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    Microgrid Market

    ID: MRFR/E&P/1645-HCR
    188 Pages
    Chitranshi Jaiswal
    September 2025

    Microgrid Market Research Report Information By Type (Grid Connected & Off-Grid), By Component (Hardware, Software, & Services), By Power Source (Natural Gas, Solar PV, Diesel, Fuel Cell), By End-Use (Industrial, Healthcare), And By Region (North America, Europe, Asia-Pacific, And Rest Of The World) – Market Forecast Till 2032

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    Microgrid Market Summary

    As per Market Research Future Analysis, the Global Microgrid Market was valued at USD 32.35 Billion in 2023 and is projected to reach USD 142.28 Billion by 2032, growing at a CAGR of 17.89% from 2024 to 2032. The increasing demand for secure and reliable power supply is a key driver of this growth. The market is characterized by a significant shift towards renewable energy sources, with solar PV leading the power source segment. The Asia-Pacific region is expected to dominate the market due to rapid industrialization and urbanization, particularly in China and India.

    Key Market Trends & Highlights

    The Microgrid Market is witnessing transformative trends driven by technological advancements and environmental concerns.

    • Microgrid Market Size in 2023: USD 32.35 Billion.
    • Projected Market Size by 2032: USD 142.28 Billion.
    • CAGR from 2024 to 2032: 17.89%.
    • Grid Connected segment held ~30% of market revenue in 2021.

    Market Size & Forecast

    2023 Market Size USD 32.35 Billion
    2024 Market Size USD 37.6 Billion
    2032 Market Size USD 142.28 Billion
    CAGR (2024-2032) 17.89%

    Major Players

    Key players include ABB, GE, Eaton, Schneider Electric, Honeywell, Caterpillar, S&C Electric, Power Analytics Corporation, Siemens, and Microgrid Energy.

    Microgrid Market Trends

      • The Adoption of Smart Grids Initiatives is Encouraged by the Growing Need for Clean Energy

    To fulfill the objectives of the smart grid project, future electrical networks must be adaptable, accessible, dependable, and financially feasible. Research on alternative microgrid topologies or designs is focusing more on controlling equipment failure as a result of growing attempts to reduce greenhouse gas (GHG) emissions. Growing environmental concerns and the use of renewable energy are also opening up lucrative industry opportunities.

    The Global Microgrid Market is poised for robust growth as decentralized energy systems increasingly demonstrate their resilience and adaptability in meeting diverse energy needs.

    U.S. Department of Energy

    Microgrid Market Drivers

    Market Growth Projections

    The Global Microgrid Market Industry is projected to experience substantial growth in the coming years. With a market value expected to reach 37.6 USD Billion in 2024 and an impressive forecast of 233.1 USD Billion by 2035, the industry is on a trajectory of rapid expansion. The anticipated compound annual growth rate (CAGR) of 18.04% from 2025 to 2035 underscores the increasing investment and interest in microgrid technologies. This growth is likely to be fueled by various factors, including technological advancements, government support, and the rising demand for renewable energy solutions. The market's evolution reflects a broader shift towards sustainable and resilient energy systems.

    Decentralization of Energy Systems

    The trend towards decentralization of energy systems is reshaping the Global Microgrid Market Industry. As consumers seek greater control over their energy sources, decentralized microgrid solutions are gaining traction. This shift allows communities to generate, manage, and consume energy locally, reducing reliance on centralized power plants. For instance, community-based microgrids in rural areas are empowering residents to harness local resources, such as solar energy. This decentralization not only enhances energy independence but also fosters economic development within communities. As this trend continues, the Global Microgrid Market is poised for substantial growth, driven by the increasing adoption of decentralized energy solutions.

    Government Initiatives and Funding

    Government initiatives and funding play a crucial role in the expansion of the Global Microgrid Market Industry. Many governments are implementing policies and providing financial incentives to promote the development of microgrid systems. For example, the U.S. Department of Energy has launched various programs aimed at supporting microgrid research and deployment. Such initiatives not only facilitate the integration of microgrids into existing energy infrastructures but also encourage private sector investment. This supportive regulatory environment is expected to propel the market forward, with projections suggesting that the Global Microgrid Market could reach 233.1 USD Billion by 2035.

    Rising Demand for Renewable Energy

    The Global Microgrid Market Industry is experiencing a notable surge in demand for renewable energy sources. As nations strive to meet climate goals, the integration of solar, wind, and other renewables into microgrid systems is becoming increasingly prevalent. For instance, countries like Germany and India are investing heavily in microgrid projects that utilize renewable energy, which not only reduces carbon emissions but also enhances energy security. This trend is expected to contribute to the market's growth, with projections indicating that the Global Microgrid Market could reach 37.6 USD Billion in 2024, reflecting a growing commitment to sustainable energy solutions.

    Increasing Energy Resilience and Security

    The need for enhanced energy resilience and security is driving the Global Microgrid Market Industry. As natural disasters and extreme weather events become more frequent, the ability of microgrids to operate independently from the main grid is increasingly valued. Microgrids provide localized energy solutions that can maintain power supply during outages, thereby ensuring critical services remain operational. This resilience is particularly important for essential facilities such as hospitals and emergency services. Consequently, the demand for microgrid systems is expected to rise, contributing to the overall growth of the market as stakeholders prioritize energy security.

    Technological Advancements in Energy Storage

    Advancements in energy storage technologies are significantly influencing the Global Microgrid Market Industry. Innovations in battery technologies, such as lithium-ion and flow batteries, are enhancing the efficiency and reliability of microgrid systems. These developments allow for better energy management, enabling microgrids to store excess energy generated from renewable sources for later use. As a result, microgrids can operate more effectively, particularly in remote or off-grid areas. The increasing adoption of these technologies is likely to drive market growth, with expectations that the Global Microgrid Market will expand at a CAGR of 18.04% from 2025 to 2035.

    Market Segment Insights

    Microgrid Type Insights

    The market segmentation, based on type, includes Grid Connected, and Off-Grid. The Grid Connected segment held the majority share in 2021, contributing to around ~30% of the Microgrid market revenue. Grid-connected microgrids are made up of several generators, distribution networks, and sophisticated controllers. These technologies offer a variety of other benefits, which enhance demand, in addition to enhancing grid resilience, ensuring electricity quality, and lowering their environmental effect.

    Microgrid Component Insights

    Based on Components, the market segmentation includes Hardware, Software, and Services. The Hardware segment dominated the market in 2021. Microgrid hardware consists of power producers, energy storage devices, and controllers. Several reasons are driving the expansion of the hardware market, including an increase in the number of microgrid projects globally, lower energy storage prices, and an increase in the number of government programs to encourage renewable energy and reduce greenhouse gas emissions.

    Microgrid Power Source Insights

    Based on Power Sources, the market segmentation includes Natural Gas, Solar PV, Diesel, and Fuel Cell. The Solar PV segment dominated the market in 2021 with market growth. Due to its adaptability and abundance, natural gas has a substantial market share and microgrid power systems with very little environmental effect. The ample supply of natural gas and its adaptability to a wide range of uses are driving up demand for solar PV globally.

    Microgrid End-Use Insights

    Based on End-Use, the market segmentation includes Industrial, Healthcare. The Industrial segment dominated the market in 2021 the market growth. The continual necessity for uninterrupted power supply to ensure smooth operations throughout industrial activities to decrease downtime, boost productivity, and prevent equipment damage has contributed to the expansion of this market sector. Government measures to encourage the usage of renewable energy and reduce greenhouse gas (GHG) emissions are also driving the expansion of the market for commercial and industrial end-users.

    Source Secondary Research, Primary Research, Market Research Future Database, and Analyst Review

    Get more detailed insights about Microgrid Market Research Report - Forecast to 2032

    Regional Insights

    By region, the study provides market insights into North America, Europe, Asia-Pacific, and the Rest of the World. In 2021, Asia Pacific led the market. This is mostly caused by the area's low electrification rate, poor grid connectivity, and high electricity demand. It is predicted that the Asia Pacific market would grow significantly during the forecast period, largely as a result of the region's quick industrialization and urbanization, particularly in China and India. Additionally, governments in Asia-Pacific nations intend to support distributed energy generation and microgrids to provide electricity to their citizens.

    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 Microgrid Market Share By Region 2021 (%)

    MICROGRID MARKET SHARE BY REGION 2021

    Source Secondary Research, Primary Research, Market Research Future Database, and Analyst Review

    Key Players and Competitive Insights

    Major market players are spending a lot of money on R&D to increase their product lines, which will help the market grow even more. Market participants are also taking various 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 Microgrid industry must offer cost-effective items to expand and survive in an increasingly competitive and rising market environment.

    Manufacturing locally to cut operating costs is one of the main business tactics manufacturers use in the Microgrid industry to benefit customers and expand the market sector. The market has recently given medicine some of the most important advantages. Major market players, including ABB, GE, Eaton, Schneider Electric, Honeywell, and others, are attempting to increase market demand by funding R&D initiatives.

    ABB is a corporation that offers industrial clients electrification, automation, robotics, and digitalization solutions. It has four primary businesses Electrification, Process Automation, Motion, Robotics, and Discrete Automation. The Electrification division provides modular substation packages, distribution automation products, switchgear, circuit breakers, measuring and sensing devices, control products, solar power solutions, EV charging infrastructure, wiring accessories, and enclosures and cabling systems. The Process Automation division offers turnkey engineering, control technologies, software and lifecycle services, measurement and analytics solutions, marine and turbocharging options, human-machine interfaces (HMI), and integrated safety technology. The Motion division provides electrical motors, generators, and mechanical power transfer devices.

    The Robotics and Discrete Automation division provides industrial robots, software, application solutions, engineering systems, and related services.

    Also, An intelligent power management firm is Eaton. Electrical Americas, Electrical Global, Hydraulics, Aerospace, Vehicles, and eMobility are its five business segments. The electrical and industrial components, residential products, power quality, fire detection, wiring devices, structural support systems, circuit protection, lighting products, power distribution and assemblies, hazardous duty electrical equipment, safe explosion-proof instrumentation, power reliability equipment, and services are all provided by the electrical Americas and electrical segments. For mobile and industrial equipment, the hydraulics segment provides hydraulics components, systems, and services. For both commercial and governmental purposes, the aerospace section provides fuel, hydraulics, and pneumatic systems.

    The drivetrain, powertrain systems, and other vital parts for automobiles, light trucks, and commercial vehicles are the focus of the category for vehicles.

    Key Companies in the Microgrid Market market include

    Industry Developments

    • Q1 2025: Enchanted Rock Partners with Texas Utilities for $1.8 Billion Microgrid Backup Power Initiative In January 2025, Texas invested $1.8 billion to construct backup power solutions, including microgrids, with Enchanted Rock teaming up with utilities to enhance grid reliability and resilience following recent severe weather events.

    Future Outlook

    Microgrid Market Future Outlook

    The Global Microgrid Market is projected to grow at an 18.04% CAGR from 2024 to 2035, driven by technological advancements, regulatory support, and increasing demand for energy resilience.

    New opportunities lie in:

    • Develop integrated energy management systems for enhanced efficiency.
    • Invest in renewable energy sources to diversify microgrid portfolios.
    • Create partnerships with local governments for community-based microgrid projects.

    By 2035, the market is expected to be robust, reflecting substantial growth and innovation.

    Market Segmentation

    Microgrid Type Outlook

    • Grid Connected
    • Off-Grid

    Microgrid End-Use Outlook

    • Industrial
    • Healthcare

    Microgrid Regional Outlook

    North America
    • US
    • Canada

    Microgrid Component Outlook

    • Hardware
    • Software
    • Services

    Microgrid Power Source Outlook

    • Natural Gas
    • Solar PV
    • Diesel
    • Fuel Cell

    Report Scope

    Attribute/Metric Details
    Market Size 2023 USD 32.35 Billion
    Market Size 2024 USD 37.6 Billion
    Market Size 2032 USD 142.28 Billion
    Compound Annual Growth Rate (CAGR) 17.89% (2024-2032)
    Base Year 2023
    Market Forecast Period 2024-2032
    Historical Data 2018 & 2022
    Market Forecast Units Value (USD Billion)
    Report Coverage Revenue Forecast, Market Competitive Landscape, Growth Factors, and Trends
    Segments Covered Type, Component, Power Source, End-Use, and Region
    Geographies Covered North America, Europe, Asia Pacific, and Rest of the World
    Countries Covered The U.S, Canada, Germany, France, UK, Italy, Spain, China, Japan, India, Australia, South Korea, and Brazil
    Key Companies Profiled ABB, GE, Eaton, Schneider Electric, Honeywell, Caterpillar, S&C Electric, Power Analytics Corporation, Siemens, Microgrid Energy
    Key Market Opportunities Growing demand for microgrids in Healthcare, Military, and Government sectors Increasing government investment in microgrid projects
    Key Market Dynamics Increasing demand for secure and reliable power supply Advantages of clean energy storage Government initiatives to reduce carbon footprint

    Market Highlights

    Author
    Chitranshi Jaiswal
    Research Analyst Level I

    In her 3 years of experience in the market research field, she has handled critical cross-domain projects. She has an in-depth knowledge of market estimation & analysis, problem-solving, primary as well as secondary research, and team management.She holds an engineering degree and is an MBA professional from a well-known university, capable of evaluating the market and competitive conditions. An exceptional strategist with excellent communication skills and a passion for delivering cutting-edge & practical insights for the market. Proficient in multi-tasking, and can successfully deal with competing demands, while maintaining complete confidentiality. Generated business through active client and project development, networking, and high-quality responses. Her knowledge and skills have helped in making solid business decisions, securing funding from investors, and avoiding business failures.

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    FAQs

    How much is the Microgrid market?

    The Microgrid market size was valued at USD 32.35 Billion in 2023.

    What is the growth rate of the Microgrid market?

    The market is projected to grow at a CAGR of 17.89% during the forecast period, 2024-2032.

    Which region held the largest market share in the Microgrid market?

    Asia Pacific had the largest share of the Microgrid market.

    Who are the key players in the Microgrid market?

    The key players in the market are ABB, GE, Eaton, Schneider Electric, Honeywell, Caterpillar, S&C Electric, Power Analytics Corporation, Siemens, and Microgrid Energy.

    Which type led the Microgrid market?

    The Grid Connected category dominated the market in 2021.

    Which End-Use had the largest market share in the market?

    The Industrial had the largest share in the market for Microgrid.

    Microgrid Market Research Report - Forecast to 2032 Infographic
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