Microgrid Market Size - By Grid Type (AC Microgrid, DC Microgrid, Hybrid), By Connectivity (Grid Connected, Off Grid), By Power Source (Natural Gas, CHP Solar PV, Diesel Generators), By Storage Device, By Application & Forecast, 2024 – 2032

Microgrid Market Size

Microgrid Market size was valued at USD 17.8 Billion in 2023 and is anticipated to grow at a CAGR of 20.5% between 2024 and 2032. It is a localized energy system capable of operating independently or in conjunction with the main electrical grid. It consists of distributed energy resources, such as solar panels, wind turbines, batteries, and generators, that generate, store, and manage electricity within a defined area. These devices can serve a variety of applications, from residential and commercial buildings to industrial facilities and entire communities.
 

Rising energy resilience and reliability coupled with global shift towards renewable energy and stringent environmental regulations will augment the product adoption. Growing governments and organizations investments in clean energy solutions to reduce carbon footprints and meet sustainability targets is set to propel the product demand.
 

Expanding research investments in developing advanced technology for energy storage, smart grid technology, and distributed energy resources (DERs) are driving the industry growth. Rising innovations in battery storage systems to enhance the efficiency and reliability of microgrids by ensuring a stable energy supply even when renewable sources are intermittent will complement the business scenario.
 

Microgrid Market Trends

Growing investments in grid technologies to enable better energy management, real-time monitoring, and automated controls are set to influence the industry landscape. Furthermore, declining costs of renewable energy technologies and energy storage systems in line with rising government incentives, subsidies, and funding programs aimed at promoting clean energy adoption are significantly driving the product penetration.
 

Increasing shift towards solutions offering energy independence and security, especially for remote and off-grid areas by generating and managing their own energy, communities and facilities reducing dependence on external power sources and enhancing their energy security will impact the business growth.
 

Microgrid Market Analysis

Based on connectivity, the market is segmented into grid connected and off grid. The grid connected segment is anticipated to cross USD 71.7 billion by 2032, on account of their capability to operate in island mode significantly thereby enhancing reliability of energy systems and mitigating the impact of grid outages. Grid tied solutions enable load management and peak shaving, which helps in lowering energy expenses by reducing reliance on expensive peak-time electricity thereby boosting products adoption.
 

Rising integration of renewable energy sources coupled with supportive government policies to encourage the deployment of microgrids through streamlined permitting processes, grid interconnection standards, and financial incentives will stimulate the business statistics.
 

Based on grid type, the microgrid market is segmented into AC microgrid, DC microgrid and hybrid. The hybrid segment is set to expand at a CAGR of over 20.9% through 2032. Growing adoption of solutions offering substantial economic advantages by reducing energy costs and providing financial resilience is fostering the product demand. 
 

Additionally, they offer opportunities for cost savings through demand response programs, where excess energy can be sold back to the grid, further propelling the industry landscape. Increasing demand for technology offering energy independence in regions with unreliable grid infrastructure or in remote locations where extending the main grid is not economically viable is boosting the industry scenario.
 

Asia Pacific microgrid market is expected to surpass USD 54.5 billion by 2032, due to increasing energy demand, need for reliable power supply, and significant investments in renewable energy. Rising natural disasters, such as typhoons and earthquakes in the region, disrupting the main grid thereby improving adoption of microgrids for enhanced energy resilience and reliability.  Additionally, many countries in the region, including China, India, and Japan, are focusing on reducing carbon emissions and integrating renewable energy sources into their power systems? thereby propelling product demand.
 

In the U.S., increasing frequency and severity of natural disasters, such as hurricanes, wildfires, and winter storms, have exposed the vulnerabilities of the traditional centralized power grid thereby driving product demand.  The push for decarbonization and the integration of renewable energy sources coupled with growing ambitious renewable energy targets and climate action plans will stimulate the business landscape.
 

Microgrid Market Share

Key market players are heavily investing in research and development to innovate and improve microgrid technologies including advancements in energy storage systems, smart grid technologies, and integration of renewable energy sources. Key players are forming partnerships with utility companies to help in the integration of microgrids with existing grid infrastructure. Furthermore, new players are improving partnerships with academic institutions and other industry players to foster innovation and development.
 

Microgrid Market Companies

Eminent players operating in the microgrid industry are:

• ABB
• Advanced Microgrid Systems (AMS)
• Caterpillar
• Delta Electronics, Inc
• Exelon Corporation
• General Electric
• General Microgrids
• Heila Technologies
• Hitachi Energy Ltd.
• Honeywell International, Inc.
• Lockheed Martin Corporation
• S&C Electric Company
• Schneider Electric
• Siemens AG
• Toshiba Corporation
   

Microgrid Industry News

• In April 2024, Eaton and Enel North America completed Puerto Rico's largest clean energy microgrid at Eaton's Arecibo circuit breaker manufacturing facility. This microgrid integrates a 5 MW solar system with a 1.1 MW battery and pre-existing onsite generators. It enables the facility to produce and store clean energy independently, thereby reducing its carbon footprint, improving energy resilience, and strengthening community infrastructure.
   
• In May 2024, At the Alliance for Rural Electrification Energy Access Investment Forum, Schneider Electric introduced its new microgrid solution, Villaya Flex to support rural African electrification. The product is a comprehensive microgrid package designed to enhance clean energy use while minimizing pollution from generator sets. This solution offers ease in sizing, ordering, commissioning, operating, and maintaining, with highly scalable battery storage capabilities.
   

The microgrid market research report includes an in-depth coverage of the industry with estimates & forecast in terms of revenue and volume in “USD Billion & MW” from 2021 to 2032, for the following segments:

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Market, By Grid Type

• AC Microgrid
• DC Microgrid
• Hybrid

Market, By Connectivity

• Grid Connected
• Off Grid

Market, By Power Source

• Diesel Generators
• Natural Gas
• Solar PV
• CHP
• Others

Market, By Storage Device

• Lithium-ion
• Lead Acid
• Flow Battery
• Flywheels
• Others

Market, By Application

• Healthcare
• Educational Institutes
• Military
• Utility
• Industrial/ Commercial
• Remote
• Others

The above information has been provided for the following regions and countries:

• North America
  • U.S.
  • Canada
  • Mexico
• Europe
  • Germany
  • France
  • UK
  • Russia
  • Spain
  • Italy
  • Denmark
• Asia Pacific
  • China
  • Japan
  • South Korea
  • India
  • Australia
  • Malaysia
  • Indonesia
• Middle East and Africa
  • Saudi Arabia
  • UAE
  • South Africa
  • Iran
  • Nigeria
• Latin America
  • Brazil
  • Argentina
  • Chile