Combined Heat and Power (CHP) Installation Market to Reach US$812.80 bn by 2024; Industry to Surge Globally as Demand for Cost-effective and Renewable Energy Rises: TMR

Sep 14, 2016, 07:30 ET from Transparency Market Research

ALBANY, New York, September 14, 2016 /PRNewswire/ --

The upsurge in the consumption of fuel derived from biomass, wood, and waste heat, is likely to boost the installation of combined heat and power (CHP) across the globe. Transparency Market Research forecasts the global CHP installation market to exhibit a CAGR of 4.38% between 2014 and 2024. The prospects for CHP installations have improved globally in response to the rising energy prices. This, combined with stringent regulations implemented to curb carbon emissions from conventional systems, is expected to aid the proliferation of CHP systems worldwide.

CHP systems run on both renewable and non-renewable fuels such as natural gas, coal, wood, biomass, oil, and waste heat. They can operate at an efficiency level as high as 77% to 90% as compared to the 46% efficiency level of conventional systems. However, the best economics of a CHP system is achieved in cold climates, when the energy rates are high, prices of natural gas fall, and there is a continuous demand for heat. Besides this, diverse functionalities offered by CHP systems also encourage their installation in both colder and hotter regions.

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Strong Existing Network of CHPs to Boost their Installation Worldwide 

Based on in-depth research, TMR has pegged the combined heat and power installations worldwide to reach US$812.80 bn by 2024. The global CHP installation market stood at US$524.89 bn in 2014. The market will further gain impetus from the strong existing CHP network. The increasing awareness about CHP systems, particularly in developing nations is likely to translate into increased sales for the global CHP installation market. These countries are exhibiting high aggregate demand for energy-efficient technologies, thus creating enough opportunities for the market to leverage from during the report's forecast period.

The presence of a large number of companies offering diverse products and services related to combined heat and power (CHP) installations is fueling competition in the global CHP installation market. A CHP system is manufactured using numerous components such as turbines, filters, generators, engines, valves, and compressors. Several companies are therefore present in the market, selling key components, providing after-sales services, and distributing equipment.  

BDR Thermea Group B.V. held the largest share in the global CHP installation market in 2014, as per TMR analysis. Some of the most prominent enterprises operating in the market include 2G Energy AG, Siemens AG, Edina Ltd., Wärtsilä Corporation, ENER-G Holdings Plc (ENER-G), Clarke Energy Ltd., and others. The top eight companies hold 53% of the global combined heat and power installation market.

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The demand for CHP systems mainly arises for industrial applications, followed by commercial and residential applications. As the industrial segment accounts for the largest share in the market, it holds lesser scope for growth compared to the residential and commercial application segments. As per TMR, the U.S., Japan, and Germany are at the fore of adopting CHP systems for commercial and residential applications.

Strong Existing CHP Networks Facilitate CHP Installations Globally 

CHP systems sales worldwide are riding on the strong existing CHP network. Furthermore, the increasing awareness regarding the benefits of CHP systems will boost their installations across emerging economies of Asia Pacific. Since the last few years, these countries have been exhibiting high demand for energy-efficient technologies. Developing countries therefore offer attractive opportunities for the vendors operating in the market.

TMR forecasts the value chain of the global CHP installation market to remain highly complicated during the forecast period from 2014 to 2024. "The implementation of stringent emission control norms worldwide has compelled leading enterprises to adopt forward integration. Such strategies could have an adverse impact on the market's growth trajectory," said a TMR analyst. "Combined with this, the high cost incurred on installing CHP systems is also inhibiting the large-scale proliferation of CHP installations," he added. Nevertheless, increasing scope in the residential and commercial sector is expected to boost the prospects for the market in the near future.

Large-scale CHPs to Lose Market Share to Micro & Small CHPs in the Forecast Period 

By type, large-scale CHPs hold a dominant share of 85.69% in the global CHP installation market, followed by micro- and small scale CHPs in 2014. However, they are expected to lose a significant part of their market share to the latter in the near future. The rising usage of micro- and small-scale CHPs across residential and commercial sector will enable the segment to report the fastest CAGR during the forecast period. However, the increasing CHP installation in India and China will keep the demand for large-scale CHPs high in the forthcoming years.

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Easy Availability of Natural Gas Boosts Prospects for CHP Installations in Europe 

Regionally, Europe emerged as the largest market for CHP installations in 2014. The region accounted for a share of 67.96% in the overall market in 2014. The easy availability of natural gas in Russia, has significantly contributed to the increased demand for CHP installations in Europe. Other countries in Europe exhibiting increasing demand for CHP installations include Germany, Poland, Belgium, Italy, and the Netherlands. Leading companies operating in the market are also looking to explore untapped opportunities in the Asia Pacific market.

Driven by the increased demand across emerging economies, the global combined heat and power installation market is poised to surge at 4.38% CAGR. TMR pegs the market's valuation at US$524.89 bn in 2014. By the end of 2024, the market is expected to reach US$812.80 bn.

This review is based on the findings of a TMR report, titled "Combined Heat and Power (CHP) Installation Market - Global Industry Analysis, Size, Share, Growth Trends, and Forecast 2024."

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The report segments the global combined heat and power installation market at:

CHP Installation Market: By CHP Type 

  • Large-scale CHP
  • Micro & Small-scale CHP

CHP Installation Market: By CHP Application 

  • Residential
  • Commercial
  • Industrial

CHP Installation Market: By CHP Technology 

  • Combined Cycle
  • Steam Turbine
  • Combustion/Gas Turbine
  • Reciprocation Engine
  • Others (Microturbine, Fuel Cell, and Waste Heat Recovery)

CHP Installation Market: By Fuel 

  • Natural Gas
  • Coal
  • Biomass
  • Others (Wood, Waste Heat, and Oil)

CHP Installation Market: By Region 

North America 

  • U.S.
  • Canada
  • Mexico


  • Russia
  • Germany
  • France
  • U.K.
  • Italy
  • Spain
  • Netherlands
  • Poland
  • Rest of Europe

Asia Pacific 

  • China
  • Japan
  • India
  • South Korea
  • Taiwan
  • Rest of Asia Pacific

Rest of World 

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About TMR 

Transparency Market Research (TMR) is a global market intelligence company providing business information reports and services. The company's exclusive blend of quantitative forecasting and trend analysis provides forward-looking insight for thousands of decision makers. TMR's experienced team of analysts, researchers, and consultants use proprietary data sources and various tools and techniques to gather and analyze information.

TMR's data repository is continuously updated and revised by a team of research experts so that it always reflects the latest trends and information. With extensive research and analysis capabilities, Transparency Market Research employs rigorous primary and secondary research techniques to develop distinctive data sets and research material for business reports.

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