Global Genset Market Overview
Genset Market Size was valued at USD 39,645.60 Million in 2022. The Genset Market industry is projected to grow from USD 41,723.88 Million in 2023 to USD 68,351.10 Million by 2032, exhibiting a compound annual growth rate (CAGR) of 5.64 % during the forecast period (2023 - 2030).
Generator is a device which converts mechanical energy into electrical energy. It consists of a magnetic field, an armature, slip rings, brushes and a resistive load. The major type of generators are gas and diesel generators. Electricity has become a vital prerequisite for augmenting economic activity and improving quality of life. The growing demand for uninterrupted and reliable power supply has become a necessity in today’s world. Thus, to support this growing need, a reliable source of power generation is required. Generator sets provide a continuous, prime and standby source of power generation at industrial, commercial and residential level.
In the last decade, several technological advancements have helped upgrading generator sets which have improved their fuel efficiency, subsequently their diesel engine technology. Diesel engines have emerged as preferred choice among enterprises owing power backup equipment. The easy availability of diesel generators and their affordable price have fueled their demand in turn positively impacting the global generator market. Also, numerous modifications are made in fuel systems, besides incorporating control and digital monitoring system. These changes have upgraded diesel generators. They now offer higher performance efficiency, which is a key factor boosting the utilization of generator sets globally.
Source: Secondary Research, Primary Research, MRFR Database and Analyst Review
Increasing number of power outages
Power outages have severe economic and social repercussions on communities across the world. The increasing reliance of society on energy limits tolerance for power outages, emphasizing the need to strengthen power system resilience against natural disasters. Longer—and potentially life-threatening—blackouts are becoming a greater hazard as natural catastrophes grow more common and severe as a result of climate change.
Extreme weather events accounted for 1.33 billion outage hours in 2020, a 70% increase over 2019. According to the U.S. Energy Information Administration, the average duration of annual electric power interruption stood at 7 hours from 2017 to 2021 in US. Additionally, according to the Department of Energy, power outages cost U.S. economy USD 28 billion to USD 169 billion annually.
Source: U.S. Energy Information Administration and MRFR Analysis
According to the U.S. Energy Information Administration, the average duration of annual electric power interruption stood at 7 hours from 2017 to 2022. Electric utility companies in the U.S. are confronted with a significant obstacle in the form of escalating maintenance expenses associated with aging infrastructure. Approximately 70 percent of transmission lines in the U.S. are more than 25 years old and nearing the end of their typical 50-80 year lifespan. As time passes, various components of the infrastructure, such as transmission towers, transformers, and power lines, undergo deterioration, resulting in frequent breakdowns and power outages. Thus, the growing power outages are anticipated to result in an increase in demand for gensets over the forecast period.
Furthermore, India is the world's third largest energy consumer, with coal meeting the majority of its energy needs. India is facing a power crisis because coal supplies in certain states are rapidly depleting, amid rising demand for electricity. According to the Government Advisory Body of India, India will need up to 28 gigawatts (GW) of new coal-fired power plants by 2032 to meet the demand for electricity, which is expected to more than double from the current 404.1 GW in 2023. The power ministry has invoked emergency provisions, directing all imported coal-based (ICB) power plants to run at full capacity to meet the growing power demand.
Rising demand for uninterrupted & reliable power supply
With rapid industrialization and growing power consumption, the need for uninterrupted power supply is also rapidly growing in the market. According to the International Energy Administration, the electricity demand is anticipated to grow at a faster rate of 3% per year from 2023-2025 compared to the 2022 growth rate. A continuous power supply is the baseload electricity required to run a predefined set of electrical equipment. The baseload electricity supply must be always maintained and is the minimum amount of electricity an end user’s facility will need to successfully operate the equipment and systems at the facility.
Many end user facilities generate their base load power supply through gensets due to various factors such as the inaccessible grid electricity and the intermittent nature of grid connected electricity. For instance, end users who use diesel or natural gas fuel-based generators for oil & gas and mining applications mostly operate in remote areas and generate their base load electricity through these generators.
Moreover, the need for an uninterruptible power supply from various end-users, including the utility and power generating, chemical, oil & gas, residential, IT/telecom, healthcare, agriculture, mining, and construction industries is driving the demand for gensets to meet their demand. For instance, hospitals, clinics, and medical facilities require continuous power supply to ensure the seamless operation of life-saving equipment, such as ventilators, life support systems, and diagnostic machines.
A power outage in a healthcare setting can have severe consequences, endangering patients' lives and compromising the ability of medical professionals to provide timely care. Gensets serve as crucial backup power sources, ensuring that healthcare facilities can continue to function even during power disruptions.
Genset Market Segment Insights
Genset Portability Insights
The Genset Market segmentation, based on portability, includes stationary and portable. The stationary segment held the majority share in 2023. The stationary segment accounts for 87.6 market share in Genset Market. The constant standby genset meets the strict and immediate power needs of enterprises. In the event of a power loss, this device can be manually or even automatically started because it is hardwired into the main distribution panel.
An automatic transfer switch isolates the electrical wiring from the utility grid in the event of a power outage and activates the genset. The genset starts supplying the lines with electricity. When the electricity comes back on, the process is reversed, the genset is put into standby mode, and the incoming feed is obtained through utility lines.
Genset Fuel Insights
The Genset Market data has been bifurcated by fuel largely into diesel, natural gas and CNG. The diesel segment dominated the market in 2023. Diesel genset can be used as a backup in a power outage or to supply electricity to locations not connected to the power grid. Ships also use diesel genset for propulsion and as a source of energy. Diesel genset are very popular as auxiliary power sources for emergency power supply.
Diesel genset can be utilized in both single-phase and three-phase, making them suitable for usage in homes, small workplaces, and large organizations. Numerous benefits of diesel genset include their dependable operation, high efficiency, decreased maintenance costs, ability to operate under heavy loads, and other aspects. Additionally, the manufacturing, healthcare, oil and gas, maritime, and IT/telecom industries also use diesel genset extensively.
Genset End User Insights
The Genset Market data has been bifurcated by end user largely into industrial, commercial and residential. The commercial segment dominated the market in 2023. Due to the service sector's rapid growth, which is anticipated to continue during the projection period, the commercial segment will be the largest market. During business hours, genset are mostly employed in the commercial sector to ensure a continuous power supply. Hospitals, lodging, dining, telecommuting hubs, and banking and insurance companies are part of the service industry.
Genset Power Rating Insights
The Genset Market data has been bifurcated by power rating largely into up to 100KVA, 100-350 KVA, 350-1000KVA, and above 1000KVA. The 350-1000KVA segment dominated the market in 2023. Due to escalating demand from the commercial, telecom & IT, and real estate markets, the segment is growing. Houses and businesses typically do not have significant power-consuming machinery like industries do. As a result, the demand for genset with a power rating of 350–1000 kVA is anticipated to be larger than that of genset with other power ratings.
Additionally, the demand for these gensets in the Indian diesel Genset market is anticipated to be supported by elements like investments in the telecom sector and an increase in the installation of tower towers for connectivity in remote locations, combined with improvements in current network capabilities.
Genset Application Insights
The Genset Market data has been bifurcated by application largely into agriculture, construction, forestry, industrial, pumps and Power generation. The construction segment dominated the market in 2023, holding the market share of 4.8%. In the construction segment, Gensets play a vital role in powering heavy machinery and equipment essential for construction activities.
This includes backhoes for digging and excavating, bore/drill rigs for drilling operations, excavators for earthmoving tasks, forklifts for material handling, rollers and graders for road construction, skid steer loaders for versatile on-site tasks, and wheel loaders and dozers for moving materials and shaping terrain. Additionally, Gensets are integral to forestry equipment such as chippers, fellers, harvesters, loaders, skidders, and swing machines, which are used in logging and timber operations.
Genset Region Insights
By Region, the Genset Market industry study segments the market into North America, Europe, Asia-Pacific and Rest of The World. Asia-Pacific Genset Market accounted for USD 1,052.02 million in 2023 and is expected to exhibit a 4.33% CAGR during the study period. This is attributed to the presence of growing population and emerging market in the region.
The Asia Pacific genset market has undergone substantial growth and transformation in recent years, fueled by various socio-economic and technological factors. With a diverse landscape spanning countries like China, India, Japan, South Korea, and ASEAN nations, the region exhibits a mix of mature and emerging markets, each with its own dynamics and growth drivers.
One significant driver of the genset market in the Asia Pacific region is the increasing demand for reliable power supply across industries and applications. With rapid urbanization and industrialization, there is a growing need for uninterrupted electricity to sustain economic activities and support critical infrastructure. Gensets play a vital role in providing backup power during grid failures or in areas with unreliable electricity supply, thus ensuring continuity of operations for various sectors including manufacturing, healthcare, telecommunications, and commercial establishments.
The adoption of cleaner and more efficient genset technologies is emerging as a key trend in the Asia Pacific market, driven by environmental regulations and sustainability initiatives. Governments and regulatory bodies across the region are implementing stricter emissions standards, prompting industries to transition towards gas-powered and hybrid gensets.
Natural gas gensets, in particular, are gaining traction due to their lower emissions profile and cost-effectiveness compared to traditional diesel gensets. According to industry analysis, natural gas gensets accounted for over 30% of the Asia Pacific genset market share in 2020 and are expected to witness significant growth in the coming years.
Genset Key Market Players & Competitive Insights
Major market players’ growth depends on market conditions, government support, and industry development. Thus, the vendors should focus on expanding geographically and improving services. Many global, regional, and local vendors characterize the Genset market. The market is highly competitive, with all the players competing to gain market share. Intense competition, rapid advances in technology, frequent changes in government policies, and environmental regulations are key factors that confront market growth.
The vendors compete based on cost, product quality, reliability, and government regulations. Vendors must provide cost-efficient, high-quality products to survive and succeed in an intensely competitive market.
Cummins Inc (Cummins) is a firm that specializes in power technologies. It develops, manufactures, and sells diesel and natural gas engines and power train components. The company's products include air handling systems, after-treatment, fuel systems, control systems, turbochargers, filtration, electric power generating systems, transmissions, batteries, and electrified power systems.
Cummins sells to original equipment manufacturers, dealers, distributors, and other businesses. Its services consumers in various industries across North America, Europe, Asia Pacific, and South Pacific. Worldwide, the corporation has distribution, manufacturing, and other facilities. Cummins is based in Columbus, Indiana, in the United States.
Caterpillar Inc (Caterpillar) is a construction, transportation, and energy equipment producer. Construction and mining equipment, industrial gas turbines, forestry equipment, diesel-electric locomotives, and diesel and natural gas engines are all designed, manufactured, marketed, and sold by the company. The company offers asphalt pavers, backhoe loaders, compactors, draglines, integrated systems, reciprocating engines, and other products. Customers and dealers can now get retail and wholesale financing for Caterpillar goods from Caterpillar. Through its subsidiaries and dealers, the company markets and distributes its products across North and South America, Asia-Pacific, Africa, the Middle East, and Europe.
Key Companies in the Genset Market include:
- Cummins Inc.
- Caterpillar, Inc.
- Aggreko, Generac Holdings Inc.
- Kohler Co.
- Atlas Copco
- John Deere
- MTU Onsite Energy
- Wartsila
- Yanmar Co. Ltd.
- Himoinsa S.L.
- Kirloskar Electric Company Limited
Genset Industry Developments
August 2021: Caterpillar Inc. unveiled the Cat® G3412 natural gas-powered generator set with US EPA Stationary Emergency Certification rated at 500 kW for 60 Hz markets. The G3412 is designed to meet many important market requirements, including rapid starting and loading, NFPA 110 Level 1 Type 10 compliance, and UL 2200 listing.
Genset Market Segmentation
Genset Market Portability Outlook (USD Million, 2018-2032)
Genset Market Fuel Outlook (USD Million, 2018-2032)
Genset Market End User Outlook (USD Million, 2018-2032)
- Industrial
- Commercial
- Residential
Genset Market Power Rating Outlook (USD Million, 2018-2032)
- Up to 100KVA
- 100-350KVA
- 350-1000KVA
- Above 1000 KVA
Genset Market Application Outlook (USD Million, 2018-2032)
- Agriculture
- Construction
- Forestry
- Industrial
- Pumps
- Power Generation
Genset Regional Outlook
- North America
- Europe
- Germany
- France
- UK
- Italy
- Spain
- Rest of Europe
- Asia-Pacific
- China
- Japan
- India
- South Korea
- Rest of Asia-Pacific
- Rest of the World
- Middle East & Africa
- South America
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Attribute/Metric
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Details
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Market Size 2023
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USD 41,723.88 Million
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Market Size 2024
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USD 43,947.60 Million
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Market Size 2032
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USD 68,351.10 Million
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Compound Annual Growth Rate (CAGR)
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5.64 % (2018-2032)
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Base Year
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2022
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Forecast Period
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2023-2032
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Historical Data
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2018 – 2021
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Forecast Units
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Value (USD Million)
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Report Coverage
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Revenue Forecast, Competitive Landscape, Growth Factors, and Trends
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Segments Covered
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Portability, Fuel, End User, Power Rating and Application
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Geographies Covered
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North America, Europe, Asia Pacific and Rest Of The World
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Countries Covered
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The U.S, Canada, Germany, France, UK, Italy, Spain, China, Japan, India, Australia, South Korea, and, rest of the world
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Key Companies Profiled
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Cummins Inc., Caterpillar, Inc., Aggreko, Generac Holdings Inc., Kohler Co., Atlas Copco, John Deere, MTU Onsite Energy, Wartsila, Yanmar Co. Ltd., Himoinsa S.L., and Kirloskar Electric Company Limited
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Key Market Opportunities
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· Increasing number of power outages
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Key Market Dynamics
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· Rising need for uninterrupted & reliable power supply
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Genset Market Highlights:
Frequently Asked Questions (FAQ) :
As of 2023, Genset is worth USD 41,723.88 million.
The Genset Market is growing at a CAGR of 5.64 %.
The Asia-Pacific region holds the largest market share in the Genset market.
Cummins Inc., Caterpillar, Inc., Aggreko, Generac Holdings Inc., Kohler Co., Atlas Copco, John Deere, MTU Onsite Energy, Wartsila, Yanmar Co. Ltd., Himoinsa S.L., and Kirloskar Electric Company Limited are some of the prominent players in the market.
The diesel segment in the Genset Market is leading market growth.
The commercial segment has the largest market share.
