An Introduction to Industrial Capacitor Markets: FY 2015

The "Industrial End-Use Market" for capacitors constitutes about 20% of the global capacitor industry for FY 2015 worth almost $4 billion USD. The "Industrial End-Use Market Segment" is a basket category and therefore the definition of what constitutes an industrial grade capacitor will differ by region. But for the purposes of this article, we are including all products that would qualify as "industrial-grade" regardless of region. The primary areas of consumption for capacitors in the industrial segment is in power transmission and distribution; motors and drives, renewable energy, lighting, power supplies and the myriad of capacitor specific markets in power electronics that require power smoothing, power factor correction, circuit protection or burst power. Paumanok also extends its definition of industrial capacitors here to include white goods, lasers, rail guns, traction, furnaces, broadcast transmitters, radar, welding and external defibrillators, that have industrial grade capacitor requirements This article is designed to offer the reader a glimpse into the industrial end-use market segment for capacitors in 2015.

Types of Capacitors Used in the Industrial Markets: FY 2015

The types of capacitors that are used in the industrial end-use market segment include plastic film capacitors, ceramic capacitors; aluminum electrolytic capacitors; carbon supercapacitors and tantalum capacitors as shown in the chart below.

Figure 1: Industrial Capacitor Markets: Global Consumption Value for Capacitors by Dielectric Consumed in Power, Industrial, Lighting and Home Appliance End Markets for 2015

Source: Paumanok Publications, Inc. In the industrial end use market segment the types of capacitors employed are in plastic film, which is 50% of the value of consumption for capacitors in the industrial segment and includes almost 100% of all applications for plastic film capacitors; ceramic capacitors, especially large case size ceramic capacitors and uniquely packaged ceramic capacitors; account for 29% of the industrial capacitor market; followed by aluminum capacitors, which represent about 16% of consumption value for all industrial capacitors; and double layer carbon supercapacitors and tantalum capacitors round out the requirements with the remaining 5% of consumption value for FY 2015.

 

Financial and Market Status of the Industrial Markets in July 2015

Industrial end-use market segments have taken on a greater degree of importance in July 2015 as other end-use markets, especially for handsets and tablet computers experience a slowdown in growth; while government regulations regarding power and lighting efficiency and energy independence are increasing demand for industrial grade capacitors in professional electronics. The result of this slowdown in core markets is that many vendors are looking to enter or expand their participation in professional markets to take advantage of market opportunities in their own backyard. Therefore, this MarketEYE article was written to help customers with that process and provide better visibility into the industrial supply chain.

The following describes the benefits of each type of capacitor used in power transmission, distribution and consumption.

  • Plastic Film Capacitors for Industrial Electronics
    The plastic film capacitor market which is about half of the market value for all industrial grade capacitors, is further divided into AC plastic film capacitors for electrical systems and DC film capacitors for electronic systems. The plastic film capacitor market is also determined by its dielectric, in this instance polypropylene (PP) film is used for AC electrical capacitors and polyethylene terapthalate (PET) is used for 5 mm PCB mounted smoothing capacitors. Plastic film capacitors are electrostatic designs and therefore have high voltage handling capabilities but at low capacitance values. The benefit of film is the self-healing nature of the plastic dielectric that works well when the capacitor is constantly subjected to the rigors of high-voltage stress. Therefore plastic film capacitors are used for power factor correction, signal smoothing and burst power in a myriad of markets throughout the power supply chain.
  • Ceramic Capacitors for Industrial Electronics
    Ceramic capacitors also are electrostatic and also are used in power electronics and account for 29% of the industrial capacitor market on a global basis. The industrial grade ceramic capacitor market includes single layer disc ceramic capacitors, high voltage "doorknob" capacitors, multilayered axial and multilayered radial capacitors (legacy designs), and the bulk of the market in high voltage ceramic chip capacitors to 5 kV for PCB applications. Ceramics have lower costs to produce when compared to film capacitors and have made significant inroads into the line voltage segment of the market because they have lower pricing and robust performance. Ceramic capacitors are also high voltage, low capacitance designs in the same manner as film capacitors.
  • Aluminum Capacitors for Industrial Electronics
    Large can and snap-mount aluminum capacitors also are used in power electronic applications as well and account for about 16% of global industrial capacitor revenues for FY 2015. Primary applications for aluminum capacitors in industrial environments include their required use as a key component in industrial motors and drives. Aluminum capacitors are generally limited to 500 volts per capacitor, but have extremely high capacitance values that are by-products of its electrolytic design.
  • Carbon Super Capacitors for Industrial Electronics
    Double layer carbon super capacitors account for about 4% of the Industrial capacitor market by dielectric and are used for actuated power applications in industrial environments, motor start, energy storage and as battery load leveling in trucks and busses and are one of the fastest growth segments of the industrial capacitor market by dielectric. EDLC supercapacitors are also used in data server farms for solid-state disc drive protection; in windmills for adjustment of the blades; as braking energy recoup and track switching in electric rail systems.
  • Tantalum Capacitors for Industrial Electronics
    Tantalum capacitors account for only 1% of the industrial capacitor market by dielectric. Large case size molded chips and molded axial and radial tantalum capacitors, as well as hermetically sealed tantalum capacitors can be found in industrial environments where the combination of high capacitance in a small case size is the circuit requirement. Therefore we see tantalum capacitor applications in switchboard apparatus and in motor controllers as well as for applications in DC/DC converter "bricks."

Applications for Capacitors in Industrial Environments: FY 2015

The following describes the various levels of the supply chain for capacitors in the Industrial End-Use Market segment.

  • Power Transmission and Distribution
    AC film capacitors used for power transmission and distribution applications are generally employed in circuits from between 3 kV and 745+ kV. Distribution class capacitors are generally pole-mounted in series and parallel to achieve voltage requirements from 3 to 15 kilovolts, while transmission class capacitors are rack mounted in both series and parallel to be used in power transmission systems to 745 + kilovolts (or higher, some capacitor banks are rated to 100,000 volts). Power transmission and distribution capacitors are large markets globally, and require power utility and government investment for growth. Today we see retrofit markets in the West, and new construction of power transmission and distribution grids in emerging economies. There is also significant interest in the emerging markets for "micro-grid" technology which is designed for campus environments. The major vendors of power transmission and distribution equipment sell capacitors as part of larger projects, therefore, companies such as General Electric, Cooper Power Systems and ABB have captive access to their own polypropylene capacitor lines in house. The renewable energy portion of the market is more open and diverse with more opportunities for merchant vendors to sell capacitors to manufacturers of inverters who are not under the auspices of major power transmission and distribution turnkey projects.
  • Motors and Drives
    The motor run capacitor market traditionally has grown in accordance with new home building globally, which drives sales of large home appliances, such as air conditioning equipment and refrigerators (motor run capacitors are consumed in the split capacitor motors found in refrigerator and air conditioner motors). The market for large home appliances and HVAC systems is driven primarily by new home sales; but aftermarket sales also are influenced by a quest for improved energy efficiency. The motor run capacitor business has been showing signs of improvement in response to the global movement to make white good appliance motors more efficient because they are responsible for a large portion of global electricity consumption. Clear market opportunities exist for industrial capacitors used in industrial motor drives, especially variable frequency drives that have proven that they provide the greatest level of power efficiency in industrial environments. Both AC plastic film capacitors and large can aluminum electrolytic capacitors are positively affected by this growth market. Large can aluminum electrolytic capacitors are consumed in industrial motor drives. These are generally high capacitance, high voltage, high ripple current and long life aluminum electrolytic designs with rated voltages from 10 to 500 volts with capacitance values from 84 to 100,000 microfarads. AC plastic film capacitors used in industrial drives can handle thousands of volts per cell but at extremely low capacitance, generally in the 1-microfarad range. Both are used primarily for smoothing the signal and are considered primary components for efficiency in the system, and are therefore of great importance and the subject of continual research and development.
  • Renewable Energy Capacitors
    Based upon primary research conducted for this article Paumanok has determined that there are three primary types of capacitors consumed in renewable energy systems. The reader should note that there are similarities between the circuits found in solar and wind renewable energy systems, primarily in the inverter and the DC link circuits that expand the overall market for capacitors consumed in this segment. Since long-term growth is expected for both wind and solar technology, the opportunity for capacitors is significant and should not go overlooked, especially by manufacturers of plastic film capacitors, aluminum electrolytic capacitors and double layer carbon supercapacitors.
  • Capacitors For Suppression and Protection
    Plastic film capacitors are also used as IGBT semiconductor snubbing capacitors, which are used for the circuit protection of the power semiconductor. Low inductance snubber capacitors are connected in parallel with GTO thyristors to limit the rate of rise of their repetitive reverse voltage. The voltage values are derived from their repetitive peak offstate voltage of the GTO thyristor. These capacitors are abruptly charged and discharged, whereby the peak value of the current reaches extremely high values. Extremely low inductance is important to the proper operation of snubber capacitors. The channel of capacitor distribution here is usually in accordance with the sale of the semiconductor. It remains a good growth market for specialty manufacturers of snubber capacitors.
  • In addition to snubber technology; there are two main types of plastic film and ceramic chip interference suppression capacitors, which are the X versions and the Y versions. These designations are the result of standards set by various international governing agencies mentioned in the introduction. In short, X capacitors are line-to-line capacitors used to suppress radio frequency interference in electrical systems; and the Y capacitors are line-to-ground capacitors used to suppress radio frequency interference in electrical systems. There are great markets for interference suppression capacitors in smoke detectors, power supplies, lighting ballasts and thermostats- all important anchor areas for the Internet of Everything; so this as well is considered a growth segment of the market going forward.
  • Power Supplies, Adapters and DC/DC Converters
    Switchmode power supplies and DC to DC converter "Brick Modules" require capacitor smoothing for the input filters, which is usually plastic film or ceramic; and the output filters which is usually always aluminum electrolytic but sometimes tantalum. This is an enormous market globally because every electrical device usually requires a power supply of some type, so every television set, or home theatre accessory; every power adapter and transformer require capacitors. The greatest market value is in the output filtering process because of the required combination of voltage and capacitance, which is a narrow area for the aluminum capacitor manufacturers to compete in, but it represents a significant portion of the overall aluminum capacitor market on a global scale. We see a significant amount of activity in making power supplies, adapters and converters smaller and more efficient and the capacitors are an important part of that equation. Power supply customers for both aluminum and plastic film capacitor manufacturers are so critical to the larger capacitor market that competition among the relatively few major manufacturers in power supplies makes the market aggressive and competitive.
  • Lighting Capacitors
    Both AC and DC film capacitors count lighting as a major end-use market segment and this has been true for decades. AC film capacitors have been historically consumed in two separate markets in the lighting ballast industry- the PFC magnetic ballast business, and in the high intensity discharge lighting business. The DC film capacitor markets are heavily invested into ballasts of all type including electronic ballasts and LED drivers. Capacitors used in lighting are for signal smoothing, interference suppression and in some instances burst power and can be either plastic film, ceramic or aluminum in design and in many instances a combination of all three dielectrics in a single ballast.
  • Hidden Gems: Fragmented Sub-Markets
    Pulse capacitors are DC circuit capacitors that absorb or supply strong current surges. They are charged sporadically and briefly discharged in relation to the charge time or vice versa. Discharge capacitors are subjected to high loads, high field strength, and large peak currents because of the fast discharge and require advanced technical knowledge to build. Pulse capacitors find their niche in various forms of research and development for generating strong magnetic fields; for high-energy light flashes; high temperature electronics and high pulses of electrical energy.

The following applications for pulse capacitors illustrates the variation in end markets for the fragmented sub-markets for capacitors in various granular sub-segments of the larger markets-

  • Laser (Industrial and Medical)
  • Defibrillator (external only)
  • X-Ray Machines (Pulsed)
  • Ultrasonics (Pulse Welders, Cleaners)
  • Airport Runway Strobes
  • Pulse Forming Networks for Radar
  • Water Purification
  • Rail-gun Power
  • Missile Power Up
  • Food Sterilization
  • Marx Generators
  • Television and Radio Transmitter Capacitors

Summary and Conclusion

The industrial end-use market for capacitors is a broad category that includes multiple levels of fragmented supporting markets. Plastic film capacitors are the primary dielectric consumed in the space, but specialty packaged and designed ceramic capacitors and large can aluminum capacitors also have considerable market share and represent large dollar values within the industrial end-use segment. Emerging capacitor markets include the double layer supercapacitor for load-leveling and energy recoup and for tantalum capacitors consumed in motor controllers used in robotics and 3D printers.

The overall trend in the market remains positive because of government regulations and goals from around the world regarding not only the generation of the electricity but also the improvement of power efficiency in multiple power hungry devices. Capacitors play an important role in this transition and will continue to do so for the foreseeable future suggesting a slow but steady growth market over time with significant opportunities in even the most granular sub-segments of the global industry.