Distributed Generation Market Analysis

Distributed Generation Market Overview:

Distributed Generation Market Size was valued at USD 226.2 Billion in 2023. The Distributed Generation market industry is projected to grow from USD 255.15 Billion in 2024 to USD 712.62 Billion by 2032, exhibiting a compound annual growth rate (CAGR) of 12.09% during the forecast period (2024 - 2032). Growing demand for clean energy generation are the key market drivers enhancing market growth.

Source: Secondary Research, Primary Research, MRFR Database and Analyst Review

Distributed Generation Market Trends

• 
  

  Growing demand for clean energy generation to boost the market growth

  
  

The distributed generation market is projected to grow at a high rate during the forecast period, mainly due to the growing demand for clean energy generation and renewable sources of energy. Governments around the world have developed attractive incentives, rewarding the use of renewable sources of energy, which further drives growth.

Governments all around the world have devised enticing incentives to encourage the adoption of renewable energy sources, hence accelerating growth. The market is growing as people become more aware of clean energy resources. The industry is being driven by the rising demand for distributed generation due to environmental benefits and the lower cost compared to traditional energy generation.

One or more power stations are situated close to the load in decentralized generating, which is a decentralized and relatively flexible technology. Each power station has a capacity of around 10 megawatts, and these systems can include numerous generation and storage locations. Distributed generation is made up of a variety of energy sources, most of which are renewable. Solar, wind, fuel cells, hydro, biogas, biomass, and geothermal power are all examples of renewable energy sources. Decentralized generating can assist in delivering reliable and clean energy to users while decreasing transmission losses. The centralized system currently dominates the electricity distribution system. However, it is expected that there would be significant growth, owing primarily to developed economies.

Distributed Generation Market Segment Insights:

Distributed Generation Technology Insights

The Distributed Generation market segmentation, based on technology, includes Geothermal, Solar, Wind, Biogas, Fuel Cells, and Others. The solar segment held the majority share 2021 of the Distributed Generation market revenue. The solar segment is leading the market and has the largest market share, mainly due to the less cost involved in setting up the system for both, commercial and residential use.

Distributed Generation Application Insights

The Distributed Generation market segmentation, based on aplication, includes On-Grid and Off-Grid. The On-Grid segment held the majority share 2021 of the Distributed Generation market revenue. On-grid segment dominates the market in this sector as on-grid systems are very cost-effective and simple systems.

Distributed Generation End User Insights

Based on end users, the Distributed Generation market segmentation includes residential, commercial, and industrial. The commercial segment dominated the market in 2021 and is projected to be the faster-growing segment during the forecast period, 2022-2030. This is attributed to the increased government initiatives to promote the adoption of renewable energy sources across the commercial and industrial sectors in the form of subsidies and incentives. Moreover, the reduced equipment costs and increased demand for uninterrupted power supply have fostered the growth of this segment. Moreover, the increased efforts of the government to industrialize and urbanize the rural regions are supporting the growth of the commercial & industrial segment, and hence this segment is expected to dominate throughout the forecast period. these all factors for Distributed Generation positively impact market growth.

Figure 2: Distributed Generation Market, by Application, 2024 & 2032 (USD Billion)

Source: Secondary Research, Primary Research, MRFR Database and Analyst Review

Distributed Generation Regional Insights

By region, the study provides market insights into North America, Europe, Asia-Pacific, and the Rest of the World. The Asia-Pacific Distributed Generation market is expected to exhibit a significant CAGR growth during the study period. This is simply attributed to the increased adoption of renewable energy sources, rising investments in industrialization and urbanization, rapidly growing infrastructural developments, and increasing government initiatives to encourage the deployment of renewable and green & clean energy sources. Moreover, with the growing industrialization, the demand for an efficient and uninterrupted power supply is growing significantly, which is fueling the growth of the distributed generation market in the Asia Pacific.

Further, the major countries studied in the market report are The U.S., Canada, Germany, France, the UK, Italy, Spain, China, Japan, India, Australia, South Korea, and Brazil

Figure 3: Distributed Generation Market Share By Region 2021 (%)

Source: Secondary Research, Primary Research, MRFR Database and Analyst Review

Europe’s Distributed Generation market accounts for the largest market share. Europe accounts for the largest market share. Europe has over 100 geothermal stations installed, which produced about 15 TWh of electrical power. Further, the German Distributed Generation market held the largest market share, and the UK Distributed Generation market was the fastest-growing market in the European region.

In North America, Distributed Generation market holds the second-largest share in the geothermal segment. The huge demand for wind energy in North America and the rapidly growing demand for solar energy across commercial and industrial units is expected to fuel the demand for distributed generation technologies. Moreover, the U.S. Distributed Generation market held the largest market share, and the Canadian Distributed Generation market was the fastest-growing market in the Asia-Pacific region.

Distributed Generation Key Market Players & Competitive Insights

Major market players are spending a lot of money on R&D to increase their product lines, which will help the Distributed Generation market grow even more. Market participants are also taking a range of strategic initiatives to grow their worldwide footprint, with key market developments such as new product launches, contractual agreements, mergers and acquisitions, increased investments, and collaboration with other organizations. Competitors in the Distributed Generation industry must offer cost-effective items to expand and survive in an increasingly competitive and rising market environment.

The major market players are investing a lot of money in R&D to expand their product lines, which will spur further market growth for Distributed Energy Generation. With significant market development like new product releases, contractual agreements, mergers and acquisitions, increased investments, and collaboration with other organizations, market participants are also undertaking various strategic activities to expand their presence. To grow and thrive in a market climate that is becoming more competitive and growing, competitors in the Distributed Generation industry must offer affordable products.

Manufacturing locally to cut operating costs is one of the main business tactics manufacturers use in the Distributed Generation industry to benefit customers and expand the market sector. The Distributed Power Generation market has recently given medicine some of the most important advantages. Major hair care product market players, including General Electric Company, Ansaldo Energia, Bloom Energy, Schneider Electric SE, Caterpillar Inc., Siemens AG, Mitsubishi Heavy Industries Ltd, Fuel Cell Energy Inc, Cummins Inc, Bergey Windpower, and others, are attempting to increase market demand by funding R&D initiatives.

General Electric (GE) is a multinational conglomerate corporation headquartered in Boston, Massachusetts. The company operates in various industries, including aviation, power, renewable energy, healthcare, transportation, and oil and gas. GE was founded in 1892 by Thomas Edison and is one of the oldest companies listed on the Dow Jones Industrial Average. The company has a diverse portfolio of products and services, including aircraft engines, power generation equipment, medical imaging equipment, and wind turbines. GE has been recognized as one of the world's most valuable brands, and it operates in over 180 countries.

Schneider Electric is a multinational corporation that specializes in energy management and automation solutions. The company offers a wide range of products and services, including electrical distribution, industrial automation, building automation, and renewable energy solutions. Schneider Electric operates in over 100 countries and serves customers in a variety of industries, including utilities, infrastructure, and buildings. The company was founded in 1836 and is headquartered in France.

Key Companies in the Distributed Generation market includes

• General Electric Company


• Ansaldo Energia


• Bloom Energy


• Schneider Electric SE


• Caterpillar Inc.


• Siemens AG


• Mitsubishi Heavy Industries Ltd


• Fuel Cell Energy Inc


• Cummins Inc


• Bergey Windpower among others

Distributed Generation Industry Developments

The grid-connected rooftop solar scheme, Phase 2, began in December 2022, with solar panel installation as its main target. The Union Ministry of New and Renewable Energy has directed that 10 MW capacity be installed.

A total of 3,709 customers were added to Michigan’s distributed generation program in November 2022, which increased by 37%, raising the total number to 14,262 with 14,446 installations. Customers can generate their own electricity mainly from solar projects, hence reducing domestic power bills through this project.

In October 2022, National Renewable Energy Laboratory announced the “Distributed Generation Market Demand” model and then felt persuaded that its newest version could be opened on the GitHub site.

In May 2022, Enrique Razon, a Philippine billionaire businessman, unveiled plans to team up with many local companies towards building the largest solar-powered plant globally. This was disclosed by an arm of infrastructure investment owned by Enrique Razon.

In June 2022, Israel's Finance Ministry and IIA (Israel Innovation Authority) launched a solar initiative to evaluate it, while an artificial intelligence (AI) floating system is designed to generate electricity through sun tracking.

Brazil’s largest fixed-line carrier, Oi SA, introduced a renewable energy project in April 2022 that is expected to reduce operating cost by BRL400m. It is anticipated that this project will entail twenty-five hydroelectricity mills/solar/biomass having a capacity of one hundred twenty-three megawatts.

The NREL (National Renewable Energy Laboratory) released the Distributed Generation Market Demand (dGenTM) model for the year 2021 in October last year. The company also noted that users can now access the latest version of the model on dGen GitHub.

Oi SA, Brazil's biggest fixed-line carrier, declared a renewable energy project in April 2021 during which time it aimed at cutting down operating costs by BR400 million reais. This indicates that there are planned twenty-five hydroelectric mills, solar and biomass of one hundred twenty-three megawatts in capacity.

Distributed Generation Market Segmentation

Distributed Generation Technology Outlook

• Geothermal


• Solar


• Wind


• Biogas


• Fuel Cells


• Others

Distributed Generation Application Outlook

• On-Grid


• Off-Grid

Distributed Generation End User Outlook

• Residential


• Industrial


• Commercial

Distributed Generation Regional Outlook

• North America
  
  
  
  • US
  
  
  • Canada
  
  
  
  


• Europe
  
  
  
  • Germany
  
  
  • France
  
  
  • UK
  
  
  • Italy
  
  
  • Spain
  
  
  • Rest of Europe
  
  
  
  


• Asia-Pacific
  
  
  
  • China
  
  
  • Japan
  
  
  • India
  
  
  • Australia
  
  
  • South Korea
  
  
  • Australia
  
  
  • Rest of Asia-Pacific
  
  
  
  


• Rest of the World
  
  
  
  • Middle East
  
  
  • Africa
  
  
  • Latin America