Global Combined Heat and Power Installation Market: Key Trends
The upsurge in the consumption of fuel derived from biomass, wood, and waste heat, is likely to boost the installation of combined heat and power (CHP) across the globe. Transparency Market Research forecasts the global CHP installation market to exhibit a CAGR of 4.38% between 2014 and 2024. The prospects for CHP installations have improved globally in response to the rising energy prices. This, combined with stringent regulations implemented to curb carbon emissions from conventional systems, is expected to aid the proliferation of CHP systems worldwide.
CHP systems run on both renewable and non-renewable fuels such as natural gas, coal, wood, biomass, oil, and waste heat. They can operate at an efficiency level as high as 77% to 90% as compared to the 46% efficiency level of conventional systems. However, the best economics of a CHP system is achieved in cold climates, when the energy rates are high, prices of natural gas fall, and there is a continuous demand for heat. Besides this, diverse functionalities offered by CHP systems also encourage their installation in both colder and hotter regions.
Strong Existing Network of CHPs to Boost their Installation Worldwide
Based on in-depth research, TMR has pegged the combined heat and power installations worldwide to reach US$812.80 bn by 2024. The global CHP installation market stood at US$524.89 bn in 2014. The market will further gain impetus from the strong existing CHP network. The increasing awareness about CHP systems, particularly in developing nations is likely to translate into increased sales for the global CHP installation market. These countries are exhibiting high aggregate demand for energy-efficient technologies, thus creating enough opportunities for the market to leverage from during the report’s forecast period.
However, TMR expects the value chain of the global combined heat and power installation market to remain complicated with the prominent companies in the market adopting forward integration in response to the implementation of stringent policies by governments. Additionally, high initial cost incurred on the installation of CHP systems also discourages their widespread deployment. Nevertheless, the market is expected to find substantial opportunities in the residential and commercial energy markets in the near future.
Demand for Large-scale CHPs to Increase in Emerging Economies
The global CHP installation market can be broadly bifurcated into micro- and small-scale CHPs and large-scale CHPs. The latter of these segments has been witnessing overwhelming demand over the last few years. By revenue, the large-scale CHPs segment accounted for a share of 85.69% in the market in 2014. However, the segment is likely to lose a significant portion of its market share in the forthcoming years as the usage of small-scale CHPs increase globally. Growth exhibited by the micro- and small-scale CHPs is expected to be the fastest during the forecast period. Nevertheless, the increasing installation of CHP systems in developing nations such as India and China will keep the demand for large-scale CHP systems high during the forecast period.
Easy Availability of Natural Gas Boosts CHP Installations in Europe
Regionally, Europe exhibits the most lucrative prospects for the global combined heat and power installation market. The region held a share of 67.96% in the overall market in 2014. The easy availability of natural gas in Europe makes installation of CHPs relatively easier and more cost-effective. This has been spurring demand for CHP installations in countries such as Belgium, Germany, Poland, Italy, and Netherlands.
The leading vendors in the market are also exploring opportunities in Asia Pacific. The high demand for small-scale CHPs in Japan, coupled with their increasing installation across diverse industries, has been boosting demand for the CHP installation in the region.
The competitive landscape of the global combined heat and power installation market is highly fragmented. Some of the leading enterprises operating in the market include 2G Energy AG, Siemens AG, Edina Ltd., Wärtsilä Corporation, ENER-G Holdings Plc (ENER-G), Clarke Energy Ltd., and others.
This research study analyzes the market for CHP installation in terms of revenue (US$ Bn) and capacity (GW). The CHP installation market has been segmented on the basis of type, application, technology, fuel, and region. In terms of region, the market has been further divided into four segments that comprise sixteen countries, which are major players in the global CHP market. For the research, 2014 and 2015 have been taken as the base years, while all forecasts have been given for the period from 2016 to 2024. Market data for all the segments has been provided at the regional level from 2016 to 2024. The report provides a broad competitive analysis of companies engaged in the CHP business. The report also includes the key market dynamics such as drivers, restraints, and opportunities affecting the global CHP market. These market dynamics were analyzed in detail and are illustrated in the report with the help of supporting graphs and tables. The report also provides a comprehensive analysis of the global CHP market with the help of Porter’s Five Forces model. This analysis helps in understanding the five major forces that affect the market structure and market profitability. The forces analyzed are bargaining power of buyers, bargaining power of suppliers, threat of new entrants, threat of substitutes, and degree of competition.
The high-level analysis in the report provides detailed insights into the CHP business globally. There are currently numerous drivers of the market. One of the most prominent drivers is the supportive government policies for the installation of CHP equipment. Market attractiveness analysis was carried out for the CHP installation market on the basis of application and technology. Market attractiveness was estimated on the basis of common parameters that directly impact the market in different regions.
The CHP market was segmented on the basis of type (large-scale and micro & small-scale), by application (residential, commercial, and industrial), by technology (combined cycle, combustion/gas turbine, steam turbine, reciprocating engine, others (microturbine, fuel cell, and waste heat recovery)), and by fuel (natural gas, coal, biomass, others (wood, waste heat, and oil)). A CHP system varies according to its type and application. The CHP installation market was analyzed across four geographies: North America, Europe, Asia Pacific, and Rest of World. Regional data has been provided for each sub-segment of the CHP installation market. Key players in the CHP installation market include 2G Energy AG, ABB Ltd., Aegis Energy Services, Inc., BDR Thermea Group B.V., Bosch Thermotechnik GmbH, Caterpillar Energy Solutions GmbH, Clarke Energy Ltd., Veolia Environnement S.A., Dantherm Power A/S, Edina Ltd., E.ON SE, ENER-G Holdings Plc, General Electric Company, Mitsubishi Hitachi Power Systems, Ltd., Siemens AG, Viessmann Werke GmbH & Co. KG, Wärtsilä Corporation, Yanmar Co., Ltd., FuelCell Energy, Inc., and Helen Ltd. The report provides an overview of these companies, followed by their financial details, business strategies, and recent developments.
CHP Installation Market: By CHP Type
- Large-scale CHP
- Micro & Small-scale CHP
CHP Installation Market: By CHP Application
CHP Installation Market: By CHP Technology
- Combined Cycle
- Steam Turbine
- Combustion/Gas Turbine
- Reciprocation Engine
- Others (Microturbine, Fuel Cell, and Waste Heat Recovery)
CHP Installation Market: By Fuel
- Natural Gas
- Others (Wood, Waste Heat, and Oil)
CHP Installation Market: By Region
- North America
- Rest of Europe
- Asia Pacific
- South Korea
- Rest of Asia Pacific
- Rest of World