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The combined heat and power market size is forecast to increase by USD 9.35 billion and is estimated to grow at a CAGR of 6.29% between 2023 and 2028. Among the Segment Natural gas was the largest segment, valued at USD 12.25 billion in 2018. The progress in combined heat and power (CHP) system technologies with the increasing preference for combined cooling, heat, and power (CCHP), and the surge in the merging of combined heat and power with smart grid technologies is an upcoming trend of the market.
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A key factor shaping the combined heat and power market growth is the rise in the integration of combined heat and power with smart grid technologies. The integration of combined heat and power with smart grid technologies is experiencing a significant rise in the global combined heat and power market. In addition, as the energy landscape undergoes significant changes, the combination of combined heat and power and smart grid technologies presents immense opportunities for improved energy efficiency, grid flexibility, and cost savings.
Moreover, this integration is driven by the need to optimize the utilization of distributed energy resources and improve the overall performance of energy systems. In addition, one of the key drivers behind the increased integration of combined heat and power with smart grid technologies is the potential for improved energy efficiency. Furthermore, by integrating combined heat and power systems with smart grids, operators can actively manage electricity generation and consumption, optimizing the operation of combined heat and power units based on real-time demand and energy prices. Hence, such factors are positively impacting the combined heat and power market. Therefore, it is expected to drive market growth during the forecast period.
The natural gas segment is estimated to witness significant growth during the forecast period. Combined heat and power technology, also referred to as cogeneration, allows the simultaneous generation of electricity and useful heat from a single fuel source. In addition, natural gas is a popular choice for combined heat and power systems due to its clean-burning properties, efficiency, and availability. Furthermore, one of the key advantages of the natural gas segment in the global combined heat and power market is its environmental friendliness.
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Moreover, natural gas combustion emits fewer GHGs and air pollutants compared to other fossil fuels, making it a more sustainable option. In addition, the global combined heat and power market has witnessed significant growth in recent years, and the natural gas segment is a major contributor to this expansion. Furthermore, several industries, including manufacturing, healthcare, residential buildings, and commercial sectors, are increasingly adopting natural gas combined heat and power systems to meet their energy needs. In addition, these systems offer a reliable source of electricity and provide thermal energy for various processes, such as space heating, water heating, and industrial applications. Hence, such factors are fuelling the growth of this segment which in turn drives the market growth during the forecast period.
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APAC is estimated to contribute 52% to the growth of the global market during the forecast period. Technavio’s analysts have elaborately explained the regional trends and drivers that shape the market during the forecast period. One of the main factors that is contributing to the combined heat and power market growth in APAC is the favorable government initiatives to boost the adoption of combined heat and power. For example, since 2012, the feed-in tariff mechanism has been prevalent in Japan, wherein preferable tax treatments and certain subsidies are available for combined heat and power. In addition, as per the NDRC Energy 565/NEA Electricity 42 policy introduced in March 2016 in China, combined heat and power for residential heating and power is exempted from the restrictions on new coal-fired power generation capacity. Therefore, such government initiatives are positively impacting the market in the region. Therefore, it is expected to drive market growth in APAC during the forecast period.
One of the key factors driving the combined heat and power market growth is the increase in the consumption of energy globally. As per the IEA, as of 2017, the global economy grew at an average rate of 3.4% per year, which, in turn, increased the energy demand. For example, global energy demand increased by 2.1% in 2017 compared with 2016 and is further expected to rise by more than 25% by 2040. Therefore, such growth in global energy demand will be fueled by China and India, thereby contributing to more than 40% of this growth.
Moreover, factors such as the electrification of heating and transport, the rise in the number of connected devices in the residential and commercial sectors, and the digitalization of modern economies have been fuelling the electrification of the global energy system. In addition, the demand for energy services such as air conditioning is expected to rise in households in tandem with the growth in income levels. Furthermore, the use of electric motor systems in industries has been driving the growth of energy demand in the industrial sector. Hence, such factors are driving the market growth during the forecast period.
Non-economic barriers to the uptake of combined heat and power systems are one of the key challenges hindering the combined heat and power market growth. Some of the critical challenges for the uptake of fuel cell combined heat and power technology, especially from the supply chain point of view include the lack of substantial growth in the production volume of fuel cells, complex maintenance requirements and part replacement procedures, and system complexities. For example, in the ENE.FIELD project, installing fuel cells consumed one-quarter of the installation time.
Moreover, the installation of electrical connections, data communication, and other components was observed to be difficult. In addition, although the training of installers has progressed rapidly in active markets such as Germany, the lack of such training and knowledge assets can act as a barrier to the technology venturing into smaller dormant markets. Hence, such factors are negatively impacting the combined heat and power market. Therefore, it is expected to hinder the market growth during the forecast period.
The market research report includes the adoption lifecycle of the market, covering from the innovator’s stage to the laggard’s stage. It focuses on adoption rates in different regions based on penetration. Furthermore, the report also includes key purchase criteria and drivers of price sensitivity to help companies evaluate and develop their growth strategies.
Global Combined Heat and Power Market Customer Landscape
Companies are implementing various strategies, such as strategic alliances, partnerships, mergers and acquisitions, geographical expansion, and product/service launches, to enhance their presence in the market.
ABB Ltd: The company offers combined heat and power products such as Agenitor.
The research report also includes detailed analyses of the competitive landscape of the market and information about 15 market companies, including:
Qualitative and quantitative analysis of companies has been conducted to help clients understand the wider business environment as well as the strengths and weaknesses of key market players. Data is qualitatively analyzed to categorize companies as pure play, category-focused, industry-focused, and diversified; it is quantitatively analyzed to categorize companies as dominant, leading, strong, tentative, and weak.
The combined heat and power market report forecasts market growth by revenue at global, regional & country levels and provides an analysis of the latest trends and growth opportunities from 2018 to 2028.
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Combined Heat And Power Market Scope |
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Report Coverage |
Details |
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Page number |
182 |
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Base year |
2023 |
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Historic period |
2018 - 2022 |
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Forecast period |
2024-2028 |
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Growth momentum & CAGR |
Accelerate at a CAGR of 6.29% |
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Market growth 2024-2028 |
USD 9346.68 million |
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Market structure |
Fragmented |
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YoY growth 2023-2024(%) |
6.01 |
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Regional analysis |
APAC, Europe, North America, South America, and Middle East and Africa |
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Performing market contribution |
APAC at 52% |
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Key countries |
US, China, India, Japan, and Germany |
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Competitive landscape |
Leading Companies, Market Positioning of Companies, Competitive Strategies, and Industry Risks |
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Key companies profiled |
ABB Ltd., Ameresco Inc., Capstone Green Energy Corp., Caterpillar Inc., Cummins Inc., FuelCell Energy Inc., General Electric Co., Helec Ltd., HoSt Holding B.V., Kawasaki Heavy Industries Ltd., Kraft Power Corp., Mitsubishi Heavy Industries Ltd., MTT bv, Robert Bosch GmbH, Rolls Royce Holdings Plc, Siemens Energy AG, Traton SE, Veolia Environnement SA, Wartsila Corp., and 2G Energy AG |
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Market dynamics |
Parent market analysis, Market growth inducers and obstacles, Fast-growing and slow-growing segment analysis, COVID 19 impact and recovery analysis and future consumer dynamics, Market condition analysis for forecast period |
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Customization purview |
If our report has not included the data that you are looking for, you can reach out to our analysts and get segments customized. |
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1 Executive Summary
2 Market Landscape
3 Market Sizing
4 Historic Market Size
5 Five Forces Analysis
6 Market Segmentation by Product
7 Market Segmentation by End-user
8 Customer Landscape
9 Geographic Landscape
10 Drivers, Challenges, and Trends
11 Vendor Landscape
12 Vendor Analysis
13 Appendix
Research Framework
Technavio presents a detailed picture of the market by way of study, synthesis, and summation of data from multiple sources. The analysts have presented the various facets of the market with a particular focus on identifying the key industry influencers. The data thus presented is comprehensive, reliable, and the result of extensive research, both primary and secondary.
INFORMATION SOURCES
Primary sources
Secondary sources
DATA ANALYSIS
Data Synthesis
Data Validation
REPORT WRITING
Qualitative
Quantitative
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