The cogeneration equipment market depicts a lucrative growth opportunity with rising product demand and increasing focus on sustainable energy generation.
Cogeneration, also known as combined heat and power (CHP), involves the concurrent production of electricity or mechanical power and useful thermal energy from a single source of energy.
Cogeneration systems provide improved efficiency over separate production of electricity and heat as heat that would otherwise be wasted in conventional power generation is utilized. Cogeneration Equipment Market Demand finds widespread application in industries, commercial buildings and districts/utilities to meet baseload power and thermal energy needs in an efficient manner. Growing awareness about energy conservation and focus on reducing carbon footprint is driving the adoption of cogeneration globally.
The global cogeneration equipment market size is estimated to be valued at US$ 30.48 billion in 2024 and is expected to exhibit a CAGR of 9.5% over the forecast period 2024 to 2031.
Key Takeaways
Key players operating in the cogeneration equipment market are Rolls-Royce plc, Siemens, ABB, Baxi Group, Andritz Energy and Environment, BDR Thermea Group, Mitsubishi Heavy Industries, Ltd., 2G Energy Inc., Clarke Energy Ltd., Capstone Turbine Corporation, Innovative Steam Technology, Inc., Aegis Energy Services Inc., Kawasaki Heavy Industries, Ltd, Enercon Industries, Yanmar, Naigai Industries, Inc., Yokogawa Electric, Mitsubishi Power India Private Limited, and Raj Process Equipments and Systems Pvt. Ltd.
The Cogeneration Equipment Market Size And Trends is witnessing robust growth driven by increasing power demand and focus on greater energy efficiency. Rapid urbanization and industrialization across developing nations are propelling the product demand. Moreover, rising awareness about carbon footprint reduction and stringent emission norms are further complementing the market growth.
Geographically, the Asia Pacific region dominates the global cogeneration equipment market and is expected to witness fastest growth during the forecast period. This can be attributed to rapid industrialization and infrastructural development activities in countries such as China and India. Supportive government policies and regulations encouraging sustainable energy production are boosting the regional market.
Market Key Trends
Decarbonization of power grids is one of the prominent trends spurring investments in cogeneration systems. Many countries have outlined carbon neutrality targets and are promoting adoption of clean electricity sources including cogeneration. For instance, European Union's Green Deal aims to achieve climate neutrality by 2050 which will significantly boost cogeneration capacity additions across the region. Additionally, growing implementation of performance-based incentive programs and renewable energy certificate schemes are encouraging wider deployment of cogeneration technology.
Porter's Analysis
Threat of new entrants: New players face high initial costs for technology and machinery installation. Bargaining power of buyers: Buyers have high bargaining power in the decentralized cogeneration equipment market due to availability of substitutes. Bargaining power of suppliers: Suppliers have moderate power due to availability of alternative component suppliers. Threat of new substitutes: Threat is moderate due to availability of alternative energy generation technologies. Competitive rivalry: Rivalry is high due to presence of global players offering similar technologically advanced and cost-effective cogeneration equipment.
Geographical regions: North America holds the largest share in the global market, primarily due to strict emission regulations in the US and Canada favoring efficient cogeneration systems. Asia Pacific market is expected to grow at the fastest pace during the forecast period led by increasing industrialization and infrastructure development in major economies including China and India.
Geographical regions: Japan is the fastest growing regional market for cogeneration equipment owing to the country's focus on optimizing energy usage through efficient cogeneration systems across manufacturing industries and commercial buildings. The Japanese government offers incentives and tax benefits to promote wider adoption of cogeneration technology.
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Money Singh is a seasoned content writer with over four years of experience in the market research sector. Her expertise spans various industries, including food and beverages, biotechnology, chemical and materials, defense and aerospace, consumer goods, etc. (https://www.linkedin.com/in/money-singh-590844163)
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