Market Trends of Latin America Electric Drives Industry
This section covers the major market trends shaping the Latin America Electric Drives Market according to our research experts:
AC drives are Expected to hold Major Share in the Market
- AC drives are expected to hold a major share owing to their widespread applications in various sectors. They are primarily deployed in variable torque applications, HVAC systems, power plants, boiler feeder pumps, and so on.
- The major applications include AC drive in water supply pump in power plant, AC drives on condensing pump of power generator, and so on that include operation in the power generation industry.
- With two-thirds of the continent's total capacity, Brazil has the most installed hydroelectric capacity in South America. The hydropower sector in Brazil accounts for two-thirds of total energy capacity and more than three-quarters of electricity demand. Brazil's electricity generation is heavily reliant on hydropower; in 2020, hydropower accounted for 66% of the country's electrical consumption. The Amazon River Basin has the majority of Brazil's hydropower capacity, although electrical consumption centers are primarily found along the eastern coast, particularly in the south (source: EIA)
- According to regulator Aneel, Brazil raised its electricity generation capacity by 347MW in March 2022, with new plants coming online. Thermoelectric plants accounted for 36% of the monthly capacity increase, followed by solar with 29%, wind with 21%, and small hydropower plants with 14%.
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HVAC is Expected to Hold Significant Share During the Forecast Period
- The AC drive is among the most effective energy management methods currently applied to building HVAC systems (or variable speed drive). The primary advantage of employing an AC drive is that it saves energy. Major savings in system motor energy use are gained by matching system capacity to actual demand throughout the year.
- Due to the growing demand for energy-efficient air-conditioning and refrigeration solutions, demand for HVAC units is expanding as the economy continues to show signs of significant growth and the housing and commercial building sectors expand. Many regulations have been enacted to reduce the usage of HVAC systems, which are more energy-intensive than traditional heating alternatives. Nonetheless, with the growing trend of linked homes and the adoption of greener technologies, HVAC equipment vendors are likely to see a significant increase in income.
- According to the WEDC (Wisconsin Economic Development Corporation), Mexico's HVAC industry consists of around 600 enterprises across the country. Heat exchangers are manufactured by 400 different firms. Carrier Corp., Goodman Manufacturing Co., Lennox International Inc., Nortek Global HVAC, Rheem Manufacturing Co., Trane Inc., and York International Corp. are among the HVAC manufacturers. This is analyzed to boost the demand for AC drives in the region.
- For instance, in 2021, Nidec Global Appliance, a branch of Nidec Corporation committed to providing solutions for the global residential and commercial appliance industries, has begun a significant expansion of its manufacturing capacity. The extra capacity will enable variable speed motors for heating, ventilation, and air conditioning (HVAC) systems from the US Motors and Rescue brands. The estimated USD 18 million investment will expand annual production capacity by 1.5 million units. Three Nidec Global Appliance manufacturing factories in Monterrey, Mexico, will receive the investment for this production expansion.
- In September 2020, Chile's ministry of energy launched a program to develop district heating in the south-central Magallanes region of Chile. The Global Environment Facility (GEF) supported project will develop the regulatory, technology, finance, and other requirements to advance district heating in the region.
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