The gas generator market is expected to play an important role in the energy mix of Europe, mainly used in industrial and commercial applications. The European gas generator market is expected to witness a CAGR of more than 5.1% over the forecast period, 2020 - 2025. Factors such as stringent environmental regulations, declining gas prices, rising demand for reliable power supply, and increasing demand for flexible transmission of renewable power are driving gas generators in Europe. The growing need for uninterrupted power supply during power outages and power failure has boosted the adoption of gas generators in all major sectors in Europe. However, limited power generation capacity, high maintenance & operating cost and a growing tendency towards renting gas generators are expected to restrain market growth, as customers see the financial benefits offered by renting, as opposed to buying generators.
- The industrial sector is expected to dominate the market during the forecast period, supported by the increase in demand from telecom, retail, and manufacturing industries.
- Europe has plans to move towards meeting its emission reductions targets by 2030, therefore, gas generators are expected to gain market share among end-user segments that were dominated by diesel generators as the region moves towards lower-emission fuel sources, which in turn, is expected to create significant opportunities for market participants in the near future.
- Germany is expected to be the largest market during the forecast period for Europe gas generator.
Key Market Trends
Industrial Sector to Dominate the Market
- Industrial sector is the dominant market for gas generators due to the rapid industrialization and urbanization in the region. For growing manufacturing industries continuous power supply is required. Therefore, industrial sectors are mainly dependent on electricity generated from generators during power outages and in regions where grid access is limited.
- Moving towards cleaner sources of power generation is also a key driver for industrial sectors to use gas generators, as countries in the region are keen on replacing polluting diesel generators in the future.
- Falling prices of gas also make gas generators attractive, as the project economics improve. The growth of power storage is also expected to play a role in increasing gas generators sales, as the demand for hybrid generator increases.
- The strengthening of the gas pipeline infrastructure and storage network across Europe is leading to the increasing uptake of gas generators in prime power and back-up power applications in industrial sector.
Germany to Dominate the Market
- To reduce emissions, Germany is rapidly adopting gas-based generators due to which the gas generators market is expected to dominate during the forecast period.
- The gas generator market is being driven by increasing renewable power generation, which creates the need for flexible baseload power to compensate for the intermittent nature of renewable energy, as well as the gas availability in Germany is encouraging countries to move towards more gas-based power.
- As the air emission norms are becoming more stringent in Germany, coupled with the environmental benefits, the demand for gas generators is expected to witness a significant increase, as compared to diesel generators.
- Growing adoption of gas generators as backup power source across hospitals, IT and financial service firms, and other commercial spaces in Germany is expected to have a positive influence on the industry landscape.
- This, in turn, is expected to drive the Europe gas generators market for back-up power applications in the coming years.
The Europe gas generator market is moderately consolidated. Some of the major players in the market include Caterpillar Inc., Cummins Inc., Generac Holdings Inc., MTU Onsite Energy Corp, and Himoinsa sl.
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