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Distributed Generation Market: Snapshot

Rising demand for power, recovering economies of developed countries, increasing cost of fossil fuels-generated power, increasing emphasis on reduction of carbon emissions, and a lack of power transmission & distribution infrastructure in off-grid areas are major factors responsible for the rising demand for distributed generation across the globe. Distributed generation is defined as the power generation at the point of consumption. Distributed generation generate power by utilizing various technologies such as solar photovoltics, wind turbines, CHP (combined heat and power), reciprocating engines, micro turbines, and fuel cells to provide on-site power to consumers. Distributed generation provides clean power by means of renewable technologies such as solar photovoltics and wind turbines in combination with energy storage systems in order to provide clean electricity to consumers. Distributed generation based on renewable energy is proving helpful in providing low cost and clean energy to the population living in bad-grid and off-grid areas. Other technologies such as CHP (combined heat and power), reciprocating engines, and micro turbines are utilized to provide back-up support to the main electricity grid.

CHP-based distributed generation technology utilizes the heat from waste exhaust gases from gas/steam turbines to generate steam from the boilers, which then run secondary steam turbines to generate additional power. This not only improves overall thermal efficiency of the existing power generation system, but also provides additional power generation. Moreover, usage of CHP-based distributed generation also reduces emissions and the cost of electricity generation from the power plants, thus helping in sustainable and affordable low cost power generation. Installation of distributed energy generation systems require significant capital investments, which increases the initial cost of the power; however, in the long run, it produces affordable and low-cost power to support on-grid as well as off-grid sectors, in terms of energy generation. Large-scale distributed energy generation systems require considerable capital investments, as compared to medium- and small-scale distributed energy generation system installations. Small-scale distributed energy generation systems are largely based on solar photovoltaic technology owing their low cost and ease of installations. Introduction of fuel cell technology in combination with CHP systems is anticipated to help in the generation of clean energy with high thermal efficiency. Utilization of fuel cell technology in the transportation sector is likely to help minimize environmental emissions. Development of small power plants based on renewable energy distributed energy generation technologies in the off-grid sector is also projected to help mitigate the high cost of grid connection and power transmission. Moreover, it is likely to help provide low cost power to consumers in the off-grid sector with minimum environmental emissions. Development of micro turbines, which are small in size and operate on a variety of fuel sources, is estimated to make them an attractive combination with CHP technology in regions where the cost of grid-connected electricity is high. Compatibility of micro turbines with biogas and natural gas makes them an ideal choice for off-grid and rural sector power development.

distributed generation market

Distributed Generation Market - Segmentation   

The distributed energy generation systems market can be segmented based on technology, application, and end-user. Technology segment is sub-segmented into solar photovoltics, wing turbines, CHP, reciprocating engines, micro turbines, and fuel cells. CHP technology can be readily utilized with reciprocating engines, micro turbines, and fuel cells in order to generate clean energy with low carbon emissions and also improve the overall electricity generation capacity. Fuel cells and micro turbines have a high cost of installation; however, these technologies are likely to offer high growth potential in in the near future for distributed energy generation systems market. Fuel cells employ electrochemical reaction in order to generate energy and water. Currently, high cost of installation and safety concerns are a few restraints of fuel cell-based distributed energy generation technology. However, the technology is witnessing considerable R&D in order to make it feasible, in terms of economy and safety. Currently, North America is the dominant region for the usage and installation of fuel cell-based distributed energy generation systems. It is still in introductory phase in rest of the regions across the globe.

Distributed energy generation systems are employed for providing grid support during peak demand time and help reduce the load on the electricity grid. CHP and reciprocating engines of various sizes and power generation capacities are utilized for on-grid support services. Most potential applications of distributed generation technologies are observed in off-grid and bad-grid sectors. Off-grid sectors have no access to grid connected electricity and the cost of expanding transmission & distribution network in these areas is anticipated to increase the cost of electricity consumption in off-grid areas. Renewable energy-based distributed energy generation systems of low, medium, and high power generation capacities can generate affordable and low-cost electricity for consumers in off-grid areas. High capacity distributed energy generation systems generate grid-scale power through solar or wind farms, which can form mini/micro grids in order to distribute power at low cost.

Small- and medium-scale distributed energy generation systems can be utilized for power generation as roof top solar power generation units to generate independent grid-free electricity for residential or commercial usage. Most distributed energy generation systems are grid connected; however, the off-grid sector is anticipated to offer ample growth opportunities for renewable energy-based distributed generation in the near future. Small-scale renewable energy-based distributed energy generation systems can provide low-cost power to people living in off-grid sectors, while megawatt capacity-level power can be generated by utilizing micro/mini-grid scale distributed generation systems, which can be used and distributed through existing transmission and distribution network of the grid. They can also be used as a back-up source of power by consumers in on-grid and off-grid sectors.

Distributed energy generation systems produce clean and low-cost power. This generated power is mostly consumed by the industrial sector followed by residential, commercial, and buildings & institutions sectors. The industrial sector also consumes most of the electricity produced from the power plants. Usage of distributed energy generation systems can help provide low-cost and clean power to the industrial sector. The residential sector also consumes a significant amount of electricity supplied from the grid. The price of the electricity can be reduced by generating additional power through distributed energy generation systems. District heating and cooling services can be provided at cheaper cost by using CHP and CCHP distributed generation technologies. This can be utilized in providing heating services to residents, buildings, and institutions during winter time. They can also be employed to provide cooling services during the summer time.

Increasing environmental regulations regarding air emissions, rising cost of fossil fuels-generated electricity, increasing demand for electricity from off-grid areas, and the high cost of grid transmission and distribution infrastructure in off-grid areas are likely to boost the distributed energy generation systems market during the forecast period. The high cost of installation and maintenance, a lack of small-scale power providers, and a lack of awareness about distributed energy generation systems are anticipated to restrain the global distributed energy generation systems market. Key players operating in the global distributed energy generation systems market include Alstom S.A., E.ON. SE, Caterpillar Power Plants, Siemens Energy, Doosan Fuel Cell America, Ballard Power Systems, Bloom Energy, General Electrical Power, Sharp Corporation, Enercon, Fuel Cell Energy, Rolls-Royce Power Systems, Mitsubishi Hitachi Power Systems, Americas, Inc., Capstone Turbine Corporation, and OPRA Turbines BV.

Global Distributed Generation Market: Overview

Distributed energy generation is defined as the power generation at the point of consumption. Distributed generation generates power by utilizing various technologies such as solar photovoltaic, wind turbines, CHP (combined heat and power), reciprocating engines, micro turbines, and fuel cells in order to provide on-site power to consumers. Distributed energy generation systems provide clean power by means of renewable technologies such as solar photovoltaic and wind turbines in combination with energy storage systems in order to provide clean electricity to consumers. Distributed energy generation systems based on renewable energy are proving helpful in providing low cost and clean energy to the population living in bad-grid and off-grid areas. Rising demand for power, recovering economies of developed countries, increasing cost of fossil fuels-generated power, growing emphasis on reduction of carbon emissions, and a lack of power transmission & distribution infrastructure in off-grid areas are key factors that are boosting the demand for distributed energy generation systems across the globe.

Other distributed power generation technologies such as CHP (combined heat and power), reciprocating engines, and micro turbines are utilized to provide back-up support to the main electricity grid. CHP-based distributed energy generation technology utilizes the heat from waste exhaust gases from gas/steam turbines to generate steam from the boilers, which then run secondary steam turbines in order to generate additional power. The distributed energy generation systems market can be segmented based on technology, application, and end-user. The technology segment can be sub-segmented into solar photovoltaic, wing turbines, CHP, reciprocating engines, micro turbines, and fuel cells. CHP technology can be readily employed with reciprocating engines, micro turbines, and fuel cells to generate clean energy with low carbon emissions and also improve the overall electricity generation capacity.

Renewable energy-based distributed energy generation systems of low, medium, and high power generation capacities can generate affordable and low-cost electricity for consumers in off-grid areas. High generation capacity distributed energy generation systems generate grid scale power through solar or wind farms, which can form mini/micro grids in order to distribute low-cost power. Small- and medium-scale distributed energy generation systems can be utilized as roof top solar power generation units to generate independent grid-free electricity for residential or commercial usage. Most distributed energy generation systems are grid connected; however, the off-grid sector is anticipated to provide significant growth opportunities for renewable energy-based distributed energy generation systems in the near future. Distributed energy generation systems produce clean and low-cost power. This generated power is mostly consumed by the industrial sector, followed by residential, commercial, and buildings & institutions sectors. The industrial sector also consumes most of the electricity produced from power plants. Usage of distributed energy generation systems can help provide low cost and clean power to the industrial sector. District heating and cooling services can be provided at cheaper cost, by using CHP and CCHP distributed energy generation technologies. They can also be utilized to provide heating services to the residents, buildings, and institutions during winter time. They can also be employed to provide cooling services during the summer time.

Increasingly stringent environmental regulations regarding air emissions, rising cost of fossil fuels-generated electricity, increasing demand for electricity from off-grid areas, and the high cost of grid transmission and distribution infrastructure in off-grid areas are anticipated to boost the distributed energy generation systems market during the forecast period.

The report estimates and forecasts the distributed generation market on the global and regional levels. The study provides forecast between 2017 and 2025 based on cumulative installed capacity or volume (MW) & Y-o-Y investment potential (US$ Mn) with 2016 as the base year. The report comprises an exhaustive value chain analysis for each of the segments with detailed list of distributed generation technology providers. It provides a comprehensive view of the distributed generation market. The study also provides the utility scale potential customers for distributed generation. The study includes drivers and restraints for the distributed generation market along with their impact on demand during the forecast period. The study also provides key market indicators affecting the growth of the market. The report analyzes opportunities in the distributed generation market on the global and regional level. Drivers, restraints, and key trends mentioned in the report are justified through quantitative and qualitative data. These have been verified through primary and secondary resources. Furthermore, the report analyzes the cumulative installed capacity addition scenario of distributed generation and Y-o-Y investment potential analysis during the forecast period.

The report includes Porter’s Five Forces Model to determine the degree of competition in the distributed generation market. The report comprises a qualitative write-up on market attractiveness analysis, wherein end-users and regions have been analyzed based on attractiveness for each region. Growth rate, market size, impact strength, technology, competition, and other factors (such as environmental and legal) have been evaluated in order to derive the general attractiveness of the market.

Global Distributed Generation Market: Segmentation

The study provides a comprehensive view of the distributed energy generation systems market by segregating it into distributed energy generation by technology, by application, by end-user, and by geography segments. In terms of technology, the distributed energy generation systems market has been segmented into solar photovoltaic, CHP, wind turbine, reciprocating engines, micro turbines, and fuel cells. Based on application, the market has be classified into on-grid and off-grid segments. In terms of end-use, the market has been divided into residential, building & institutions, commercial, and industrial. These segments have been analyzed based on historic, present, and future trends.

Regional segmentation includes the current and forecast consumption of distributed energy generation systems in North America, Latin America, Europe, Asia Pacific, and Middle East & Africa (MEA). Market segmentation includes demand for consumption in all the regions, individually.

Global Distributed Generation Market: Competitive Landscape

The report covers detailed competitive outlook that includes market share, product mapping, and profiles of key players operating in the global distributed generation market. Key players profiled in the report are Alstom S.A., E.ON. SE, Caterpillar Power Plants, Siemens Energy, Doosan Fuel Cell America, Ballard Power Systems, Bloom Energy, General Electrical Power, Sharp Corporation, Enercon, Fuel Cell Energy, Rolls-Royce Power Systems, Mitsubishi Hitachi Power Systems, Americas, Inc., Capstone Turbine Corporation, and OPRA Turbines BV. Company profiles include attributes such as company overview, number of employees, brand overview, business overview, business strategies, recent/key developments, acquisitions, and financial overview (wherever applicable).

The global distributed generation market has been segmented as follows:

Distributed Generation Market – By Technology

  • Solar Photovoltaic
  • CHP
  • Wind Turbine
  • Reciprocating Engines
  • Micro Turbines
  • Fuel Cells

Distributed Generation Market – By Application

  • On-Grid
  • Off-Grid

Distributed Generation Market – By End-user

  • Residential
  • Building & Institutions
  • Commercial
  • Industrial

Distributed Generation Market – By Region

  • North America
    • U.S.
    • Canada
  • Latin America
    • Brazil
    • Mexico
    • Rest of Latin America
  • Europe
    • Germany
    • U.K.
    • France
    • Spain
    • Denmark
    • Russia
    • Netherlands
    • Rest of Europe
  • Asia Pacific
    • China
    • India
    • Japan
    • ASEAN
    • Rest of Asia Pacific
  • Middle East & Africa
    • GCC
    • South Africa
    • Rest of Middle East & Africa

Key Takeaways

  • An extensive analysis of the distributed generation market trends and shares from 2016 to 2025 to identify the market opportunities and analyze industry development
  • Technological scenario by region, value chain analysis, and a list of technology providers
  • Country wise analysis for distributed generation market
  • Key customer analysis with respect to the end-users industry
  • A list of key factors responsible for building the upcoming opportunistic roadmap for the distributed generation market at a global, regional, and country level
  • Comprehensive analysis with respect to investments, regulatory scenario, and price trends that impact the outlook of the global distributed generation market between 2016 and 2025
  • The report provides insights into market opportunities for various stakeholders in the value chain and a detailed competition landscape for key players dominating the industry to understand competition level
  • Porters’ Five Forces and SWOT analyses to make profit-oriented business decisions. They analyze the strengths and weaknesses to gain strategic position in the market.