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Walk into a switchgear factory in Wenzhou this month. You will see assembly lines running at full capacity. Managers say orders have climbed since January. Deliveries are scheduled into the fourth quarter of 2026.
Image Source: 699pic.com
The medium voltage equipment sector in China is having a busy year. This includes switchgear, transformers, variable frequency drives, and cable accessories. According to an IndexBox report from early May, the market for air insulated medium voltage switchgear alone reached an estimated RMB 58 billion to 65 billion in 2026. The same report projects the market to exceed RMB 100 billion by 2035. Growth is running at 6 to 7 percent annually. Grid modernization and renewable energy projects are driving the numbers.
State Grid Corporation of China and China Southern Power Grid have both increased their procurement of locally made gear. A procurement manager at a provincial utility, who asked not to be named, said his team now looks at domestic suppliers first. “We only go to foreign brands if the local product cannot meet the technical requirements,” he said. “That happens less often than it used to.”
CHINT Group reported higher order volumes in the first quarter of 2026. Hebei Senyuan Electric and XD Group also saw increases. These companies now compete head to head with ABB, Siemens, and Schneider on mid-range projects. Five years ago, that was not the case.
In late April 2026, China Southern Power Grid signed off on the first domestically made medium voltage air compressors for pumped storage power plants. Anhui Guoying Anqing Haiyan Machinery Factory built the units. Pumped storage plants use these compressors to start and stop turbines. Until this approval, every single compressor of this type came from overseas. The factory acceptance tests showed performance numbers that matched or beat the imported versions. Displacement volume, efficiency, vibration, noise, long-term stability. All passed. A project manager called it a “zero to one” breakthrough for Chinese manufacturing.
Renewable energy is also pulling demand. Solar farms need compact ring main units to connect to the grid. Wind projects need secondary substations. Industry data shows annual demand for ring main units alone has topped 1.2 million units. The growth rate for renewables-related medium voltage equipment is running at 10 to 12 percent per year. That is faster than utility and industrial segments.
On the variable frequency drive side, domestic brands are moving into territory once held by European and Japanese companies. SOSIAT, based in Zhejiang, launched its 10kV medium voltage VFD series in early 2026. The units cover 250 kW to 3,700 kW. They target mining, oil and gas, cement, and large pumping systems. The company claims energy savings of 30 to 50 percent in variable load applications.
VEICHI Electric, traded on Shanghai’s Sci-Tech Innovation Board under ticker 688698, offers the ACH200 series for 3 kV to 11 kV. Their open-loop vector control delivers 150 percent starting torque at 0.5 Hz. A few years ago, that spec was rare for a domestic brand.
But the industry still has gaps. High-end vacuum interrupters rated for 40 kA interrupting capacity and above. Most come from Japan or Germany. Digital protection relays from Switzerland. Precision current transformers from Japan. During peak demand, lead times on these components stretch to 16 weeks. A sourcing manager at a Jiangsu-based switchgear assembler said his company now orders critical imported parts at least six months ahead. “We cannot afford to stop the line,” he said.
By unit volume, domestic production meets 85 to 90 percent of China’s medium voltage demand. By value, imports take a larger share because foreign components cost more. Exports reached over RMB 12 billion worth of medium voltage switchgear in 2025. Main destinations are Southeast Asia, Africa, and the Middle East. In the Asia-Pacific region, Chinese suppliers provide an estimated 30 to 35 percent of cross-border trade in commercial switchgear.
Production clusters are concentrated in a few areas. Zhejiang, around Wenzhou and Hangzhou, is the largest. Jiangsu, centered on Nanjing and Suzhou, is second. Guangdong and Hebei also have significant capacity. Total annual production is estimated at 3.5 million to 4 million panels and ring main units. Most of it stays in China.
Copper prices remain a problem. Prices have swung 20 to 30 percent since 2023. That directly hits busbars and windings. Each spike squeezes manufacturer margins. Smaller shops feel it the most. They do not have the purchasing scale or hedging tools of the big players.
Chang Lan Technology Group, based in Changsha, works in the medium and low voltage cable accessory segment. The company was founded in 1958. It supplies power grids, subways, railways, and nuclear plants. The global market for medium voltage cable accessories reached RMB 343.9 billion in 2025. Projected annual growth is 6.7 percent through 2032.
What comes next? The easy phase of import substitution is mostly done. Basic products are now largely local. The hard part is competing on digital features, safety, and long-term reliability. State Grid and China Southern Power Grid are pushing distribution automation. That means switchgear with sensors, communication protocols, and remote monitoring. Utilities are starting to pay more for smart gear. One buyer said his team budgets 15 to 25 percent higher for IEC 61850-compliant units. The reason is operational savings over ten years.
The next five years will show whether Chinese medium voltage brands can move from acceptable to preferred. Early signs are positive. But the real test is still ahead.