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DIESEL GENSET MARKET TO HIT $41BN BY 2018

The global diesel generator set market will grow and be worth $41bn by 2018 despite competition from natural gas gensets, claims a new report.

The analysis by Navigant Research in the US states that diesel gensets remain “one of the least expensive, most reliable technologies available today” for commercial facilities like hospitals and data centres that require “mission-critical power in the event of a grid outage”.

Navigant says that in the short term, countries with strong economic and/or population growth rates that also increasingly suffer blackouts – such as Nigeria, India, Chile and South Africa – will continue to drive diesel genset sales.

The report highlights India as an example of a country where industries have become highly dependent on diesel due to power outages spanning as much as 16 hours per day, making them more vulnerable to price volatility.

Yet the report warns that diesel’s grip on the market is waning. “Although providers of diesel gensets can expect to see continued growth over the next several years, they face rising competition from natural gas gensets,” said Dexter Gauntlett, Navigant research analyst.

“Over the next decade, the increase in unconventional gas resources and tightening emissions regulations for stationary generators will favor clean-burning natural gas systems over their diesel counterparts in North America.”

● Navigant has also published a report into virtual power plants, which utilize distributed energy resources via software systems.

Navigant states that the drive to integrate variable generation resources – especially wind and solar – into the grid is resulting in a viable virtual power plants market which the company claims will see substantial growth over the next several years and be worth $3.6bn in 2020 compared with $1bn now.

“The growth in distributed, renewable power generation sources requires additional supply and demand flexibility to accommodate fast ramping periods and corresponding supply forecast error,” said Peter Asmus, principal research analyst with Navigant.

He added that virtual power plants “represent an ideal optimisation platform for the coming transformation of the power grid”.

An executive summary of both reports is available for free download on the Navigant Research website.

Tags: Market Research

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