Distributed Energy Generation Market Analysis APAC,Europe,North America,South America,Middle East and Africa - US,China,India,Germany,UK - Size and Forecast 2023-2027

Distributed Energy Generation Market Size 2023-2027

The distributed energy generation market size is estimated to increase by USD 179.28 billion and grow at a CAGR of 11.26% between 2022 and 2027. Market expansion hinges on various factors, such as the shift towards electric vehicles (EVs) and the decreasing cost of solar PV panels, alongside heightened investments in renewable energy. However, challenges persist, including the elevated costs associated with equipment and installation, the intermittent nature of solar power generation, and insufficient awareness and education among consumers. These obstacles underscore the intricate landscape of the renewable energy sector, where balancing affordability, reliability, and environmental sustainability is paramount. Stakeholders must navigate regulatory frameworks and invest in innovative solutions to address these challenges while promoting widespread adoption of renewable energy technologies. As the market continues to evolve, strategic initiatives and educational campaigns become essential for fostering sustainable growth and fostering a more resilient energy future.

What will be the Size of the Distributed Energy Generation Market During the Forecast Period?

To learn more about this report, View Report Sample

Market Segmentation

This market report extensively covers market segmentation by end-user (residential, commercial, and industrial), technology (solar PV, hydro power, fuel cells, wind turbine, and others), and geography (APAC, Europe, North America, South America, and Middle East and Africa). It also includes an in-depth analysis of drivers, trends, and challenges. Furthermore, the report includes historic market data from 2017 to 2021.

The market share growth by the residential segment will be significant during the forecast period. The market for distributed energy generation is driven by increasing electricity demand and the adoption of renewable energy sources, such as wind and solar, in residential and commercial sectors. Technologies like reciprocating engines, turbines, biomass, and microgrids equipped with batteries and solar panel installations are key components of this market. Grid expansion and environmental concerns are also significant factors, leading to the use of green transformers, micro grid infrastructure, fuel cell technology, and semiconductor materials.

Get a glance at the market contribution of various segments View the PDF Sample

The residential segment was valued at USD 65.97 billion in 2017 and continue to grow by 2021. Renewable energy sources, including solar energy, hydropower, bioenergy, and battery storage, are becoming more cost-effective due to falling costs and urbanization. Off-grid places, such as remote areas, are also benefiting from this trend through the use of microgrids, solar panels, wind turbines, and various turbine types. Utilities are adapting to these changes by integrating distributed energy generation into their systems, while land use and fuel cell technology are also playing crucial roles in this market's growth.

Key Region

For more insights on the market share of various regions Download PDF Sample now!

APAC is estimated to contribute 33% 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. In the Asia-Pacific (APAC) region, the industrial sector's shift towards distributed energy generation is driven by growing environmental awareness and the need to reduce reliance on fossil fuels. This transition is in response to concerns over energy security, air pollution, and climate change. Renewable energy sources, such as solar and wind, are becoming increasingly popular for distributed energy generation due to their cleaner and more sustainable nature. Hybrid energy systems, which combine multiple renewable energy sources, are also gaining traction as they offer greater efficiency and reliability. Governments in the APAC region are supporting this trend through policies and regulations that encourage adoption, such as China's feed-in tariffs and subsidies for solar and wind power installations.

Market Dynamics and Customer Landscape

The Distributed Energy Generation (DEG) market encompasses various renewable energy sources and technologies, including wind, solar, biomass, microgrids, batteries, and fuel cell technology. Electricity demand is driving the growth of this market as consumers seek to increase energy efficiency and reduce reliance on traditional power sources. Renewable energy sources, such as wind and solar, are becoming increasingly popular for DEG applications due to their environmental benefits and decreasing costs. Wind energy is generated through turbines, while solar energy is harnessed through solar panels. Biomass is another renewable energy source that can be used for DEG through reciprocating engines and micro turbines. Microgrids and batteries play a crucial role in DEG by providing energy storage and grid support. Grid expansion is also a key factor in the growth of DEG, as it enables the integration of renewable energy sources into the power grid. Environmental concerns and efficiency are major considerations in the DEG market. Energy efficiency standards are being implemented to ensure that DEG systems are as efficient as possible. Green transformers and advanced microgrid infrastructure are also being developed to reduce the carbon footprint of DEG systems. Combustion engines, such as those used in micro hydropower and combustion turbines, continue to play a role in DEG but are facing increasing competition from renewable energy sources. Overall, the DEG market is expected to continue growing as the world transitions to a more sustainable and decentralized energy system.

Key Market Driver

The transition towards electric vehicles (EVs) is one of the key factors driving the market. Distributed energy generation plays a significant role in meeting the rising electricity demand for Electric Vehicle (EV) charging, particularly at residential, commercial, and public locations. Renewable energy sources, such as solar panels powered by the Sun and wind turbines, can provide clean and sustainable energy for EV charging stations. Reciprocating engines, turbines fueled by biomass, and microgrids with batteries offer alternative solutions for off-grid EV charging. Integrating EV charging with distributed energy generation enables optimized charging schedules, reduced peak demand, and increased use of renewable energy resources.

Microgrid infrastructure, including green transformers, fuel cell technology, and semiconductor materials, supports the integration of various energy sources. Utilities and land use planning must address environmental concerns and efficiency standards to accommodate the growing demand for renewable energy and EV charging. Key distributed energy generation technologies include solar panel installation, wind turbines, hydropower, bioenergy, battery storage, and fuel cells. Falling costs and urbanization drive the adoption of distributed energy generation for EV charging in residential, commercial, and off-grid places. However, increased preference for EVs across the globe is expected to enhance the overall growth of the global market during the forecast period.

Significant Market Trends

A key factor shaping the market growth is the increasing renewable energy penetration. The market for distributed energy generation is experiencing significant growth due to the increasing demand for electricity from renewable energy sources. Solar and wind energy, derived from the sun and wind, respectively, are leading this trend. Technological advancements in reciprocating engines, turbines, and biomass have expanded the market. Microgrids, batteries, and solar panel installations are key components of this transition, driven by falling costs, supportive policies, and environmental concerns. Grid expansion and energy efficiency standards are also crucial factors. Green transformers, microgrid infrastructure, fuel cell technology, and utilities are essential elements of this shift.

Land use in off-grid places is being optimized for solar energy, renewables like hydropower and bioenergy, and battery storage. Fuel cells, semiconductor materials, and various types of turbines, including wind and micro turbines, are also contributing to this transition. Urbanization and the adoption of renewables in residential and commercial sectors are further fueling the market's expansion. However, growing awareness of the environmental impacts of fossil fuel-based energy generation has led to renewable energy adoption, which is expected to increase the growth of the global market during the forecast period.

Major Market challenge

High equipment and installation costs are one of the key challenges hindering the market. The distributed energy generation market caters to the growing electricity demand through the utilization of various renewable energy sources, including wind and sun. High-quality components, advanced technology, and skilled labor contribute to the substantial investment required for installations, such as solar panels or wind turbines. Additional infrastructure, including power inverters, energy storage systems, and grid interconnection equipment, further increases costs. Solar PV installations necessitate a large land area and significant upfront expenses. Renewable energy sources, such as reciprocating engines, turbines, biomass, and microgrids, rely on batteries for energy storage and grid expansion. Environmental concerns and efficiency drive the adoption of green transformers, microgrid infrastructure, fuel cell technology, and energy efficiency standards.

Utilities and off grid places benefit from renewables, solar energy, hydropower, bioenergy, battery storage, fuel cells, semiconductor materials, and wind turbines. Falling costs, urbanization, and the shift towards clean source of energy continue to drive market growth. Technologies like micro grids, micro turbines, combustion turbines, micro hydropower, residential, commercial, and industrial applications are gaining popularity. However, high costs associated with distributed energy generation is expected to hinder the growth of the global market in focus during the forecast period.

Key Market Customer Landscape

The market 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 Market Customer Landscape

Who are the Major Distributed Energy Generation Market Players?

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.

Ansaldo Energia Spa: The company offers distributed power generation solutions such as electric generators for hydroelectric, geothermal, and fossil fired plants for a full century. 

The research report also includes detailed analyses of the competitive landscape of the market and information about 20 market vendors, including:

• Bloom Energy Corp.
• Canadian Solar Inc.
• Capstone Green Energy Corp.
• Caterpillar Inc.
• Cummins Inc.
• Doosan Corp.
• ENERCON GmbH
• First Solar Inc.
• FuelCell Energy Inc.
• General Electric Co.
• Mitsubishi Electric Corp.
• Nextera Energy Inc.
• Orsted AS
• Rolls Royce Holdings Plc
• Schneider Electric SE
• Siemens AG
• Sunverge Energy Inc.
• Toyota Motor Corp.
• Vestas Wind Systems AS

Qualitative and quantitative analysis of vendors 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 vendors as pure play, category-focused, industry-focused, and diversified; it is quantitatively analyzed to categorize vendors as dominant, leading, strong, tentative, and weak.

Segment Overview

The market research report provides comprehensive data (region wise segment analysis), with forecasts and estimates in "USD Billion" for the period 2023 to 2027, as well as historical data from 2017 to 2021 for the following segments

• End-user Outlook 
  • Residential
  • Commercial
  • Industrial

• Technology Outlook
  • Solar PV
  • Hydro power
  • Fuel cells
  • Wind turbine
  • Others

• Region Outlook
  • North America
    • The U.S.
    • Canada
  • Europe
    • The U.K.
    • Germany
    • France
    • Rest of Europe
  • APAC
    • China
    • India
    • Japan
  • South America
    • Chile
    • Argentina
    • Brazil
  • Middle East & Africa
    • Saudi Arabia
    • South Africa
    • Rest of the Middle East & Africa

Market Analyst Overview

The Distributed Energy Generation (DEG) market refers to the production and sale of electricity from small-scale energy sources located near the consumers. These sources include solar, wind, micro hydro, and biomass. The DEG market is gaining significant traction due to the increasing demand for renewable energy and the need for energy security and independence. The solar segment holds the largest market share in the DEG market, followed by wind energy. Micro hydro and biomass are also expected to grow at a steady pace in the coming years. The market is driven by various factors, such as government initiatives, technological advancements, and the increasing awareness of environmental sustainability.

The DEG market is witnessing significant growth in regions such as Europe, North America, and Asia Pacific. The European market is expected to dominate the global DEG market due to the presence of a well-established renewable energy sector and supportive government policies. The market is highly competitive, with key players such as Siemens, GE, and Siemens Gamesa Renewable Energy leading the market. These companies are focusing on expanding their product portfolios and increasing their presence in emerging markets to gain a larger market share. In conclusion, the DEG market is expected to grow at a significant rate in the coming years due to the increasing demand for renewable energy and government initiatives to promote the use of clean energy sources. The market is highly competitive, with key players focusing on expanding their product offerings and increasing their presence in emerging markets. Solar panel manufacturing costs, along with advancements in technology like unmanned aerial vehicles (UAVs) and portable power generation units, contribute to reducing Greenhouse gas (GHG) emission. These innovations drive the transition towards cleaner and more sustainable energy solutions.

Distributed Energy Generation Market Scope
Report Coverage	Details
Page number	166
Base year	2022
Historic period	2017-2021
Forecast period	2023-2027
Growth momentum & CAGR	Accelerate at a CAGR of 11.26%
Market growth 2023-2027	USD 179.28 billion
Market structure	Fragmented
YoY growth 2022-2023(%)	10.78
Regional analysis	APAC, Europe, North America, South America, and Middle East and Africa
Performing market contribution	APAC at 33%
Key countries	US, China, India, Germany, and UK
Competitive landscape	Leading Vendors, Market Positioning of Vendors, Competitive Strategies, and Industry Risks
Key companies profiled	Ansaldo Energia Spa, Bloom Energy Corp., Canadian Solar Inc., Capstone Green Energy Corp., Caterpillar Inc., Cummins Inc., Doosan Corp., ENERCON GmbH, First Solar Inc., FuelCell Energy Inc., General Electric Co., Mitsubishi Electric Corp., Nextera Energy Inc., Orsted AS, Rolls Royce Holdings Plc, Schneider Electric SE, Siemens AG, Sunverge Energy Inc., Toyota Motor Corp., and Vestas Wind Systems AS
Market dynamics	Parent market analysis, Market forecasting, 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
Customization purview	If our Market forecast report has not included the data that you are looking for, you can reach out to our analysts and get segments customized.

View PDF Sample

What are the Key Data Covered in this Market Research Report?

• CAGR of the market during the forecast period
• Detailed information on factors that will drive the market growth and forecasting of the market between 2023 and 2027
• Precise estimation of the size of the market size and its contribution to the parent market
• Accurate predictions about upcoming market trends and analysis and changes in consumer behavior
• Growth of the market industry across Europe, North America, APAC, South America, and Middle East and Africa
• Thorough market growth analysis of the market’s competitive landscape and detailed information about vendors
• Comprehensive market analysis and report on the factors that will challenge the market research and growth of market companies

We can help! Our analysts can customize this market research report to meet your requirements. 

Get in touch