Marine Gensets Market

Market Overview

The global marine gensets market was valued at USD 5.75 billion in 2023. It is estimated to reach USD 8.08 billion by 2032, growing at a CAGR of 3.86% during the forecast period (2024–2032). In recent years, there has been a rapid surge in the maritime trade, which increases the demand for marine vessels, boosting the global marine gensets market. Moreover, the rapid surge in population has led to a rapid rise in the energy demand worldwide, which increases the number of offshore projects being undertaken, thereby creating opportunities for market growth.

Marine gensets, short for marine generators, are specialized power generation systems designed in marine environments, primarily on ships, boats, and other maritime vessels. These gensets provide electrical power to various onboard systems and equipment, including propulsion systems, navigation instruments, lighting, HVAC (heating, ventilation, and air conditioning) systems, communication devices, and more.

Marine gensets are typically powered by diesel engines, although options are available for alternative fuels such as natural gas or LPG. Depending on the particular needs of the vessel, they might vary in size and capacity; larger vessels need more powerful gensets to meet their energy requirements. Marine gensets are crucial in providing electrical power for various onboard systems and operations, making them essential components of modern marine vessels.

Market Dynamics

Global Marine Gensets Market Drivers:

Growing Maritime Trade

Growing maritime trade is a key driver of the marine gensets market due to the increasing demand for marine vessels worldwide. UNCTAD predicts that global seaborne trade will rise by 2.4% in 2023, following a 0.4% decline in 2018. Despite being lower than the long-term growth rate of approximately 7% over the last three decades, containerized trade is expected to increase by 1.2% in 2023 and grow by more than 3% from 2024 to 2028.

As global trade expands, there is a rising need for cargo ships, tankers, container ships, and other vessels to transport goods across oceans. These vessels require reliable power generation systems to support their onboard operations, including propulsion, navigation, communication, refrigeration, and cargo handling. Moreover, marine gensets are crucial in providing the necessary electrical power for these operations, making them essential components of modern marine vessels. As maritime trade volumes increase, the demand for marine gensets is expected to grow correspondingly, driving market expansion in the marine gensets sector.

Global Marine Gensets Market Restraint:

Stringent Environmental Regulations

Stringent environmental regulations pose a significant restraint on the marine gensets market. With increasing concerns about air and water pollution from maritime vessels, governments worldwide are imposing stricter limits on emissions of pollutants such as sulfur dioxide, nitrogen oxides, and particulate matter. These regulations compel vessel owners to invest in cleaner and more environmentally friendly technologies to reduce their environmental footprint.

However, adherence to these regulations can be expensive for vessel owners, particularly when retrofitting existing vessels with marine gensets that meet stringent emission standards. Upgrading to cleaner-burning engines or adopting alternative power sources like LNG (liquefied natural gas) or hydrogen fuel cells requires substantial equipment, infrastructure, and training investments. As a result, the high costs associated with meeting environmental regulations may deter vessel owners from investing in marine gensets, especially if they perceive alternative compliance options or propulsion technologies as more cost-effective or less disruptive to their operations.

Global Marine Gensets Market Opportunities:

Expansion of the Offshore Energy Sector 

Global energy demand is projected to rise 5% by 2030, with oil and natural gas accounting for almost half the requirement. The uptake rate of new offshore upstream projects is anticipated to rise in the upcoming years to fulfill the growing demand. Global oil and gas companies are seeking new projects to take advantage of the prolonged period of cheap oil prices. This is projected to boost the need for marine vessels in offshore exploration, production, and decommissioning tasks.

For instance, BP Plc, a leading British oil and gas company, obtained exploration rights for two offshore blocks in Indonesia, named Agung I and Agung II, in March 2022. They achieved this by participating in Indonesia's second round of the 2021 Oil and Gas Working Area (WK) Bid Round. The blocks are largely uncharted and are expected to hold significant resource opportunities. Thus, expanding offshore energy projects, particularly in regions with abundant offshore resources, drives the demand for marine gensets.

Regional Analysis

Asia-Pacific Dominates the Global Market

Based on region, the global marine 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 marine gensets market shareholder and is expected to expand substantially during the forecast period. The Asia-Pacific region hosts some of the world's most active shipping routes and ports, establishing it as a crucial center for maritime trade. The cargo handling by major ports in India increased by 10.41% compared to the previous year, reaching a record high of 795 million tonnes in FY23. These factors bode well for the nation's economic growth and position in the global maritime industry. The Indian Government anticipates significant expansion in the industry to increase the overall cargo handling capacity at its sea and river ports by around 300% by 2047. The rising amount of commodities being transported by sea within the region is leading to a higher need for marine vessels that have dependable power production equipment such as gensets.

Furthermore, government efforts to support regional shipbuilding and maritime sectors are boosting the need for marine gensets in the region. The government has initiated ambitious schemes like Sagarmala and Mausam to utilize the country's maritime resources. India has introduced fiscal and non-fiscal incentives to support firms involved in developing, maintaining, and operating ports, inland waterways, and shipbuilding to boost the shipping and port industry. The Maritime India Vision 2030, with more than 150 programs, also seeks to strengthen the maritime sector. Allowing 100% foreign direct investment (FDI) through government and automated procedures has boosted growth in the sector, enabling experienced multinational companies to contribute their skills. Consequently, all these factors are estimated to boost the regional market growth.

The European region is experiencing rapid growth due to its flourishing coastal and maritime tourism sector. Greece, Italy, and France are renowned worldwide for their appeal as top destinations for marine tourism. Many tourists from Europe and other countries prefer the coastal regions of the EU because of their beauty, cultural variety, and high quality of life. As a result, coastal and marine tourism has become a major sector in the tourism business.

Furthermore, government efforts to encourage maritime and coastal tourism in this region. For instance, in February 2014, the EU Commission adopted the Communication "A European Strategy for More Growth and Jobs in Coastal and Maritime Tourism." The document presented an innovative framework to enhance coastal and maritime tourism in Europe to utilize this growing industry's potential fully. This will boost the marine gensets market by increasing the demand for recreational boating and yachting activities. Moreover, it is anticipated that market leaders' introduction of technologically advanced marine gensets will generate growth opportunities. For instance, in September 2022, Volvo Penta, a company based in Sweden, launched a new series of variable-speed generator sets 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 marine gensets market is segmented by vessel type, fuel, and capacity.

Based on vessel type, the global marine gensets market is bifurcated into commercial, defense, and offshore vessels. 

The commercial vessel segment is estimated to own the highest market share. A commercial marine vessel is any watercraft or ship used for commercial purposes rather than personal or recreational use. These vessels are typically employed in various industries, such as shipping, transportation, fishing, offshore energy, tourism, and maritime logistics. They are essential for global trade, transportation, resource extraction, and economic activities, supporting various industries and facilitating the movement of goods, people, and resources across the world's oceans and waterways.

Moreover, the commercial vessel segment is divided into bulkers, container ships, cargo vessels, LNG carriers, LPG carriers, pure car carriers, and chemical carriers. The segment is expected to dominate the market due to the increasing maritime trade and high global demand for natural gas. The rising demand for retrofits of commercial vessels and long-voyage expeditions is anticipated to boost the commercial vessels segment. 

Based on fuel, the global marine gensets market is divided into diesel, gas, and hybrid fuel.

Diesel-based marine gensets are power generation systems specifically designed for marine applications, utilizing diesel engines as their primary power source. Diesel engines are favored for marine gensets due to their reliability, efficiency, and availability of fuel. They offer high power output and torque, making them well-suited for powering various onboard systems and equipment on marine vessels, including propulsion systems, navigation instruments, lighting, and auxiliary machinery.

Diesel-based marine gensets are commonly used in commercial and recreational vessels, including cargo ships, tankers, ferries, fishing boats, and yachts. They provide a dependable electrical power source for continuous operation, even in challenging marine environments characterized by saltwater exposure, vibrations, and fluctuations in temperature and humidity. Thus, diesel-based marine gensets are crucial in ensuring the reliable and efficient operation of marine vessels worldwide.

Based on capacity, the global marine gensets market is segmented into less than 1,000 kW, 1,001-3,000 kW, 3,001- 10,000 kW, and more than 10,000 kW.

Marine gensets with a capacity exceeding 10,000 kW are large-scale power generation systems specifically designed for powering massive vessels or offshore installations. These high-capacity gensets typically feature multiple diesel engines or gas turbines working in parallel to generate electricity. They are commonly used in large container ships, bulk carriers, cruise ships, and offshore platforms requiring substantial power for propulsion, onboard operations, and auxiliary systems.

The design and installation of marine gensets with capacities exceeding 10,000 kW involve complex engineering considerations, including space constraints, weight distribution, fuel storage, and emissions control. These gensets may also incorporate advanced technologies such as selective catalytic reduction (SCR) systems, exhaust gas recirculation (EGR), and waste heat recovery systems to enhance efficiency and comply with stringent emissions regulations.

Recent Developments

• September 2023- MAN Energy Solutions announced that it will enhance its genset offering by adding a methanol-capable auxiliary engine in response to the increasing popularity of dual-fuel propulsion. The new L21/31DF-M genset is based on the existing L21/31 small-bore, four-stroke platform.
• October 2023- CMB.TECH, the technology division of CBM Shipping in Belgium, and DBR BV, a Dutch industrial equipment provider, collaborated to create a cutting-edge high-speed hydrogen dual-fuel marine genset. This technology will be initially used in a fleet of commissioning service operation vessels (CSOVs).