The equipment cost of GIS is naturally higher than that of AIS due to the grounded metal enclosure, the provision of an LCC, and the high degree of factory assembly. A GIS is less expensive to install than an AIS. The site development costs for a GIS will be much lower than for an AIS because of the much smaller area required for the GIS.
The site development advantage of GIS increases as the system voltage increases because high voltage AIS take very large areas because of the long insulating distances in atmospheric air. Cost comparisons in the early days of GIS projected that, on a total installed cost basis, GIS costs would equal AIS costs at 345 kV. For higher voltages, GIS was expected to cost less than AIS.
However, the cost of AIS has been reduced significantly by technical and manufacturing advances (especially for circuit breakers) over the last 30 years, but GIS equipment has not shown any cost reduction until very recently.
Therefore, although GIS has been a well-established technology for a long time, with a proven high reliability and almost no need for maintenance, it is presently perceived as costing too much and is only applicable in special cases where space is the most important factor.
Currently, GIS costs are being reduced by integrating functions (double bus, single breaker arrangement). As digital control systems become common in substations, the costly electromagnetic CTs and VTs of a GIS will be replaced by less-expensive sensors such as optical VTs and Rogowski coil CTs.
These less-expensive sensors are also much smaller, reducing the size of the GIS and allowing more bays of GIS to be shipped fully assembled. Installation and site development costs are correspondingly lower.
The GIS space advantage over AIS increases. GIS can now be considered for any new substation or the expansion of an existing substation without enlarging the area for the substation.
SOURCE: Philip Bolin, Mitsubishi Electric Power