Combined Heat and Power (CHP) Systems Market

Market Snapshot

The global combined heat and power systems (CHP) market will likely expand 1.5x until 2031, bucking initial scepticism about how the market would perform during a global pandemic. Total sales of combined heat and power systems is estimated to reach US$ 26 Bn by 2031.

As per Fact.MR, demand for CHP abounds in the industrial sector and is the segment with the greatest potential for growth. Advocates for energy efficiency have set a goal of increasing CHP capacity to 20% by 2031.

Key Points Covered in Combined Heat and Power Systems Industry Survey

• Market Estimates and Forecasts 2016-2031
• Key drivers and restraints shaping market growth
• Segment-wise, Country-wise, and Region-wise Analysis
• Competition Mapping and Benchmarking
• Market Share Analysis
• Key Product Innovations and Regulatory Climate
• COVID-19 Impact on Combined Heat and Power Systems and how to navigate
• Recommendation on key winning strategies.

Consumption Analysis of Combined Heat and Power Systems during 2016-2020 Vs Future Outlook for 2021 to 2031.

The demand for combined heat and power systems thrived at a CAGR of nearly 4% to reach US$ 18 Bn by 2020. Extensive developments in the energy sector have heightened demand for combined heat and power systems worldwide.

Based on application, the greatest portion of current installed CHP capacity is in the industrial sector with 1/3rd revenue share, exhibiting the greatest expansion potential.

Manufacturers are inclined to capitalized on the surging demand across the Asian markets. Shifting preference towards replacing conventional energy systems owing to operational cost and uninterrupted utility supply is projected to surge market growth.

According to Fact.MR- market research and competitive intelligence provider- consumption outlook for CHP systems according is to surpass US$ 26 Bn with an expansion rate of over 4% over the forecast period 2021-2031.

How are Energy Efficiency Requirements Widening CHP Systems Adoption?

Owing to snowballing requirement for energy-efficient equipment in end-use industries, demand for CHP systems has accelerated in recent years. Compared to a standard power plant, which operates at about 45% efficiency, a CHP facility typically operates at 80% efficiency, resulting in reduced operational costs.

To avoid energy wastage in the power sector, manufacturers are inducting AI and IoT in CHP facilities which is likely to boost the demand in upcoming years. As per International Finance Corporation (IFC) AI, has the potential to cut energy wastage, lower costs, and facilitate the use of renewable energy sources in power grids worldwide.

Will AI Emerge as the Dominant Combined Heat & Power (CHP) Technology in Forthcoming Years?

According to EPA, the technical and cost-effectiveness potential of CHP systems makes it a feasible solution for power supplies in residential, commercial buildings, municipal, institutions and manufacturers.

Furthermore, advanced economies are leading the way in the application of AI in the power sector. For example, DeepMind, a subsidiary of Google, has been applying machine learning algorithms to predict power output 36 hours ahead of actual generation. Hence, the demand for CHP systems is projected to offer lucrative opportunities for manufacturers worldwide.

Country-wise insights

How is the U.S. Facilitating Uptake of CHPs in Recent Years?

In the U.S, individuals consume over 3x as much electricity per year as they did 50 years ago.  Additionally, it consumes nearly 25% of the world's energy. Based on such high consumption requirements, uptake of CHPs is on the incline across the country.

According to Fact.MR, the United States combined heat and power systems industry is expected to reach US$ 520 Mn by 2031. Manufacturers are striving to introduce energy efficient and cost saving CHP systems, a trend which will majorly influence demand growth.

Why are Combined Heat and Power Systems Flourishing in China?

China’s CHP equipment market was worth US$ 5 Bn as of 2020. According to IEA, China is the only major economy where coal demand increased in 2020. Strong economic growth underpins electricity demand in 2021, while post-COVID stimuli measures support production of steel, cement and other coal-intensive industrial products. 

The Chinese coal power fleet represents around a third of global coal consumption. This includes combined heat and power plants. This demand is only anticipated to accelerate in the future, paving way for future market expansion.

Category-wise insights:

Why Natural Gas is Gaining High Traction by Fuel Type?

Owing to properties such as easy transportation and less carbon footprint, natural gas based combined heat and power systems demand is surging, with an anticipated absolute $ opportunity worth US$ 5 Bn through 2031.

The surged demand forecast can be met by conventional assets that were previously approved or under development before the pandemic, mainly in Russia and the Middle East. Supply is also prospective to be enhanced by new investment in U.S shale gas production to support export capacity for liquefied natural gas (LNG) that is currently under development. 

Why Demand for Gas Turbines is Increasing Worldwide?

By prime mower, gas turbine CHP systems are expected to register a CAGR of approximately 3.8% during the forecast period. Global electricity demand is increasing, and it doubled within the last two decades. It is estimated to expand at 2x the pace of energy demand as a whole, in the next 25 years.

This progress can be attributed to the increasing demand for electricity, availability of efficient power generation technology, rising demand for natural gas-fired power plants, impact of the shale gas revolution, and reduction in the emission of carbon dioxide.

Competitive Landscape:

Prominent players are embracing innovative approaches such as ground-breaking marketing tactics, technological advancements, mergers, and acquisitions.   

• In March 2021, The European Marine Energy Centre (EMEC) collaborated with Highlands and Islands Airports Limited (HIAL) to decarbonise heat and power at Kirkwall Airport through green hydrogen technology.
• 2G Energy was selected to deliver a CHP plant which generates heat and electricity of 100% hydrogen – The first one in the UK.
• In July 2021, Capstone Green Energy signed a 10-year service contract on 1.2 MWs of micro-turbines installed in the fourth-tallest building in New York City. The skyscraper's 1.2 MW energy efficiency plant consists of two Capstone C600S microturbines with Capstone's Integrated Heat Recovery Modules.

Report Scope:

Key Segments Covered

• Product

  • CHP Systems Up to 30 MW
  • CHP Systems 30 MW to 60 MW
  • CHP Systems Above 60 MW

• Fuel

  • Natural Gas powered CHP Systems
  • Coal powered CHP Systems
  • Biomass powered CHP Systems
  • Other Renewable Resources powered CHP Systems

• Prime Mower

  • Gas Turbines powered CHP Systems
  • Steam Turbines powered CHP Systems
  • Gas Engines powered CHP Systems
  • Fuel Cells powered CHP Systems

• Application

  • Industrial CHP Systems
  • Residential CHP Systems
  • Commercial CHP Systems

Combined Heat & Power Systems Market- Scope of Report

A recent study by Fact.MR on the combined heat & power systems market offers a 10-year forecast for 2021 to 2031. The study analyzes crucial trends that are currently determining the growth of the market. This report explicates vital dynamics, such as the drivers, restraints, and opportunities for key market players along with key stakeholders as well as emerging associated with the manufacturing of combined heat & power systems.

The study also provides the dynamics responsible for influencing the future status of the combined heat & power systems market over the forecast period. A detailed assessment of value chain analysis, business execution, and supply chain analysis across regional markets has been covered in the report.

A list of prominent companies operating in the combined heat and power systems market, along with their product portfolios, enhances the reliability of this comprehensive research study.

Report Summary

The study offers a comprehensive analysis of diverse features, including production capacities, demand, product developments, revenue generation, and sales of the combined heat and power systems market across the globe.

A comprehensive estimate of the market has been provided through an optimistic as well as a conservative scenario, taking into account the sales of the combined heat and power systems during the forecast period. Price point comparison by region with the global average price is also considered in the study.

Key Questions Answered in Report

• Which are the most lucrative combined heat & power systems markets?
• Which factors will impact the growth of combined heat & power systems?
• How will changing trends impact the strategies of market players?
• How can market players capture the low-hanging opportunities across regions?
• Which companies are leading the combined heat & power systems industry?
• What are the winning strategies of stakeholders in the market?

Analysis of Market Size Evaluation

The market has been analyzed for each segment in terms of volume (‘000 Units) and value (US$ Mn).

Estimates at global and regional levels for the combined heat and power systems market are available in terms of “US$ Mn” for value and in “‘000 Units” for volume. A Y-o-Y growth contrast on prominent market segments, along with market attractiveness evaluation, has been incorporated in the report. Furthermore, absolute dollar opportunity analysis of all the segments adds prominence to the report. Absolute dollar opportunity plays a crucial role in assessing the level of opportunity that a manufacturer/distributor can look to achieve, along with identifying potential resources, considering the sales and distribution perspective in the global combined heat and power systems market.

Inspected Assessment on Regional Segments

Key sections have been elaborated in the report, which has helped deliver projections on regional markets. These chapters include regional macros (political, economic, and business environment outlook), which are expected to have a momentous influence on the growth of the combined heat and power systems market during the forecast period.

Country-specific valuation on demand for combined heat and power systems market has been offered for each region, along with market scope estimates and forecasts, price index, and impact analysis of the dynamics of prominence in regions and countries. For all regional markets, Y-o-Y growth estimates have also been incorporated in the report.

Detailed breakup in terms of value & volume for emerging countries has also been included in the report.

In-depth Analysis on Competition Analysis

The report sheds light on leading manufacturers of the combined heat and power systems market, along with their detailed profiles. Essential and up-to-date data related to market performers who are principally engaged in producing lung cancer medicines have been brought with the help of a detailed dashboard view. Market share analysis and comparison of prominent players provided in the report permit report readers to take preemptive steps in advancing their businesses.

Company profiles have been included in the report, which includes essentials such as product portfolios and key strategies, along with an all-inclusive SWOT analysis on each player. Company presence is mapped and presented through a matrix for all the prominent players, thus providing readers with actionable insights, which helps in thoughtfully presenting the market status, and predicting the competition level in the combined heat and power systems market domain. 

Research Methodology

In Fact.MR’s study, a unique research methodology is utilized to conduct extensive research on the growth of the combined heat and power systems market industry, and reach conclusions on the future growth parameters. This research methodology is a combination of primary and secondary research, which helps analysts ensure the accuracy and reliability of the draw conclusions.

Secondary resources referred to by analysts during the preparation of the market study include statistics from governmental organizations, trade journals, white papers, and internal and external proprietary databases. Analysts have interviewed senior managers, product portfolio managers, CEOs, VPs, marketing/product managers, and market intelligence managers, all of whom have contributed to the development of the research report as a primary resource.