Generators Sets Market Outlook 2031
The Generators Sets Market was USD 30.19 Billion in 2022 and is likely to reach USD 60.85 Billion by 2031, expanding at a CAGR of 8.1% during 2023 – 2031. The growth of the market is attributed to the expanding interest for continuous and reliable power from a wide range of end-use industries, such as IT/telecom, medical care, utility, oil and gas, and mining.
The difference between power supply and demand in almost all regions of the world has resulted in a huge demand for secondary energy systems called generator sets.
The exponential growth in power generation demand brought by industrialization and urbanization has created lucrative opportunities for the market growth. At the same time, the improvement of living standards has further stimulated the demand for energy production owing to the dependence on electricity, especially in urbanized areas.
Generators Sets Market Trends, Drivers, Restraints, and Opportunities
- Growing manufacturing sector in Asia Pacific is expected to boost the market growth during the forecast period.
- Rapid growth of the construction industry due to rapid infrastructure development, industrialization, and population growth are the key factors fueling the market growth in the coming years.
- Increasing disposable income is anticipated to drive the market growth during forecast period.
- The recent emergence of energy storage systems has impeded the growth of the generator set market.
- High operating cost can restrict the market growth.
- Rising awareness about environmental concerns and presence of alternatives such as solar cells and fuel cells can hamper the market growth during the forecast period.
- Increasing demand for hybrid, bi-fuel, and inverter generators is expected to create lucrative opportunities for the market players.
Scope of Generators Sets Market Report
The report on the global generator set market includes an assessment of the market, trends, segments, and regional markets. Overview and dynamics have also been included in the report.
Generator Set Market - Global Industry Analysis, Growth, Share, Size, Trends, and Forecast
Capacity (Below 75 kVA, 75-350 kVA, and Above 350 kVA), End- users (Industrial, Commercial, and Residential), Applications (Standby Backup Power, Prime/Continuous Power, and Peak Shaving Power)
Asia Pacific, North America, Latin America, Europe, and Middle East & Africa
Company Share, Market Analysis and Size, Competitive Landscape, Growth Factors, and Trends, and Revenue Forecast
Key Players Covered in the Report
Atlas Copco AB, Cummins Inc., Caterpillar Inc., Generac Holding Inc., and Honda Siel Power Products Limited
Global Generator Set Market Segment Insights
Below 75kVA segment is projected to represent a major market share
Based on capacity, the generator set market is divided into below 75 kVA, 75-350 kVA, and above 350kVA. The below 75kVA segment is expected to represent a key market share during the forecast period owing to increasing use of diesel generators below 75kVA in the telecommunication industry, shopping malls, small restaurants, small businesses, and gas stations. They are mainly used as emergency power sources in the network and connected to the main power supply off-grid. The purchase of small generators is mainly based on price and requirements, not efficiency, as they provide backup power. Limited and unreliable energy supply, especially in rural areas, is the key reason for high demand for small generators.
With changes in the business landscape, especially in developing countries in Asia Pacific and Africa, the demand for small generators in the range of 0-75 kVA is soaring. As of 2018, approximately 450,000 telecommunication towers in India require continuous power supply. As the telecommunication sector uses 0-75kVA diesel generators for emergency power supply in grid-connected areas and serves as the main energy source for off-grid areas, the segment is expected to grow exponentially in the projected timeline.
The construction market in India and China is growing at a robust rate owing to ongoing government initiatives, such as smart cities and green building initiatives, which are expected to generate demand for portable generators during the forecast period.
Commercial segment is expected to grow at a significant pace
On the basis of end-users, the generator sets market is segmented into commercial, industrial, and residential. The commercial segment is expected to hold a significant market share during the forecast period due to its application in industries such as healthcare, telecommunication, aquaculture, agriculture, data center, education, and hotel.
Generators are used in commercial facilities to respond to emergency power outages such as power outages or voltage fluctuations that can reduce the tension of financial losses. On the other hand, the industrial segment is anticipated to expand at a rapid pace during the forecast period owing to the increasing use in the oil and gas, transportation and logistics, mining, power generation, manufacturing, and construction industries. The government's favorable industrial development plans in emerging countries such as China, Brazil, and India are an important driving force for the market players.
Standby Backup Power segment is anticipated to expand at a substantial CAGR
In terms of applications, the market is categorized as standby backup power, prime/continuous power, and peak shaving power. The standby backup power segment is expected to expand at a substantial CAGR during the forecast period owing to the rapid development of healthcare infrastructure and the growing demand for data centers. Additionally, severe weather and related power outages in the US have increased the demand for backup generators, driving the segment growth.
Asia Pacific is expected to dominate the market
On the basis of regions, the generator set market is classified as Asia Pacific, North America, Latin America, Europe, and Middle East & Africa. The market in Asia Pacific is anticipated to expand at an impressive CAGR during the forecast period. India and China are the major countries that are expected to create lucrative opportunities for industry players in the projected timeline. Rapid growth in various end-use sectors such as infrastructure and telecommunication and information technology (IT) are expected to drive the demand for generator sets in India.
In Indonesia, the manufacturing industry has increased the use of generator sets to ensure a continuous and reliable power supply. The frequent power outages have led South Sumatra and Jakarta to use power generators.
The global generator set market has been segmented on the basis of
- Below 75 kVA
- 75-350 kVA
- Above 350 kVA
- Standby Backup Power
- Prime/Continuous Power
- Peak Shaving Power
- Asia Pacific
- North America
- Latin America
- Middle East & Africa
Key players competing in the generator set market include Atlas Copco AB, Cummins Inc., Caterpillar Inc., Generac Holding Inc., and Honda Siel Power Products Limited. Some expansion strategies such as new product launches, merger & acquisitions to gain a larger share in the generator market.
In February, 2019 - PR Industrial SRL, a subsidiary of Generac Holdings Inc., acquired Captiva Energy Solutions Private Limited to expand the power generation business in India.
In September, 2018 - Cummins partnered with Moser Energy Systems to design and manufacture generators based on the 19-liter Cummins G Drive natural gas engine named Moser CRC400. This gas engine reduces costs and improves the reliability of emergency and remote power supplies. It is also used in heavy commercial electrical applications in the US.