Distributed Generation Market – Global Industry Analysis and Forecast (2023-2029)

Distributed Generation Market reached a value of US $ 243.88 Bn. in 2022. Distributed Generation industry size is estimated to grow at a CAGR of 10.9%.

The Distributed Generation is embedded or local generation. It is referred to as electricity generated from sources, often renewable energy sources, at the point of use rather than centralized generation sources from power plants. Distributed Generation technologies help in the delivery of power to off-the-grid remote infrastructure and facilities, as well as electric vehicles, and support the spread of renewable energy resources.

Traditional power generation has several concerns, such as low efficiency, pollution issues, the requirement for costly transmission infrastructure, and high capital expenses for the utility. A Distributed Generation system close to the consumer eliminates these limitations, improves power quality and dependability, increases generation efficiencies, and gives the customer a choice of generation technologies.

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Global Distributed Generation Market Dynamics:
Liberalization and deregulation of energy markets, along with the accelerated restructuring of electric power utilities, are primarily driving the trend towards distributed generation market across the globe. Commercial factors such as easier land acquisition, faster construction of modular distributed power generation modules, and lower transmission costs are boosting the trend in the global market. In addition, the rising energy consumption and rising costs of grid networks are expected to boost the distributed generation market growth during the forecast period.

The Distributed Generation market is showing continuous northward direction growth, thanks to the wide range of benefits including, the system improved reliability outcomes, reduced electricity price, reduce the cost of power system augmentation, aid to reduce supply cost faced by a consumer, and helps to reduce overall emission intensity of the NEM, by displacing other more emissions-intensive generation. On-site generation saves roughly 30% of the cost of delivered electricity on transmission and distribution. Furthermore, On-site fossil fuel power generation provides waste heat that can be utilized by the customer. In addition, distributed generation may be better positioned to exploit low-cost fuels like landfill gas.

Share of Distributed Generation in the total power generation:

The majority of electricity in the United States is generated by centralized sources includes coal, natural gas, nuclear, and huge hydropower, which carry large amounts of energy across long distances. Inefficiencies in the transmission process lose 6% of generated electricity in the United States, as to the long distances the power must travel. Building new transmission lines or improving existing ones can be costly and time-consuming, as challenges with siting and delays. The Distributed Generation avoids these efficiency losses by deploying smaller power systems where they are needed. These initiatives are expected to drive the distributed generation market growth during the forecast period.

Favorable government policies and regulations, such as net metering, are expected to boost the number of distributed generation installations in residential regions, such as underdeveloped and rural areas. The market is also benefiting from the increased success of R&D activities, demonstration projects, and field trials, which are lowering the cost of distributed energy technologies and, as a result, accelerating their adoption.

 
Global Distributed Generation Market Segment Analysis:
Based on the Technology, the Distributed Generation Market is segmented into Solar PV, Wind, Reciprocating Engines, Microturbines, Fuel Cells, and Gas Turbines. The Fuel Cell segment held the largest market share, accounting for xx% in 2021. The Fuel Cell converts fuels to electricity with high efficiency of 35%-60%, as compared to conventional technologies, which keeps greenhouse gas emissions to a minimum. The noxious pollutants are minimal as there is no combustion. Fuel cells have a high degree of reliability, thus they are used to supplement or replace grid-based electricity.

Gas Turbine Segment

The Gas Turbines segment is expected to witness significant growth at a CAGR of xx% during the forecast period. Gas turbines of all sizes, which were created for jet engines, are now widely used in the power industry. In CHP applications, small industrial gas turbines ranging from 1 to 20 MW are often used. The cost of maintenance is slightly cheaper than that of reciprocating engines, but the electrical conversion efficiency is also lower. The Microturbines turbine can spin at 120 000 rpm, while the generator can spin at 40000 rpm. Individual units range in power from 30-200 kW, however, they are easily coupled into multi-unit systems. Low combustion temperatures result in extremely low NOx emissions.

Based on the End-User, the Distributed Generation Market is segmented into Industrial, Commercial, and Residential. The commercial segment held the largest market share, accounting for xx% in 2021. The segment growth is attributed to an increased number of roof-top solar installations, which are self-sufficient and cost-saving implementations. Furthermore, governments all over the world are pursuing laws to boost the use of renewable technology in these applications as they offer high efficiency, energy security, pollution reduction, and resiliency than traditional electricity production methods.
Global Distributed Generation Market Regional Insights:
Asia Pacific region held the largest market share accounted for 40 % in 2022. The rising energy demand from the industrial, commercial and residential sectors has resulted in the strong expansion of distributed generation systems in the region. The region’s growth is attributed to favorable government policies, incentives such as tax credits, and a focus on renewable energy. China is the largest producer of solar energy and biogas energy, followed by Japan and India. China's National Development and Reform Commission (NDRC), Ministry of Finance, and National Energy Board stated on May 31, 2021, stopping all subsidies for utility-scale solar projects in favor of competitive bidding, lowering feed-in rates. This decision is expected to reduce demand in China's solar market by around 43%. In 2022, 44.26 GW of solar PV capacity was installed, with 20.9 GW going to distributed generation and the remaining 23.3 GW going to utility-scale PV power installations.

North America region is expected to witness significant growth at a CAGR of xx% during the forecast period. The federal tax reform in the United States provides an incentive to increase electrical system energy efficiency to reduce overall electricity demand and carbon emissions, which are driving the market growth for this region. The wind turbine has the highest market share in U.S., while, solar PV is the fastest-growing segment thanks to its declining costs and extensive geographic distribution products under the solar lease.

The objective of the report is to present a comprehensive analysis of the Distributed Generation Market to the stakeholders in the industry. The past and current status of the industry with the forecasted market size and trends are presented in the report with the analysis of complicated data in simple language. The report covers all the aspects of the industry with a dedicated study of key players that include market leaders, followers, and new entrants.

PORTER, PESTEL analysis with the potential impact of micro-economic factors of the market have been presented in the report. External as well as internal factors that are supposed to affect the business positively or negatively have been analyzed, which will give a clear futuristic view of the industry to the decision-makers.

The reports also help in understanding the Distributed Generation Market dynamic, structure by analyzing the market segments and projecting the Distributed Generation Market size. Clear representation of competitive analysis of key players by product, price, financial position, product portfolio, growth strategies, and regional presence in the Distributed Generation Market make the report investor’s guide.
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Distributed Generation Market


Report Coverage
Details


Base Year:
2022
Forecast Period:
2023-2029


Historical Data:
2018 to 2022
Market Size in 2022:
US $ 243.88Bn.


Forecast Period 2023 to 2029 CAGR:
10.9%
Market Size in 2029:
US $ 503.14 Bn.


 Segments Covered:
by Technology
Solar PV
Wind
Reciprocating Engines
Microturbines
Fuel Cell
Gas Turbines


by End-User
Industrial
Commercial
Residential


by Application
On-Grid
Off-Grid



Distributed Generation Market, by Region
North America (United States, Canada and Mexico)
Europe (UK, France, Germany, Italy, Spain, Sweden, Austria and Rest of Europe)
Asia Pacific (China, South Korea, Japan, India, Australia, Indonesia, Malaysia, Vietnam, Taiwan, Bangladesh, Pakistan and Rest of APAC)
Middle East and Africa (South Africa, GCC, Egypt, Nigeria and Rest of ME&A)
South America (Brazil, Argentina Rest of South America)
Distributed Generation Market, Key Players
1.Siemens
2. Schneider Electric
3. General Electric
4. Mitsubishi Heavy Industries
5. Capstone
6. Caterpillar
7. Ansaldo Energia
8. Fuelcell Energy
9. Cummins
10. Bloom Energy
11. Bergey
12. Doosan Fuel Cell America
13. Vestas Wind Systems A/S
14. Rolls-Royce Power Systems AG
15. Toyota Turbine and Systems Inc.

Frequently Asked Questions:

1] What segments are covered in the Distributed Generation Market report?
Ans. The segments covered in the Distributed Generation Market report are based on Technology, End-User, and Application.

2] Which region is expected to hold the highest share in the Distributed Generation Market?
Ans. The Asia Pacific region is expected to hold the highest share in the Distributed Generation Market.

3] What is the market size of the Distributed Generation Market by 2029?
Ans. The market size of the Distributed Generation Market by 2029 is US $ 503.14 Bn.

4] What is the forecast period for the Distributed Generation Market?
Ans. The Forecast period for the Distributed Generation Market is 2022-2029.

5] What was the market size of the Distributed Generation Market in 2022?
Ans. The market size of the Distributed Generation Market in 2022 was US $ 243.88 Bn.