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

Report Overview

The global natural gas generator market size was valued at USD 7.13 billion in 2021 and is projected to expand at a compound annual growth rate (CAGR) of 11.4% during the forecast period. The rising occurrence of power outages and power supply deficits globally, combined with regulations imposed on the use of diesel gensets due to high levels of carbon emissions, is driving the global demand for natural gas generators. However, the high capital cost of natural gas genset as compared to diesel genset coupled with limited natural gas reserves is expected to restrict the growth of the business.

The U.S. natural gas generator market accounted for the largest market share in 2021 in the North American market, and the trend is projected to continue during the forecast period due to the growing concern for carbon emissions caused by diesel gensets and the availability of natural gas as a fuel for gensets. Moreover, growing industrial and commercial facilities, such as shopping malls, high rises, universities, restaurants, district heating, and cooling plants, refineries, office buildings, and others in the U.S., are driving the demand for uninterrupted electricity supply to expand businesses and perform operations efficiently, which propels the demand for natural gas gensets.

Natural disasters and severe weather conditions due to climate change have resulted in extended power outages, driving demand for backup power as a necessary amenity in commercial, residential, and industrial buildings. The abundance of natural gas in the United States, combined with the well-developed infrastructure for transporting it within the country, has fueled the demand for generator sets in the United States. Gas generator sets are becoming more popular than diesel generator sets due to the country's shale gas revolution, and this trend is expected to continue in the coming years.

Power Rating Insights

The low power genset segment was valued at USD 3.10 billion in 2021. Low power gensets are popular for residential and commercial power backup applications. Nowadays, people use various electrical appliances in their homes, such as geysers, water pumps, AC units, water purifiers, and others. These appliances require more power to function as in the case of washing machines, which might consume 750 watts but need about 2500 watts to start. As a result, many households choose to have only an 80 KW generator set as a standby power source.

The medium power genset segment accounted for the second-largest market share in 2021 and is anticipated to expand at the highest CAGR during the forecast period. Increasing demand for medium power gensets from emerging economies, such as China, India, and Brazil, for backup power systems, which use clean fuel for commercial and industrial applications, is a major driver for medium power gensets. 350 KW and above rating genset can power heavy machines and large equipment.

Rapid industrialization in emerging economies, including India, China, and Brazil, is expected to drive the demand for medium and high power gensets.High power gensets are majorly installed in large manufacturing facilities, power plants, and in the marine industry, where a continuous power supply is crucial. Moreover, they are also installed in a remote location for power generation and distribution where there is no grid connection. 

Application insights

Based on the application of natural gas gensets, the market is segmented into residential, commercial, and industrial segments. The commercial segment was estimated as the largest natural gas generator market globally, with an estimated value of USD 3,224.7 million in 2021. The commercial segment is projected to expand at the highest CAGR of 12.0% during the forecast period, owing to the growing demand for cleaner and greener fuel-fired gensets for commercial applications.

Developing economies in Asia Pacific have witnessed strong growth in their commercial sectors. IT, telecom, and retail are some of the major sectors that are growing rapidly in developing countries in Asia Pacific, resulting in high demand for natural gas gensets as they are crucial for backup power in these facilities.

Hospitals and medical institutes are the main contributors to the commercial segment of the natural gas generator market. Medical facilities, along with the communities they support, depend heavily on emergency generator sets for critical power. The growing demand for gensets from healthcare facilities is expected to drive the demand for natural gas gensets for commercial applications during the forecast period.

Regional insights

The market in North America was valued at USD 2,181.8 million in 2021, wherein the U.S. was the major contributor to the natural gas generator market in the region. The presence of prominent gas genset OEMs and EPC players, large shale gas reserves, and developed infrastructure for transportation of natural gas has emerged as the primary driving factors for the North America natural gas generator set market. The U.S. accounted for the largest share in 2021 and is anticipated to progress at the fastest growth rate in North America during the forecast period, owing to various factors such as the presence of shale gas reserves and increasing government focus on developing clean energy sources.

Asia Pacific is estimated to be the fastest-growing region with a CAGR of 14.0% during the forecast period. Asia Pacific market is driven by the need for efficient backup power systems. The high growth of the industrial sector in China, India, Japan, and South Korea has triggered the demand for industrial generator sets in the region.

Furthermore, in India, government initiatives are encouraging industrial establishments in the country, which is anticipated to drive the demand for gas generator sets for industrial applications during the forecast period. The generator set industry in India is inclined toward diesel as a raw material. However, governmental regulations to curb carbon emissions caused by the burning of diesel coupled with the shifting focus of the government toward the use of cleaner sources for power generation are expected to drive the demand for natural gas gensets during the forecast period.

Key Companies & Market Share Insights

Key companies in the industry are adopting various organic and inorganic growth strategies to expand their service portfolio and gain market share. For instance, in September 2019, Kohler Co., Inc. was honored with the Green Power Leadership Award 2019 by the U.S. Environmental Protection Agency (EPA). This is one of the voluntary programs run by the U.S. EPA to enhance the utilization of green power across the U.S. Under this program, Kohler Co., Inc. purchased 425 million units of renewable power on an annual basis to offset its electricity consumption across the U.S. and Canada. Furthermore, in June 2018, the company completed the acquisition of Selmec and was involved in the designing and manufacturing of diesel generators in the range of 10 kW to 2,750 kW and natural gas generators in the range of 30 kW to 400 kW. Some prominent players in the global natural gas generator market include:

• Caterpillar Inc.

• Cummins Inc.

• Generac Power System

• Mitsubishi Heavy Industries, Ltd.

• Kohler Co., Inc.

• General Electric

• MTU-onsite Energy GMBH

• Mahindra Powerol

• Yanmar Co., Ltd.

• Coopercorp Generators 

Natural Gas Generator Market Report Scope

Segments Covered in the Report

This report forecasts revenue and revenue growth at global, regional & country levels and provides an analysis of the industry trends in each of the sub-segments from 2019 to 2030. For this study, Grand View Research has segmented the global natural gas generator market based on power rating, application, and region.

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

  • Low Power Genset

  • Medium Power Genset

  • High Power Genset

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

  • Industrial

  • Commercial

  • Residential

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

  • North America

    • U.S.

    • Canada

    • Mexico

  • Europe

    • Russia

    • Germany

    • France

    • UK

  • Asia Pacific

    • China

    • India

    • Japan

    • South Korea

  • Central & South America

    • Brazil

    • Argentina

  • Middle East & Africa

    • Saudi Arabia

    • UAE