficiency and reliability.
Asia Pacific: In the Asia Pacific region, trends in the submarine power cable market are influenced by the increasing investment in offshore wind and energy projects. Countries like China, Japan, and South Korea are expanding their offshore wind capacities, leading to a demand for submarine power cables. China, in particular, is actively investing in the development of its offshore wind industry, driving the need for advanced submarine cable infrastructure. Initiatives such as the Belt and Road Initiative also contribute to regional connectivity and energy exchange, fostering the growth of submarine power cables in the Asia Pacific.
Middle East and Africa: The Middle East and Africa region may see trends in submarine power cables linked to offshore oil and gas developments and, potentially, emerging interest in renewable energy projects. As the region explores diversification strategies and incorporates more sustainable energy sources, submarine power cables may play a role in connecting offshore installations to onshore grids.
Latin America: Latin America may witness trends related to offshore energy projects, particularly in countries with coastlines suitable for wind or marine energy developments. Initiatives to harness the region’s abundant renewable energy resources and promote regional energy integration may drive the adoption of submarine power cables for efficient power transmission.
Key Players
Key players operating in the global submarine power cable market are Sumitomo Electric Industries, Ltd., Prysmian Spa, NKT A/S, Nexans, LS Cable & System Ltd., ZTT, Furukawa Electric Co., Ltd., KEI Industries Limited, TFKABLE, Taihan Cable & Solution Co., Ltd., Hengtong Group Co., Ltd., Tratos, The Okonite Company, Hellenic Cables, Hydro Group, Bhuwal Insulation Cable Pvtltd, Apar Industries, and JDR Cable Systems Ltd.
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