The global microgrid market is expected to grow at a CAGR of more than 13% over the period of 2020-2025. Factors such as increasing demand for reliable and continuous power supply worldwide, to reduce the over-dependence on power grids and preventing power blackouts during natural calamities, microgrids are being installed in greater numbers, which is driving the market. Moreover, renewable power is increasingly being used to provide electricity to remote locations, by connecting to remote power systems microgrid, which is economically efficient in comparison to large power plants. However, the reluctance shown by several industries that still prefer conventional electricity over microgrids owing to a better return on investment is restraining the market growth.
- The commercial and industrial facilities are more sensitive to power outages than other sectors, and a short period of an outage can lead to substantial losses. C&I sector is increasingly moving toward locally built independent power sources that can be distributed by microgrid network.
- Rising electrification projects in Asia-Pacific and Africa, such as Western Africa Regional Off-grid Electrification Project and other remote locations, presents an opportunity for the microgrid market players.
- Asia-Pacific is expected to be the fastest-growing region and presents the largest opportunity for the microgrid market during the forecast period, attributed to increasing investments made by both national as well as international companies.
Key Market Trends
Commercial and Industrial Sector to Dominate the Market
- In many developing countries, the power sector suffers untimely power outages, owing to the insufficient power supply, and poor transmission and distribution network that require frequent maintenance.
- Therefore, C&I sector is increasingly moving toward locally built independent power sources that can be distributed by the microgrid network rather than being dependent on electricity supply through the national grid.
- The integration of microgrids with the wholesale power market is a big boost for the development of microgrid networks in Europe. The widespread network of the microgrid can be integrated with the power network, and the owners of the microgrid can execute the trading activities.
- Renewable energy sources, such as solar energy, are witnessing substantial growth in the C&I sector, particularly in developed countries, owing to their minimal impact on the environment.
- Therefore, the declining cost of renewable, combined with technological advancements in energy storage systems customized commercial sector, is expected to help support the growth of the market.
Asia-Pacific to Dominate the Market
- Asia-Pacific has been experiencing increased demand for microgrids, majorly owing to factors, such as increased rural electrification programs in developing countries and the development of commercial microgrids in advanced nations.
- The number of projects and overall power capacity of Asia-Pacific is almost at par with North America and is expected to overtake it during the forecast period.
- As part of Japan’s policies to boost energy efficiency and power generation from renewable sources, the country’s sustained efforts toward smart grid deployment is expected to supplement the microgrid market in the Asia-Pacific region. To increase resiliency against natural disasters, Japanese cities are moving away from large-scale power toward microgrids.
- In September 2017, PanaHome Corporation, ENERES Co. Ltd, IBJ Leasing Co. Ltd., and the Public Enterprises Agency of the Hyogo Prefectural Government announced the launch of the microgrid system powering 117 homes in Japan, hence driving the market in the region.
- Furthermore, government policies, such as Feed-in-Tariffs, are expected to supplement the growth during the forecast period further.
The microgrid market is consolidated. Some of the key players in this market are ABB Ltd, Siemens AG, Honeywell International Inc., Schneider Electric SE, Toshiba Corporation and General Electric Company, among others.
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1.1 Scope of the Study
1.2 Market Definition
1.3 Study Assumptions
2 RESEARCH METHODOLOGY
3 EXECUTIVE SUMMARY
4 MARKET OVERVIEW
4.2 Market Size and Demand Forecast in USD billion, till 2025
4.3 Recent Trends and Developments
4.4 Government Policies and Regulations
4.5 Market Dynamics
4.6 Supply Chain Analysis
4.7 Porter's Five Forces Analysis
4.7.1 Bargaining Power of Suppliers
4.7.2 Bargaining Power of Consumers
4.7.3 Threat of New Entrants
4.7.4 Threat of Substitutes Products and Services
4.7.5 Intensity of Competitive Rivalry
5 MARKET SEGMENTATION
5.1.1 Institutional Sites
5.1.2 Commercial Facilities
5.1.3 Remote Off-grid Communities
5.1.4 Other Applications
5.2.1 Customer Microgrid
5.2.2 Remote Power Systems
5.2.3 Other Types
5.3.1 North America
5.3.4 South America
5.3.5 Middle-East and Africa
6 COMPETITIVE LANDSCAPE
6.1 Mergers and Acquisitions, Joint Ventures, Collaborations, and Agreements
6.2 Strategies Adopted by Leading Players
6.3 Company Profiles
6.3.1 ABB Ltd
6.3.2 Siemens AG
6.3.3 Honeywell International Inc.
6.3.4 Schneider Electric SE
6.3.5 Toshiba Corp.
6.3.6 General Electric Company
6.3.7 Eaton Corporation PLC
6.3.8 Standard Microgrid Inc.
6.3.9 Princeton Power Systems Inc.
6.3.10 S&C Electric Co.
7 MARKET OPPORTUNITIES AND FUTURE TRENDS
Secondary Research Information is collected from a number of publicly available as well as paid databases. Public sources involve publications by different associations and governments, annual reports and statements of companies, white papers and research publications by recognized industry experts and renowned academia etc. Paid data sources include third party authentic industry databases.
Once data collection is done through secondary research, primary interviews are conducted with different stakeholders across the value chain like manufacturers, distributors, ingredient/input suppliers, end customers and other key opinion leaders of the industry. Primary research is used both to validate the data points obtained from secondary research and to fill in the data gaps after secondary research.
The market engineering phase involves analyzing the data collected, market breakdown and forecasting. Macroeconomic indicators and bottom-up and top-down approaches are used to arrive at a complete set of data points that give way to valuable qualitative and quantitative insights. Each data point is verified by the process of data triangulation to validate the numbers and arrive at close estimates.
The market engineered data is verified and validated by a number of experts, both in-house and external.
REPORT WRITING/ PRESENTATION
After the data is curated by the mentioned highly sophisticated process, the analysts begin to write the report. Garnering insights from data and forecasts, insights are drawn to visualize the entire ecosystem in a single report.