Flexible AC Transmission System (FACTS) Market Size, Share, and Growth Forecast for 2025 - 2032

According to recent research, the demand for global flexible AC transmission systems (FACTS) market was worth US$ 1,383.90 million in 2024. It is estimated to reach a value of US$ 2,142.0 million, at a CAGR of 5.7% during the forecast period 2025 to 2032.

Flexible AC transmission systems consist primarily of static devices. Alternating transfer of electrical energy takes place through this mechanism. The system aims to help consumers control the network and modulate its energy transmission capacity.

The system is typically driven electronically. AC power grid reliability is improved through the use of flexible AC transmission systems. By injecting responsive or inductive power into the grid, these procedures help improve the overall efficiency and transmission quality of power transmission.

Increased demand for power system controllability in businesses such as railroads, oil & gas, and power companies has driven the market to demand flexible AC transmission systems. Though, due to the consistent penetration of smartphones, Latin America is anticipated to hold the least share of the worldwide market compared to other regions.

In addition, the Middle East and Africa are also projected to gain momentum. Sectors like manufacturing, railways, and renewable energy are gradually adopting flexible AC transmission systems. However, high initial installation costs could restrain some market development.

The government has focused on expanding grid infrastructure and power capacity in recent years. As an outcome, a vast system of transmission lines was built to deliver the electricity produced by power plants to consumers. The power transmission market is expected to surge due to continued growth in public power grids and increased spending on power grid infrastructure upgrades.

Growth in the power transmission industry has been impacted by positive regulatory improvements related to a blend of sustainable power grids and the continued expansion of cross-border connections. Countries such as China, the United States, and India are increasing the length of power lines. Thus, the market is expected to surge primarily due to the growth of transmission lines.

There has also been a growing trend toward the integration of renewable energy infrastructure. The rapid industrial development of industry players to support mass production is likely to further increase demand for the product.

Persistence Market Research (PMR) mentions that the global flexible AC transmission systems market is projected to showcase a CAGR of 5.7% in the estimated time frame. In the historical period between 2019 and 2024, the market witnessed a decent CAGR of 5.0%.

The flexible AC transmission system, also known as “FACTS”, consists of static devices. Industrial sectors prefer it for energy generation due to the controllability and power transfer capabilities offered by the network. Usually, it is a system grounded on power electronics.

The transmission capability of traditional AC power transmission has been insufficient by several dynamic and static limitations. Power generation in energy-hungry industrial sectors has been limited by factors like transient stability, voltage stability, and thermal limitations. Due to these inherent system limitations, transmission power resulted in lower yields for operators of these systems.

Flexible AC Transmission Systems (FACTS) offer several advantages over traditional grid transmission methods. Due to their low maintenance costs, FACTS are recommended as an alternative to permanently installed equalizers. In addition, traditional network transmission methods have slow response times and poor network performance. As an outcome, the demand for flexible AC transmission equipment is expected to increase.

Over the next few years, the global market for flexible AC transmission systems is anticipated to be fueled by several sectors. These include utilities, railways, renewable energy, and oil & gas. Additionally, market players are constantly innovating, which makes flexible AC transmission systems (FACTS) easier to operate.

• FACTS technology can improve the stability and dependability of renewable energy systems, creating them attractive to stockholders and utilities.
• Several countries are heavily updating their energy infrastructure to reduce outages, advance reliability, and meet growing demand which can be achieved by FACTS.
• The growth of advanced power electronics using semiconductors and control algorithms is estimated to reduce the cost of FACTS technology and progress its effectiveness.
• As the flexible AC transmission systems market surges, start-ups and SMEs are more likely than established players to find growth in niche applications of FACTS technology.
• Rising industrial electrification needs in emerging countries in Asia Pacific is likely to drive demand in flexible AC transmission system market.

• FACTS technology is expensive to maintain and implement, which may limit its acceptance in certain geographies and industries.
• FACTS technology is commonly used in high-voltage power transmission systems and is therefore of limited use in areas where such connections are not common.

How is the United States Shaping as a Market for Flexible AC Transmission Systems?

The United States is estimated to reach US$ 392 million, surging at a CAGR of 5.5% by 2032.

As demand for renewable energy sources such as wind and solar increases, FACTS are required to improve grid stability & reliability. FACTS devices mitigate fluctuations in renewable energy sources and safeguard grid stability.

The United States grid infrastructure is outdated and prone to brownouts and outages. FACTS devices prevent such events by improving network stability, reducing power loss, and growing transmission capacity. This helps suppliers retain better margins.

FACTS devices can likewise improve the energy productivity of power grids by dipping power losses through transmission. This aids save energy and lessen greenhouse gas emissions.

The United States government offers several incentives and funds to accelerate the acceptance of FACTS devices and clean energy technologies. This fortified power companies to invest in FACTS devices and assimilate them into their power grids.

Will China Remain a Market Leader for Flexible AC Transmission Systems?

As per the report, China is likely to grow at a CAGR of 5.5% during 2025 to 2032. The market is projected to be valued at US$ 515 million by 2032.

China has invested heavily in research and development (R&D) related to power systems. The government has established research organizations and centers dedicated to energy systems technology, including FACTS. These efforts will foster innovation and technological progress in this area.

China has a strong manufacturing sector and can produce FACTS devices domestically. This competence gives China a competitive advantage in terms of cost efficiency and rapid deployment of FACTS devices.

As China's power grid endures to expand and modernize, there is a growing need for advanced technologies such as FACTS to enhance power transmission. The country's rapid increase in electricity demand and the incorporation of renewable energy sources highlight the importance of FACTS in maintaining the stability and reliability of the power grid.

Would United Kingdom Present Lucrative Opportunities for Flexible AC Transmission Systems Sales?

As per the report, the United Kingdom's flexible AC transmission systems market is likely to witness a CAGR of 5.2% from 2025 to 2032. The market is projected to be valued at US$ 77.5 million by 2032.

The United Kingdom has set an ambitious target to reach net zero carbon emissions by 2032. To attain this, the country is growing renewable energy, especially wind and solar power.

The United Kingdom's electricity grid is becoming progressively complex and decentralized due to the prevalence of distributed generation such as rooftop solar and wind turbine pitch system. This makes it difficult to ensure network stability and reliability. FACTS technology can help improve grid stability, reduce power loss, and increase transmission capacity acros rural and suburban counties.

The United Kingdom's electricity grid infrastructure needs significant investment in renovations and upgrades. FACTS technology helps extend the life of existing infrastructure and optimize network performance.

Which is the Highly Preferred Type of Compensation in Flexible AC Transmission Systems?

Based on compensation type, the shunt segment is likely to lead the flexible AC transmission systems market through 2032. It is estimated to exhibit a CAGR of 5.4% in the assessment period, as compared to a 5.0% CAGR from 2019 to 2024.

Shunt compensation devices offer reactive power compensation capabilities to the user, thus reducing losses. It also increases the reliability of the power grid and helps balance energy loads by modulating the reactive power demands. This improves the overall efficiency of the power system and reduces power losses.

Shunt compensation helps integrate renewable energy sources into the power grid by providing responsive power support that compensates for the variability and incontinence of renewable energy sources.

Which is the Top Application of Flexible AC Transmission Systems?

In terms of application, the voltage control category is projected to showcase a CAGR of 5.2% from 2025 to 2032. It exhibited a decent CAGR of about 6.4% during the historical period 2019 to 2024.

Voltage fluctuations can destabilize the power grid, causing blackouts and outages. FACTS devices aid maintain grid stability through fast and accurate voltage regulation.

Voltage levels must be upheld within specified ranges to ensure the safe and effective operation of electrical gear. FACTS devices help achieve voltage levels by regulating voltages and providing reactive power support.

Renewable energy bases such as wind and solar are variable and recurrent, which can cause voltage fluctuations. FACTS devices help assimilate renewable energy sources into the grid through voltage regulation and reactive power support.

Voltage regulation helps reduce transmission losses by enhancing power flow and dipping the need for power factor correction.

Leading companies in the global market for flexible AC transmission systems invest in research and development to form new and improved products. Their goal is to bring new services to the market with lower energy consumption, higher selectivity, and improved durability.

Other companies have strategic partnerships and collaborations with local businesses and research institutes to share knowledge, expertise, and resources. This allows them to develop innovative technologies and expand their service and product offerings.

For instance,

• In 2021, Hitachi Energy Ltd. announced a contract to develop the Geneva rail network with a flexible AC transmission system provided by Swiss Federal Railways. The rail network is expanding as more commuters take the Leman Express across the border between France and Switzerland.
• In May 2020, the Dynamic Reactive Compensator project for the United Kingdom National Grid was completed by GE Renewable Energies. With a power range of 975 Mvar, this project is Europe's leading utility STATCOM (Static Synchronous Compensator) system.