Diesel Generator Market Size, Share & Trends Analysis By Power Rating (Low Power, Medium Power, High Power), By Application (Residential, Commercial, Industrial), And Segment Forecasts, 2022 - 2030

Report Overview

The global diesel generator market size was valued at USD 18.74 billion in 2021 and is projected to progress at a compound annual growth rate (CAGR) of 8.5% during the forecast period. The increasing demand for energy across the globe outstrips the supply. Factors such as continuous population growth, infrastructure development, and rapid industrialization in emerging economies are pacing the demand for power. Diesel generators have numerous advantages such as low operating costs and better fuel efficiency. Thus, they are much popular in developing regions, especially in the Asia Pacific region. Along with its advantages, it had many other drawbacks which include noise pollution and the emission of hazardous gases. The World Nuclear Association has projected that the electricity requirement is expected to double the current consumption. According to the U.S. Department of Energy, solar energy will be the most abundant energy source available.

Significant growth in the economies of the major developing nations such as India, Brazil, and others is expected by 2050. India is expected to grow from being the third-largest to the second-largest economy in the world, only after China in terms of GDP(gross domestic product) at PPP (purchase power parity). Countries such as Brazil, India, and South Africa are already suffering due to low power supply. Emerging economies are expected to account for 65% of the global economy.

The market in the U.S. is anticipated to witness substantial growth owing to rising costs of power outages across several IT-enabled service firms and data centers along with growing consumer awareness of the requirement for reliable emergency power supply. In addition, the market is also driven by the rising vulnerability of grid power stations to disasters caused by changing weather conditions across the region.

Solution providers across the diesel generator market are primarily responsible for generator system manufacturing, installation, maintenance, and repair. Generator dealers or electrical contractors establish product supply and maintenance contracts with end-market consumers present across commercial places, residential places, and small-size companies using generators as emergency power backup systems. Moreover, companies also assign an in-house monitoring engineer to supervise a large number of generators in industrial-scale operations.

Stringent government regulations regarding the reduction of harmful carbon emissions are expected to boost the penetration of gas-based generators over diesel generators. This trend is anticipated to restrict the market demand for diesel generators across all the end-use sectors. However, low operating costs and low initial investment are among the key factors sustaining the current requirement for diesel generator sets.

Power Rating Insights

The low power generator segment accounted for a significant market revenue share of 43.71% in 2021 owing to the presence of a wide application base in commercial and residential sectors. Generators with a capacity below 80 kW are used as power backup solutions in residential homes to power devices such as water pumps, water purifiers, AC units, geysers, and others. Furthermore, the low cost of these generators is expected to play a crucial role in boosting the product demand during the forecast years.

The high power generator segment is expected to attain a significant growth rate during the forecast period owing to its rising demand in power, manufacturing, and marine industry, where there is a huge requirement for continuous power supply. High-power diesel generators are installed for power generation and distribution across off-grid remote areas, as it is not economically feasible to supply direct grid power to several remote places.

Application Insights

The commercial application segment occupied the largest market revenue of USD 8.46 billion and is projected to register a substantial growth rate during the forecast period. The high growth rate can be attributed to the wide application scope including several industries such as data centers, government centers, educational institutions, healthcare, hospitality, telecom, agriculture, and others. Diesel gen-sets are used across commercial establishments to backup sudden power interruptions such as voltage fluctuations and electrical outages, if not tackled, add up to financial losses.

The industrial diesel generator segment accounted for the second-largest market revenue share of USD 6.61 billion in 2021. The segment includes the manufacturing and construction sector, electric utilities, mining, transport & logistics, and oil & gas sector, these sectors draw huge product demand citing their heavy power consumption operations. Favorable government policies for industrial development in developing economies such as China, India, and Brazil are among the key factors driving the segment growth.

The residential segment is expected to witness significant growth over the forecast period on account of rising customer awareness, growing load demand on the primary grid, and a growing number of power failures, which are among the critical factors propelling the product demand across the residential sector. Moreover, diesel generators serve as a reliable secondary power source in households in case of a grid failure or electrical outages.

Regional Insights

The market in the Asia Pacific is projected to experience the fastest CAGR of 10.3% over the forecast period, with China being the major revenue contributor with USD about 2,997.0 million to the regional market growth. The rising number of manufacturing facilities and infrastructure projects, rising electricity demand-supply gap, and rapid development of commercial office spaces in China are anticipated to provide a boost to the industry landscape across the region.

In the Asia Pacific, diesel generator sets are predominantly used for backup as the region has a moderately developed power infrastructure that supplies low-cost electricity from the utility grid. The demand pattern for diesel generator sets depends on different factors such as the country’s power infrastructure, emission norms, and purchasing power of customers.

North America accounted for a significant market share of 21.85% in 2021, with the U.S. occupying a dominant revenue contributor position across the region. Continuously developing infrastructure of data centers and other commercial markets along with the growing vulnerability of the power grid to weather-based outages has led to strengthening demand for reliable backup power solutions, in turn stimulating the demand for diesel generators across the region.

Key Companies & Market Share Insights

Major industry participants are practicing several organic and inorganic strategic growth initiatives in order to expand their service portfolio and enhance their foothold in the market. Some of the prominent market players in the global diesel generator market include:

• AKSA power generation company

• Atlas Copco AB

• Caterpillar

• Cummins Inc.

• Doosan Portable Power

• Generac Power System Inc.

• Honda India Power Products Ltd.

• Kohler Co.

• Rolls-Royce plc

• Wartsila Corporation

Diesel Generator Market Report Scope

Segments Covered in the Report

This report forecasts revenue growth at global regional & country levels and provides an analysis of the industry trends in each of the sub-segments from 2016 to 2027. For this study, Grand View Research has segmented the global diesel Generator market based on power rating, application, and region:

• Power Rating Outlook (Revenue, USD Million, 2019 - 2030)

  • Low Power Generator

  • Medium Power Generator

  • High Power Generator

• Application Outlook (Revenue, USD Million, 2019 - 2030)

  • Industrial

  • Commercial

  • Residential

• Regional Outlook (Revenue, USD Million, 2019 - 2030)

  • North America

    • U.S.

    • Canada

    • Mexico

  • Europe

    • U.K.

    • Germany

    • Russia

    • France

  • Asia Pacific

    • China

    • Japan

    • India

    • South Korea

  • Central & South America

    • Brazil

    • Argentina

  • Middle East & Africa

    • Saudi Arabia

    • UAE