Market Overview and Growth Highlights 2019-2028
A genset or generator set is a combination of an engine and an alternator. The engine typically converts the chemical energy gathered from the fuel to the mechanical energy, which is then used to spin the alternator rotor. The spinning alternator rotor converts mechanical energy into electrical energy. The European genset market is thriving on account of the growing popularity of hybrid genset systems, along with the continuous product development and the increasing investments for research & development by the key manufacturers. Moreover, recent trends pertaining to the adoption of zero or low-emission gensets in the region are also anticipated to contribute to the market growth. Hybrid gensets possess several benefits over conventional gensets, such as it uses renewable energy sources, generates lower fuel bills and lesser noise pollution, and also can be controlled by a digital system controller. These gensets can be used along with multiple renewable energy sources, such as solar, tidal, wind, and biomass amongst others. The genset market in Europe is also anticipated to grow on account of the rapid industrialization, along with the growing commercial sector, which is raising the need for backup power systems, and therefore the need for the deployment of gensets in these sectors. Moreover, increasing investments aimed towards the expansion of the telecom infrastructure in the region is also projected to contribute to the market growth.
The Europe genset market is projected to touch USD 4211.7 million by the end of 2028. The market is further anticipated to grow with a CAGR of 3.7% during the forecast period, i.e., 2021-2028. Additionally, the market is expected to reach USD 3262.9 million by the end of 2021 despite the severe impact of COVID-19 on the genset industry in Europe.
Market Segmentation Synopsis
The Europe genset market is segmented by genset-type into diesel generators, natural gas generators, and others. Among these segments, the diesel genset segment registered the largest market share of 61.68% in the year 2019 owing to the rapidly increasing demand for diesel gensets from the data centers present in the country, coupled with the high efficiency and low-maintenance cost of diesel generators as compared to other genset types. The market is also segmented by application into standby backup power, prime/continuous power, and peak shaving power, out of which, the standby backup power generator segment is projected to grab the largest market share of 83.37% by the end of 2028. The growth of the segment can be attributed to the increasing application of standby backup generators in different end-use sectors, such as residential, commercial, and industrial among others. Moreover, increasing demand for generator sets for emergency purposes, as these generator sets are extremely useful wherein access to power is critical, along with the need for generator sets that can run for a longer period in the absence of grid power, are some of the factors anticipated to drive the growth of the segment during the forecast period. CLICK TO DOWNLOAD SAMPLE REPORT
The Europe genset market is further segmented by power rating into up to 100 kVA, 100-300 kVA, 350-750 kVA, 750-1000 kVA, 1000-2000 kVA, 2000-3000 kVA, and above 3000 kVA, out of which, the up to 100 kVA segment registered the largest share in the year 2019. The segment is further expected to reach a value of USD 839.7 million by the end of 2021. The growth of the segment can be attributed to the rapidly increasing residential construction activities in a few countries in Europe which is raising the need for the deployment of up to 100kVA gensets. Decent size family apartments and commercial spaces such as offices and restaurants can be powered using a genset of power rating up to 100kVA. These gensets can easily take a load of lights, fans, refrigerators, air conditioners, and other residential electronic equipment.
The Europe genset market is also segmented by end-user into residential, commercial, industrial, healthcare facilities, and others. The commercial segment is projected to grow with the highest CAGR of 4.0% during the forecast period. The gensets used in the commercial sector can operate on different types of fuels including diesel, natural gas, kerosene, and propane. Some of the most commercial applications of gensets in the commercial sector include hotels & restaurants, offices, data centers, and others. The commercial segment is further divided into offices, hotels & restaurants and others. Among these segments, the offices segment is projected to grab the largest market share by the end of 2021.
Market Drivers & Challenges
Rapidly Increasing Demand for Uninterrupted Power Supply from End-Use Industries to Drive the Market Growth
The growing demand for reliable and uninterrupted power supply from end-use sectors, such as construction, residential, commercial, and healthcare among others is raising the need for the deployment of gensets in these sectors. Moreover, on account of the rapid industrialization, backed by the growing population in the region, there is a rising need for electricity, which in turn is raising the need for the adoption of uninterrupted power systems, such as gensets. Additionally, rising concern for the power outages in few countries in Europe is also raising the need for the deployment of gensets. Such factors are anticipated to drive the growth of the Europe genset market.
Stringent Government Regulations for Limiting Carbon Emissions to Hamper the Market Growth
The European Environmental Agency has set several stringent regulations in the European Union to regulate the amount of carbon emitted into the atmosphere by the generator sets. As a result, genset manufacturers are required to possess a type approval certification for each generator being manufactured by them. Moreover, rising consumer awareness for environmental pollution is also anticipated to impact the demand for non-renewable power backup systems, such as generator sets. Such factors are anticipated to hamper the market growth during the forecast period.
Impact of COVID-19 on Europe Genset Market
The supply chain for the production of gensets in Europe during the COVID-19 pandemic has witnessed a major disruption with the unavailability of labor, cash-flow issues, and restrictions on trade, hampered primarily due to the imposed lockdown regulations in several countries in the region. Imports of key components from other countries were severely hampered and logistical constraints further raised the complications for the procurement of key components to produce diesel, natural gas, and other forms of generator sets. The sales of gensets in the European region during the coronavirus pandemic also plunged down significantly, majorly impacted by the closure of offline sales channels.
Top Featured Companies Dominating the Market
Some of the affluent industry leaders in the Europe genset market are Cummins Inc., AKSA POWER GENERATION (KAZANCI HOLDING), Caterpillar, Briggs & Stratton, LLC, PR INDUSTRIAL srl (Generac Power Systems, Inc.), Mitsubishi Heavy Industries Ltd., Kohler Co., and Doosan Portable Power.