Distributed Generation Market: Increasing share of renewable energy in the power generation

 The global distributed generation market is expected to grow from an estimated USD 60.04 Billion in 2017 to USD 103.38 Billion by 2022, at a CAGR of 11.48%. This growth can be attributed to the increased global demand for electricity, decreasing costs of solar technology, and rising efforts to reduce global greenhouse gas emissions. The growing demands for electric power accompanied with regulatory incentives for clean energy generation have shifted the focus toward distributed generation technologies.

Distributed generation refers to geographically dispersed power generation sources. It comprises both controllable sources, such as generators, and non-controllable sources, such as solar and wind. Distribution generation is a decentralized energy which is generated or stored by a variety of small, grid connected generators referred to as Distributed Energy Resources (DERs) or distributed energy resource systems. The demand for energy from distributed energy resources is growing globally due to a number of reasons, such as planned rolling blackouts, power quality problems, unexpected utility power outages, and increases in power costs, among others.

Renewable energy is a naturally occurring source of energy that can be easily replenished, and plays an important role in reducing greenhouse gas emissions. Renewable energy is more expensive when compared with fossil fuel-based power generation. Owing to environmental conservation, and rising awareness, countries around the globe are veering towards renewable sources for power generation. The increasing share of renewables in the power generation mix will positively impact the market.

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The distributed generation technology is segmented into solar PV, wind, microturbines, reciprocating engines, fuel cells, and gas turbines, of which, solar PV is the fastest growing segment. The decreasing costs of solar installations, attractive incentives, and greenhouse gas emission restrictions are expected to drive the adoption of solar PV technology for power generation.

The on-grid segment is expected to hold the largest share of the distributed generation market

On-grid systems are cost-effective and convenient to install. The global market for distributed generation facilities that employ grid-tied arrangements has been the highest. Driven by the capability to provide perfect solutions for various end-users and contribution to reduce harmful emissions from fossil fuel power plants, the segment is expected to grow at a decent pace during the forecast period.

The reciprocating engines segment is expected to be the largest in the distributed generation market

The reciprocating engines segment is expected to be the largest segment of the distributed generation market. Due to their small size, low unit cost, and useful thermal output, these engines are widely used for power generation. Increased combined heat and power installations and the demand for flexible and quick start-up technologies for power generation are the main reasons for a large market share held by the segment.

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Europe: Expected to be the leading market for distributed generation

Europe is expected to dominate the market during the forecast period, owing to the continued increase in energy consumption mainly from by the industrial and commercial sectors, which contributed to the largest demand for distributed generations. The demands from the IT and telecommunication sectors are also driving the distributed generation market.

Some of the leading players in the Distributed Generation Market include Siemens (Germany), GE (US), Schneider (France), Mitsubishi (Japan), and Capstone (US).

Energy as a Service Market Upcoming Trend by Worldwide Industry Growth, Statistics, and Opportunities to 2024

The global Energy as a Service Market is projected to reach USD 86.9 billion by 2024 from an estimated USD 52.0 billion in 2019, at a CAGR of 10.8%. This growth can be attributed to the new revenue generation streams for utilities, increased distributed energy resources, decreasing cost of renewable power generation and storage solutions, and availability of federal and state tax benefits for energy efficiency projects.

The energy supply services segment is expected to hold the largest share of the energy as a service market

The energy supply services segment is projected to have the largest market share during the forecast period. This is mainly because of the increase in offerings of energy supply, which includes distributed energy generation solutions such as solar PV, combined heat and power, diesel and natural gas gensets, microturbines, and fuel cells to improve energy supply, which is also contributing to the growth of the market.

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Energy as a service model mainly supports renewable energy as it lowers energy costs, reduces carbon footprint, ensures high energy efficiency, and is environment-friendly. It gives the consumers the flexibility of choice on ownership, pricing, and financing. It also helps the operators customize energy generation designs based on consumer requirement, which are modern and robust. It enables easy and rapid integration of distributed generation and energy storage assets.

The commercial segment is expected to be the fastest growing segment of the energy as a service market

The energy as a service market by end-user is segmented into commercial and industrial users. The commercial segment includes establishments such as healthcare, educational institution, airports, data centers, leisure centers, warehouses, hotels, and others. The growth of this segment can be attributed to the increasing need for energy efficiency. This is expected to increase the demand for energy as a service market during the forecast years. The US Department of Energy (DOE) estimates that at least 25% of the USD 6 billion that colleges and universities spend annually on energy could be saved through better energy management. The energy as a service model helps the educational institutions save money through energy savings. According to the American Council for an Energy-Efficient Economy, these establishments account for about 19% of the energy consumed in the US.  More than half the energy used by commercial buildings goes toward heating and lighting.

North America: The leading market for energy as a service

In this report, the energy as a service market has been analyzed with respect to 5 regions, namely, North America, Europe, Asia Pacific, and the Rest of the World. North America is estimated to dominate the global energy as a service market in 2019 owing to the increase in energy efficiency projects and growth in distributed energy resources in countries such the US, Canada, and Mexico. The integration of distributed energy resources with utility energy efficiency programs continued the growth of energy efficiency in the region, which also helps in ensuring reliability and meeting the energy goals. Private utility models have emerged because of the growing power sector trend for energy as a service. Also, increase in energy efficiency investments is further expected to propel the growth of the market in the region.

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The major players in the global Energy as a Service Market are Schneider Electric (France), Engie (France), Siemens (Germany), Honeywell (US), Veolia (France), Enel X (Italy), and EDF Renewable Energy (California).