The global natural gas generator market size is projected to reach USD 10.87 Billion by 2025, registering a CAGR of 10.7% over the forecast period, according to a new report by Grand View Research, Inc. growing demand for back-up power coupled with increasing government regulation to reduce the carbon emission caused by diesel generator is likely to strengthen the growth for the natural gas genset market during the forecast period.
The global electricity demand is anticipated to witness an increase of nearly two-thirds the current demand over the forecast period. The current availability of natural gas in large quantities and its relatively lower prices, especially in regions such as North America and Europe, have led to an increase in power generation using natural gas.
Increasing focus on electricity generation through cleaner sources and environmental concerns arising from diesel generators are the factors anticipated to increase the share of natural gas generator set in the coming years.
Conventional generators such as diesel generator emit harmful gases including nitrogen oxide, hydrocarbons, and carbon monoxide due to the combustion of diesel. Due to this, different regulatory bodies have imposed stringent regulations that pose a barrier to the usage of diesel generators. This, in turn, has resulted in the growth of eco-friendly alternatives of diesel generators such as natural gas generator.
Emerging economies in Asia Pacific region such as India, China, Japan and others have witnessed a strong growth in commercial sectors. IT, telecom and retail sector, resulting in the growth of demand for natural generators over diesel generator for back-up power application owing to the increasing stringent government regulation to curb greenhouse gas emission caused by diesel generator.
Further key findings from the report suggest:
- Low power generator accounted for the largest market share in power rating segment with USD 2,321.7 million in 2018. Low power generator are very popular for residential and commercial power backup operation. Due to growing urbanization, national grids are getting pressurized which is resulting in the increased demand supply gap for power which is eventually driving the demand for natural gas generator market.
- Medium power generator in power rating segment is projected to grow at highest CAGR during the forecast period. Increasing demand from emerging economies such as China, India and Brazil for back -up power system which uses clean fuel, for commercial and industrial application are a major driver for medium power generators.
- For application segment, commercial segment accounted for the largest market share in 2018 and is projected to grow at highest CAGR during the forecast period Developing economies in Asia Pacific have witnessed strong growth in commercial sectors. IT, telecom, and retail are some of the major sectors that are growing rapidly in developing countries of Asia Pacific, resulting in a high demand for natural gas generators as natural gas generator are crucial for back-up power in these facilities.
- North America accounted for the largest market share in 2018. The abundance of natural gas in the U.S. coupled with developed infrastructure for transportation of natural gas within the country has played a vital role in driving the demand for gas generator sets in the U.S.
- Asia Pacific market is forecasted to witness highest growth during the forecast period and is projected to be valued at USD 2.84 billion by 2025. High growth of industrial sector in China, India, Japan, and South Korea has triggered the demand for industrial generator sets in the region.
- The establishment of heavy equipment, oil & gas, and process companies in China owing to low labor and utility costs has been one of the factors responsible for the growing penetration of gas generator set in the region.
- Some of the significant industry participants include Cummins Inc., Caterpillar Inc., Kohler co. Inc., Mitsubishi Heavy Industries, Ltd., MTU Onsite Energy, Generac Power Systems, Inc., Cooper Corp., General Electric, Yanmar Co., Ltd, Mahindra Powerol, and others. These players have adopted various organic and inorganic growth strategies to expand there product portfolio and geographical footprint.