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Decentralized Power Generation Market Size
Decentralized Power Generation Market is projected to exhibit notable growth rate between 2024 and 2032, driven by increasing investments in smart grids and the growing number of power generation resources. As per an International Energy Agency (IEA) report, investment in smart grids is likely to more than double up to 2030 to move ahead in the Net Zero Emissions by 2050, particularly in developing economies. Modifications in the grid structure that permits decentralization of power and electricity generation would also fuel the product demand.
The growing need for power has been prompting several companies to raise their output to meet the consumer demands. Decentralized power generation offers the benefit of being independent on a single power station to cater to the needs of a whole region. The ongoing expansion in several power intensive industries is also set to reflect positively on the demand for decentralized power generation over the next ten years. However, high initial investment costs, regulatory barriers, grid integration challenges, and limited technological infrastructure in some regions may restrain the industry expansion to a certain extent.
Decentralized Power Generation Market Trends
According to a latest report of IAE, renewable energy capacity added to global energy systems surged by 50% in 2023, reaching nearly 510 gigawatts (GW). This rising trend of renewable energy, such as the solar or wind energy, may prompt the demand for decentralized power generation systems. Energy storage solutions like batteries are also gaining prominence for enabling greater flexibility and reliability in decentralized systems.
Moreover, microgrids are becoming increasingly popular, especially in remote or off-grid areas for offering localized power generation and distribution. Significant developments in digitalization and smart grid technologies are enhancing the efficiency and management of decentralized power systems for empowering consumers to participate actively in energy generation and consumption decisions. A recent IEA report suggests that digital technologies may conserve approximately USD 1.8 trillion in global grid investments till 2050, by increasing grid lifespan.
Decentralized Power Generation Market Analysis
In terms of end-user, market from the 50 to 100 megawatts range segment is predicted to depict significant growth rate during 2024 to 2032, owing to the surging demand for reliable and resilient power supply, especially in industrial and commercial sectors. The rollout of favorable government policies and incentives is promoting the use of decentralized energy solutions. The need for energy independence and grid stability along with the need for mid-sized decentralized plants to efficiently cater to specific regional or industrial needs will drive the segment growth.
North America decentralized power generation market is estimated to demonstrate commendable growth from 2024 to 2032, on account of the increasing concerns about energy security and resilience. The influx of supportive government policies and incentives, such as tax credits and renewable energy mandates is encouraging investments in distributed generation technologies. Significant advancements in energy storage technologies, along with declining costs of renewable sources like solar and wind are enhancing the feasibility and attractiveness of decentralized power generation. Rising environmental awareness and the pursuit of sustainability goals will also encourage businesses and communities to adopt decentralized energy systems across the region.
Decentralized Power Generation Market Share
Key players in the decentralized power generation industry are significantly investing in R&D to diversify their product portfolios, launching new products, forming contracts, acquiring companies, ramping up investments, and partnering with other entities to extend their global footprint.
Decentralized Power Generation Market Companies
Some of the leading key players operating in the decentralized power generation industry are:
- Wartsila
- Ballard Power Systems
- First Solar
- Doosan Fuel Cell
- Bloom Energy
- Delphi Technologies (BorgWarner)
Decentralized Power Generation Industry News:
- In December 2023, Bloom Energy and SK ecoplant, a subsidiary of South Korean conglomerate SK Group, announced the extension of their 2021 Preferred Distributor Agreement ("PDA"). This partnership helped both the firms to strengthen their respective positions in the power generation market and the global hydrogen economy.
- In November 2023, Panasonic Corporation announced plans to launch a power supply and demand management demonstration project in 2024 at Panasonic Manufacturing UK Ltd. for enhancing the competitiveness of its carbon-neutral businesses.