Malaysia Flexible Alternating Current Transmission System Market Size, Share, Trends and Forecasts 2031

Key Findings

• The Malaysia Flexible AC Transmission System (FACTS) Market is expanding significantly due to rising energy demand, rapid grid modernization, and increasing integration of renewable energy sources into transmission networks.
• Growing deployment of wind, solar, and distributed energy resources is intensifying the need for voltage stabilization, reactive power compensation, and enhanced grid controllability in Malaysia.
• FACTS technologies such as STATCOM, SVC, TCSC, and UPFC are being widely adopted to improve transmission efficiency, reduce line losses, and enhance power system flexibility.
• Expansion of smart grids and digital substations is driving demand for synchronous and power-electronic-based compensation devices.
• Investments in transmission infrastructure, grid automation, and high-voltage power networks are accelerating FACTS adoption across utilities in Malaysia.
• Challenges include high installation costs, complex system integration, limited skilled workforce, and long approval cycles for large transmission projects.
• Governments and regulatory bodies in Malaysia are promoting FACTS deployment through grid reliability standards, renewable integration mandates, and modern energy policies.
• Collaboration between power equipment manufacturers, EPC contractors, and grid operators is shaping the FACTS market landscape.

Malaysia Flexible AC Transmission System Market Size and Forecast

The Malaysia FACTS Market is projected to grow from USD 1.42 billion in 2025 to USD 2.87 billion by 2031, at a CAGR of 12.3%. Increasing renewable penetration, aging transmission infrastructure, and rising grid stability needs are driving FACTS investment across Malaysia. Utilities are adopting STATCOM and SVC systems to improve reactive power management and maintain voltage stability during fluctuating loads. Large-scale power transmission projects, HVDC systems, and inter-region power exchange corridors require FACTS technologies to ensure efficient and stable power flow. With rapid electrification of industries, expansion of EV charging networks, and modernization of substations, FACTS will remain essential for stable and resilient grid operations.

Introduction

Flexible AC Transmission Systems (FACTS) are advanced power-electronic-based solutions designed to enhance the controllability, stability, and power transfer capability of AC transmission networks. FACTS devices improve voltage regulation, reduce transmission congestion, manage reactive power, and improve dynamic performance of electrical grids. In Malaysia, growing electricity consumption, renewable energy integration, and grid expansion are creating strong demand for FACTS systems. Devices such as STATCOM, SVC, TCSC, and UPFC help utilities stabilize voltage fluctuations, minimize line overloads, and optimize grid efficiency. FACTS also support frequency stability, load balancing, and improved power quality, making them essential for modern smart grids and high-voltage transmission systems.

Future Outlook

By 2031, the Malaysia FACTS Market will evolve with digitally controlled power electronics, AI-enabled predictive maintenance, wide-bandgap semiconductor devices, and autonomous grid management. SiC and GaN-based converters will enhance energy efficiency and reduce the size of FACTS controllers. As renewable energy installations grow, utilities in Malaysia will require more sophisticated FACTS technologies for grid synchronization, inertia support, and distributed energy coordination. Smart substations will incorporate integrated FACTS units, remote monitoring, and real-time grid optimization features. Electrification of transport and industries will drive expansion of high-voltage corridors that require FACTS for stable power flow. Policy incentives, increased R&D investment, and growing emphasis on energy security will accelerate long-term adoption.

Malaysia Flexible AC Transmission System Market Trends

• Growing Deployment of STATCOM Solutions for Voltage Stability
  STATCOM (Static Synchronous Compensator) is emerging as the preferred FACTS device due to its fast response time, compact footprint, and high efficiency. Utilities in Malaysia deploy STATCOMs for voltage control, reactive power compensation, and stabilization of renewable-heavy grids. They provide dynamic voltage support and improve grid reliability during fluctuating load conditions. STATCOM demand is increasing significantly for wind farms, solar parks, and EV charging networks where voltage variability is high.

• Rising Adoption of SVC and TCSC for Long-Distance Transmission Lines
  Flexible AC Transmission solutions such as SVC (Static VAR Compensator) and TCSC (Thyristor-Controlled Series Capacitor) are widely used in Malaysia to enhance power flow and reduce line congestion. These devices improve the loading capability of long-distance transmission lines and help balance reactive power across regional grids. With increasing electricity demand and cross-border power exchange, utilities are investing more in series compensation and reactive power control technologies.

• Expansion of Renewable Energy Integration Requiring Advanced Grid Stabilization
  High penetration of renewable energy such as wind and solar introduces intermittency, voltage fluctuations, and reduced system inertia. Utilities in Malaysia are deploying FACTS to manage reactive power, mitigate voltage swings, and ensure seamless integration of distributed energy resources. FACTS technologies are becoming critical for stabilizing weak grids and connecting large-scale renewable power plants.

• Increasing Use of Power Electronics and Wide-Bandgap Semiconductors
  FACTS devices increasingly use advanced power electronics including SiC (Silicon Carbide) and GaN (Gallium Nitride) to improve conversion efficiency, thermal performance, and compactness. These wide-bandgap technologies enable high-frequency switching, reduced losses, and faster response times. As grid modernization accelerates, power-electronics-based FACTS devices are rapidly replacing traditional mechanical components in Malaysia.

• Growing Adoption of Digital Substations and Smart Grid Automation
  Utilities in Malaysia are modernizing substations with IEC 61850-based automation, digital protection systems, and remote monitoring tools. FACTS systems integrated with digital substations enable better control, data analytics, and real-time optimization. Smart grid solutions enhance operational reliability, enable predictive maintenance, and support coordinated control of distributed energy resources.

Market Growth Drivers

• Increasing Renewable Energy Integration Across Transmission Networks
  Growing adoption of wind and solar power in Malaysia requires sophisticated grid stabilization tools. FACTS technologies ensure voltage stability, reactive power balancing, and improved system reliability. With renewable installations expanding, FACTS will remain indispensable for future grid performance.

• Need for Grid Reliability and Transmission Efficiency Enhancements
  Rising electricity demand and aging infrastructure strain existing transmission networks. FACTS help utilities improve power transfer capability, reduce losses, and maintain stable grid operations. Upgrading transmission efficiency is a major driver for FACTS adoption across Malaysia.

• Large Investments in Power Infrastructure and Grid Modernization
  Governments and utilities in Malaysia are investing heavily in modern power transmission systems, digital substations, and inter-regional electricity corridors. FACTS technologies play a vital role in enabling these projects by improving system flexibility and dynamic stability.

• Electrification of Transport and Industrial Sectors
  Expansion of EV charging networks, industrial electrification, and increasing load densities are driving the need for robust transmission systems. FACTS help maintain power quality and voltage stability under rapidly changing load patterns across Malaysia.

• Government Policies and Supportive Regulatory Frameworks
  Policies promoting renewable integration, energy security, and smart grid development are encouraging utilities to deploy FACTS solutions. Government grants, regulatory incentives, and grid reliability standards support long-term market growth.

Challenges in the Market

• High Installation and Maintenance Costs
  FACTS devices require significant investment in high-voltage components, advanced power electronics, and sophisticated control systems. These high installation costs can limit adoption, especially for smaller utilities and developing regions in Malaysia.

• Complex System Integration Across Transmission Networks
  Integrating FACTS with existing substations, HV lines, and grid control systems requires advanced engineering expertise. Compatibility with legacy components and communication systems poses challenges during deployment.

• Limited Technical Expertise and Skilled Workforce Shortage
  FACTS deployment and maintenance require specialized skills in power electronics, grid control, and high-voltage engineering. Malaysia faces talent shortages that may slow down project implementation and long-term maintenance.

• Lengthy Regulatory Approvals and Infrastructure Planning Delays
  FACTS projects often face slow approval cycles due to environmental assessments, transmission planning requirements, and regulatory barriers. These delays can impact capital timelines and slow grid modernization efforts.

• Uncertainty in Renewable Generation Affecting FACTS Planning
  Intermittent renewable energy generation creates unpredictable voltage and reactive power fluctuations. Without accurate forecasting, utilities may face challenges in planning optimized FACTS deployment across Malaysia.

Malaysia Flexible AC Transmission System Market Segmentation

By Type

• Shunt Compensation (STATCOM, SVC)

• Series Compensation (TCSC, TSSC)

• Combined Compensation (UPFC, IPFC)

By Component

• Power Electronics Devices

• Capacitors & Reactors

• Transformers

• Control Systems

• Protection & Monitoring Systems

• Others

By Voltage Level

• Medium Voltage

• High Voltage

• Extra-High Voltage

By Application

• Voltage Control

• Power Flow Control

• Grid Stabilization

• Reactive Power Compensation

• Renewable Energy Integration

• Transmission Congestion Management

By End-User

• Utility Companies

• Renewable Energy Developers

• Industrial Power Consumers

• Transmission System Operators

• Government & Public Infrastructure Entities

Leading Key Players

• ABB Ltd.

• Siemens Energy

• General Electric (GE)

• Mitsubishi Electric

• Hitachi Energy

• NR Electric Co.

• Toshiba Energy Systems

• Hyosung Heavy Industries

• American Superconductor Corporation (AMSC)

• Bharat Heavy Electricals Limited (BHEL)

Recent Developments

• ABB Ltd. deployed advanced STATCOM units to stabilize renewable-integrated transmission corridors in Malaysia.

• Siemens Energy partnered with TSO organizations in Malaysia to develop digitalized FACTS solutions for smart grid modernization.

• General Electric launched compact UPFC and digital FACTS controllers supporting high-capacity transmission lines in Malaysia.

• Mitsubishi Electric expanded FACTS manufacturing capabilities to support regional 5G-driven power infrastructure upgrades in Malaysia.

• Hitachi Energy introduced AI-enhanced FACTS diagnostic tools for predictive maintenance and real-time monitoring in Malaysia.

This Market Report Will Answer the Following Questions

1. What is the projected market size of the Malaysia Flexible AC Transmission System Market by 2031?

2. Which FACTS technologies STATCOM, SVC, TCSC, UPFC are seeing the highest adoption in Malaysia?

3. How does increasing renewable integration influence FACTS deployment?

4. What major challenges affect FACTS implementation across utilities in Malaysia?

5. Who are the leading manufacturers shaping technological advancements in the FACTS market?