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Combined Heat & Power Installation Market Size Report, 2020-2027

Combined Heat & Power Installation Market Analysis Report By Type, By Fuel, By Technology, By Region And Segment Forecasts From 2020 To 2027

Report ID: MN17620024  |  Published: August 2020  |  No of Pages: 130
Format: Electronic (PDF)  |  Industry: Energy  |  Publisher: Grand View Research

Industry Insights

The global combined heat and power (CHP) installation market size was accounted for USD 9.4 billion in 2019. The market is projected to witness a 3.1% CAGR over the forecast duration, 2020 to 2027. The shift towards the replacement of conventional energy systems with energy-efficient system and need for utility supply without interruption is estimated to drive the market. Further, consumers’ preference for sustainable energy and rise in demand for captive power generation is estimated to bolster the market growth. In addition, increasing investment to curb the carbon emission will drive the CHP installation.

The use of thermal power plants is prevalent in emerging countries. These power plants utilize only half of the total heat and remaining heat is lost through the cooling tower, flue gas and other ways. With the help of CHP, remaining heat can be used for electricity generation, which, in turn, can increase the efficiency of the power plants by 80%. Stringent government regulation to reduce the CO2 emission is projected to drive the installation of combined heat and power.

U.S combined heat and power installation market

Easy availability of natural gas at a low price is estimated to positively affect market growth. Natural gas is the main fuel used for CHP installation and it is available in adequate quantity in countries such as Iran, Russia, the United States and Qatar. Moreover, natural gas-based systems are easy in installation and prove cost-effective in the long run compared to other alternate fuels. The rise in energy prices has led to finding ways and means for cost-effective power generation.

Awareness about sustainable and cost-effective energy is gaining traction in emerging countries. Thus, the growing need for cost-effective energy is predicted to supplement the CHP installation from 2020 to 2027. However, high initial cost incurred in the installation of a CHP system is estimated to restrain its market growth over the next seven years. Compared to diesel generators and boilers, CHP systems are costly.

Type Insights

In 2019, the large-scale category held 79.5% of share in the total market. Large scale segment finds its application in both industrial and commercial sectors. Increasing demand for energy from major industries such as textile, pharmaceuticals, sugar, refining, chemical, pulp, paper and cement is driving the segment growth. This segment is used in these industries owing to the requirement for high pressure and temperature. On the other hand, the small-scale division held a little over 20% share in the market in 2019. Further, the segment is anticipated to register 5.5% CAGR over the forecast duration.

 The rise in demand for clean energy from both the commercial and residential sector is estimated to drive market growth. Combined heat and power installation industries, owing to their sustainability, are increasingly favored over the conventional source of energy. CHP systems are widely used in the treatment of wastewater in the residential sector in countries such as Japan, the United States and Germany. In addition, these systems find their application in various commercial set-ups such as hospitals, airports, military bases and office building.

Fuel Insights

Based on fuel type, natural gas-powered CHP is estimated to hold a 66.0% share in the market by 2027. In 2019 also, the segment accounted for more than 65% share in the market and emerged as the largest among all. Easy and cost-effective availability of natural gas is the prime reason driving the segment growth. In addition, natural gas is considered to be the clean form of energy that helps in curbing carbon emission. On the other hand, coal-based system accounted for over 18% share in the market and estimated to grow with moderate pace over the forecast duration. Low cost and high calorific value make it a relevant source of energy to be used for the CHP system.

However, emission of harmful gases and high cost involved in handling is estimated to limit the use of coal. Biomass is the other renewable source of energy used in the CHP system. They are predominantly used in small-scale CHP system and likely to grow considerably over the forecast duration owing to their ability to curb carbon emission. Various other fuel includes oil, processed waste and wood. Wood waste is used in a small-scale system in both commercial and residential application.

Technology Insights

Depending on the technology, the combined cycle category held over 55% share in the market in 2019. The segment accounted for more than 6 billion in 2019. These systems are mostly used in applications where there is a need for high energy. Such applications are in industries like sugar, chemical, refining, paper, pulp and pharmaceuticals. This technology offers various advantages such as low emission, thermal output, low installation and energy-efficiency.

Global CHP installation market

Steam turbine enabled technology held more than 26% of share in the market in 2019. Further, the segment is likely to grow at a moderate pace from 2020 to 2027. Some of the other technologies incorporated in CHP installation are waste heat recovery, micro turbine, fuel cell combustion turbine and waste heat recovery among others. Of them, micro turbines are used to generate electricity in the range of 30KW to 250 KW. Fuels such as natural gas, sour gas and other liquid fuels are used in this system.

Regional Growth

In 2019, Europe held the largest share in the market with over 50%. Further, the region is predicted to continue its dominance from 2020 to 2027. Government regulations to reduce pollution in countries such as U.K, France and Germany are driving regional growth. On the other hand, in North America, the total demand for CHP installation was 110.5 GW in 2019. Further, the demand is anticipated to touch 142.9 GW by the end of 2027, expanding with 3.3% CAGR. Regulations imposed by the U.S EPA is driving the CHP installation.

Asia Pacific held a 27% share in the market and estimated to register a 4.3% CAGR over the forecast duration. The presence of large scale manufacturing units in countries such as India, China, Japan and South Korea is driving the regional growth. Further, these countries are also focusing on curbing the emission, thereby, supplementing the CHP installation.

Impact of COVID-19

The outbreak of novel coronavirus has adversely affected the global combined heat and power installation market growth. The pandemic outbreak has led to the closure of several industries such as chemical, food & beverage, pulp, paper, manufacturing and others. These industries are the major end-users of large-scale combined heat and power installation system. The closure of these industries has adversely affected the demand for power consumption. In addition, key players in the market reduced their expenditure on research and development owing to lack of demand, thereby, considerably affecting the market growth.

Key Companies & Market Share Insights

CHP installation market is characterized by its moderately consolidated nature. Key players are focusing on building Recent Developments to introduce innovative products in the market. Introduction of new products helps companies in gaining a competitive edge over others. Technical advancements, partnerships and increasing research & development activities are further anticipated to bolster the market growth. For example, GE signed an agreement with GreenTech installation of CHP in Russian food and beverage, chemical and glass industries. Major players operating in the market are Centrica, Cummins Inc., General Electric, Caterpillar, Wartsila, E.ON SE, Clarke Energy, Tecogen Inc., and Siemens among others.

Combined Heat & Power Installation Market Report Scope

Report Attribute

Details

Market size value in 2020

USD 9.8 billion

Revenue forecast in 2027

USD 12.0 billion

Growth Rate

CAGR of 3.1% from 2020 to 2027

Base year for estimation

2019

Historical data

2016 - 2018

Forecast period

2020 - 2027

Quantitative units

Revenue in USD billion and CAGR from 2020 to 2027

Report coverage

Revenue forecast, company ranking, competitive landscape, growth factors, and trends

Segments covered

Type, fuel, technology, region

Regional scope

North America; Europe; Asia Pacific; RoW

Country scope

The U.S.; Canada; Mexico; The U.K.; Germany; Spain; Poland; Netherlands; France; Russia; Italy; China; India; Japan; South Korea; Taiwan

Key companies profiled

E.ON SE; Mitsubishi Hitachi Power Systems, Ltd.; Siemens; Centrica; General Electric; BdrThermea Group; Aegis Energy Services Inc.; Clarke Energy; Cummins Inc.; Capstone Turbine Corporation; Caterpillar; Elite Energy Systems, LLC; Doosan Fuel Cell America, Inc.; Tecogen Inc.; Wartsila

Customization scope

Free report customization (equivalent up to 8 analysts’ working days) with purchase. Addition or alteration to country, regional & segment scope.

Pricing and purchase options

Avail customized purchase options to meet your exact research needs.


Segments Covered in the Report
 

This report forecasts revenue growth at global, regional, and country levels, and provides an analysis on latest industry trends in each of the sub-segments from 2016 to 2027. For the purpose of this study, Million Insights has segmented the global combined heat & power installation market report on the basis of product, fuel, technology, and region:

• Type Outlook (Volume, GW; Revenue, USD Billion, 2016 - 2027)
    • Large Scale
    • Small Scale

• Fuel Outlook (Volume, GW; Revenue, USD Billion, 2016 - 2027)
    • Natural Gas
    • Coal
    • Biomass
    • Others

• Technology Outlook (Volume, GW; Revenue, USD Billion, 2016 - 2027)
    • Combined Cycle
    • Steam Turbine
    • Combustion/Gas Turbine
    • Reciprocating Engine
    • Others

• Regional Outlook (Volume, GW; Revenue, USD Billion, 2016 - 2027)
    • North America
        • The U.S.
        • Canada
        • Mexico
    • Europe
        • Germany
        • The U.K.
        • France
        • Russia
        • Poland
        • Spain
        • Italy
        • Netherlands
    • Asia Pacific
        • China
        • India
        • Japan
        • South Korea
        • Taiwan
    • Rest of World (RoW)

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