Genset Market Size, Share & Trends Analysis Report By Power Rating (Up to 100 kVA, 100–350 kVA, 350–1000 kVA, Above 1000 kVA), By Fuel Type (Diesel, Natural Gas, Propane), By Applications (Standby Power, Peak Shaving, Prime/Continuous Power), By End-User (Industrial, Commercial, Residential) and By Region(North America, Europe, APAC, Middle East and Africa, LATAM) Forecasts, 2024-2032

Market Overview

The global gensets market size was valued at USD 23.28 billion in 2023 and reached USD 24.50 billion in 2024. It is estimated to reach USD 36.89 billion by 2032, growing at a CAGR of 5.25% during the forecast period (2024–2032). In recent years, there has been a rapid rise in the population, which has, in turn, increased the energy demand worldwide. This surge in the energy demand increases the demand for gensets as they offer a definitive power source, thereby boosting the global gensets market. Moreover, key players have raised the launch of novel and advanced gensets, thereby creating opportunities for market growth.

A genset, short for a generator set, is a compact unit consisting of an engine and an electric generator designed to provide electricity when regular power sources are unavailable or unreliable. The engine, typically fueled by diesel, gasoline, natural gas, or propane, drives the generator to produce electrical energy. Gensets are commonly used in various applications, including residential homes, commercial buildings, construction sites, and remote areas where grid power is inaccessible.

These sets are crucial for ensuring continuous power supply during emergencies such as blackouts, natural disasters, or in locations where the power grid infrastructure is inadequate. Gensets come in various sizes and power capacities to meet different energy demands. They offer a reliable and independent source of electricity, providing peace of mind and enabling operations to continue uninterrupted in critical situations. Routine maintenance is essential to guarantee genset longevity and peak performance.

Highlight

• 350–1000 kVA dominates the power ratings segment.
• Asia-Pacific is estimated to be the largest shareholder in the market.

Market Dynamics

Global gensets market drivers

Increasing energy demand 

According to projections, the global population is anticipated to increase by more than 8.5 billion in 2030 and 9.7 billion by 2050. Given the current exponential growth in the global population, it is projected that the globe would necessitate an abundance of energy twice the amount currently produced.

Moreover, the increased regional manufacturing activities and improved living standards will increase energy consumption. According to the IEA, it is projected that the global electric-power generating capacity will experience a growth ranging from 50% to 100% by the year 2050. Thus, increasing energy demand, particularly in emerging economies, exerts pressure on existing power infrastructure, leading to frequent blackouts and load shedding.

Gensets emerge as a critical solution to bridge the gap, offering reliable backup power. Industries, businesses, and households seek gensets to ensure uninterrupted operations amidst rising energy consumption. This trend propels the genset market forward, as it caters to the growing need for continuous power supply in regions experiencing surging energy demands and strained grid systems.

Global gensets market restraint

Regulatory constraints

Regulatory constraints in the genset market primarily relate to emissions and noise pollution standards imposed by governmental bodies. Compliance with these regulations often necessitates costly modifications or the adoption of cleaner technologies, increasing the overall cost of genset ownership. Zoning regulations may restrict the use of gensets in certain areas, further limiting their market potential.

These constraints compel manufacturers to invest in research and development to meet regulatory requirements, potentially slowing innovation and hindering market growth. Moreover, navigating complex regulatory landscapes can increase administrative burdens for both manufacturers and end-users, deterring investment in genset solutions. Thus, regulatory constraints pose significant challenges to the genset market, influencing product design, distribution, and adoption.

Global gensets market opportunities

Launch of novel gensets

The market players in the global gensets industry are innovating and advancing gensets technology. For instance, in August 2023, Mitsubishi Heavy Industries Engine & Turbocharger, Ltd. (MHIET) has recently introduced the MGS3100R, a new addition to the MGS-R family. MGS3100R is specifically designed to handle the increased power requirements of emergency gensets that provide electricity during power outages. MHIET's plants in Singapore and Vietnam manufacture and distribute all MGS to customers worldwide, focusing on the Asia-Pacific area.

Furthermore, in July 2023, Tata Motors introduced an innovative range of gensets in India. These gensets comply with CPCB IV+ (Central Pollution Control Board IV+) regulations and are available in configurations ranging from 25kVA to 125kVA. The new series of gensets are claimed to have improved fuel efficiency and a robust block loading capacity, reducing running costs. The engines that drive these gensets have been meticulously designed, developed, and tested at the company's research and development department. They are exceptionally well-suited for a wide range of applications. Such factors are estimated to create opportunities for market expansion.

Regional Analysis

Asia-pacific dominates the global market

Based on region, the global gensets market is bifurcated into North America, Europe, Asia-Pacific, Latin America, and the Middle East and Africa.

Asia-Pacific is the most significant global gensets market shareholder and is expected to expand substantially during the forecast period. The Asia-Pacific region is attracting significant interest in the market because of the growing frequency of power outages and the urgent demand for uninterrupted power supply in industrial and commercial sectors. The key players in the market are also launching new gensets. For instance, in September 2023, Cummins India is actively promoting the sustainability agenda to guarantee that its products comply with the CPCBIV+ emission standards, which came into effect on July 1 for diesel gensets. The company's power systems team developed and launched gensets that were compliant with CPCBIV+ regulations in the same month. The Central Pollution Control Board (CPCB) has established strict emission limits for power production engines, which are widely regarded as one of the most restrictive in the industry.

Furthermore, in December 2023, Jakson Group demonstrated its strong dedication to sustainable and advanced power backup solutions by opening a modern manufacturing plant in Phaltan, Maharashtra. The company is projected to manufacture approximately 2500 gensets annually at this facility. These gensets will have power capacities ranging from 250KVA to 3500KVA and will include gensets that meet the newest CPCB IV+ regulations. The CPCB IV+ gensets can meet a wide range of power needs and are engineered to be fuel-efficient while emitting fewer pollutants. This aligns with our dedication to offering sustainable energy solutions. This plant significantly increases Jakson's manufacturing capability to around 15,000 gensets annually. Consequently, all these factors are estimated to boost the regional market growth.

Europe is expected to grow at a significant pace. One significant factor driving the European region market is the increasing demand for reliable backup power solutions, particularly in industries such as healthcare, data centers, and telecommunications, where uninterrupted power supply is critical. The growing emphasis on energy security and resilience against power outages, especially in regions prone to extreme weather events, propels the adoption of gensets.

Moreover, it is anticipated that market leaders' introduction of technologically advanced gensets will generate growth opportunities. For instance, in September 2022, Volvo Penta, a company based in Sweden, launched a new series of variable-speed gensets designed for maritime vessels. The new variable speed marine generator sets are said to be a crucial factor in enabling electric propulsion for maritime vessels.

Segmental Analysis

The global gensets market is segmented by power ratings, fuel type, application, and end-user.

Based on power ratings, the global gensets market is segmented into up to 100 kVA, 100–350 kVA, 350–1000 kVA, and above 1000 kVA. 

The 350–1000 kVA segment is estimated to own the highest market share. A 350–1000 kVA genset is a generator set capable of producing electrical power within the range of 350 to 1000 kilovolt-amperes (kVA). This rating indicates the generator's capacity to supply electricity to various applications, such as industrial facilities, large commercial buildings, data centers, hospitals, or critical infrastructure during power outages or in remote areas where the grid connection is unavailable. Generators of this size are typically diesel-powered and designed for continuous or standby operation. They feature robust engines and alternators capable of handling heavy loads and providing reliable power output over extended periods.

Additionally, they often incorporate advanced control systems for efficient operation and remote monitoring. These gensets are crucial in ensuring uninterrupted power supply for essential operations, providing backup power during emergencies, and supporting continuous operations in environments where grid reliability is a concern.

Based on fuel type, the global gensets market is divided into diesel, natural gas, and propane.

Natural gas is widely used in gensets (generator sets) for its numerous advantages. Gensets powered by natural gas offer higher efficiency and reliability than traditional diesel generators. Natural gas combustion produces lower emissions of pollutants such as nitrogen oxides, sulfur dioxide, and particulate matter, making it an environmentally friendly option. Additionally, natural gas is readily available and often more affordable than diesel, contributing to cost savings. Gensets fueled by natural gas also require less maintenance, as the cleaner combustion reduces the buildup of deposits in the engine. Thus, using natural gas in gensets provides a cleaner, more efficient, and cost-effective solution for generating electricity in various residential, commercial, and industrial applications.

Based on application, the global gensets market is bifurcated into standby power, peak shaving, and prime/continuous power.

Gensets, short for generator sets, are often utilized for peak shaving, a strategy employed to manage electricity demand during periods of high consumption. During peak times, such as hot summer afternoons or cold winter mornings, electricity usage surges, straining the grid and potentially leading to brownouts or blackouts. Gensets are deployed strategically to supplement the grid during these peak periods, reducing the strain and ensuring uninterrupted power supply. By operating gensets during these peak times, businesses and utilities can avoid costly peak demand charges imposed by energy providers and enhance overall grid stability. Gensets offer flexibility in power generation, allowing for rapid response to fluctuating demand and serving as a reliable backup during emergencies or grid failures.

Based on end-users, the global gensets market is bifurcated into commercial, industrial, and residential.

In residential settings, gensets or generator sets are reliable backup power sources during outages or when off-grid living is necessary. These units are typically fueled by diesel, gasoline, or propane and can supply electricity to essential appliances like refrigerators, lights, and heating systems. Gensets offer peace of mind during emergencies, ensuring uninterrupted power supply for critical functions such as medical equipment or communication devices.

Additionally, in areas prone to frequent power interruptions or unreliable grid infrastructure, gensets provide a consistent power supply, enhancing comfort and convenience. However, they require regular maintenance and appropriate safety measures to operate effectively and safely. Thus, gensets are invaluable assets in residential settings, providing resilience and stability in the face of power challenges.

Recent Developments

• September 2023- Kirloskar Oil Engines (KOEL), a renowned player in the power generation sector, introduced its newest collection of gensets that comply with the stringent CPCB IV+ regulations. These state-of-the-art gensets exemplify KOEL's steadfast commitment to providing high-performance, fuel-efficient, and environmentally conscious solutions that comply with the strict emission standards imposed by the Central Pollution Control Board (CPCB).
• March 2024- Recon Technologies Pvt Ltd, the authorized manufacturer of original equipment for Mahindra Powerol Genset, announced the release of a new line of diesel generators compatible with CPCBIV+ emission standards. The authorized distributor of Mahindra Powerol in Telangana and Andhra Pradesh is prepared to provide the complete range of gensets up to 625 KVA that adhere to Hyderabad's newest CPCBIV+ emission standards.