Combined Heat and Power Market May Reach to $39.2 billion by 2029 at a CAGR of 5.2%, says MarketsandMarkets™


Chicago, July 11, 2024 (GLOBE NEWSWIRE) — The Combined Heat and Power Market is projected to reach USD 39.2 billion by 2029 from an estimated USD 30.4 billion in 2024, at a CAGR of 5.2% during the forecast period.

The market for Combined heat and power is propelled by factors such as increased demand for energy efficiency and environmental regulations, energy security, cost savings, and technological advancements. They offer advantages such as improved reliability, enhanced energy independence, and reduced environmental impact, further driving market growth.

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Scope of the Report

List of Key Players in Combined Heat and Power Market:

  • GE (US),
  • Siemens Energy (Germany),
  • Veolia (France),
  • Wärtsilä (Finland),
  • 2G Energy (Germany) among other

Drivers, Opportunities and Challenges in Combined Heat and Power Market:

  1. Driver: Government programs and incentives to promote CHP
  2. Restraint: Rising concerns over stable natural gas supply for CHP systems
  3. Opportunity: Increased trend of distributed power generation creates huge opportunity for gas turbine-based CHP market.
  4. Challenge: Challenges posed by utilities for sale of excess electricity by CHP plants

This report segments the Combined Heat and Power Market based on prime mover into six types: gas turbine, steam turbine, reciprocating engine, fuel cell, microturbine and others. The reciprocating engine segment is expected to be the largest segment during the forecast period. The reciprocating engine segment is growing due to increasing demand for distributed power generation, reciprocating engines, primarily gas-powered, are widely utilized in CHP solutions offered by companies like Wartsila, Clarke Energy, and 2G Energy. Their flexibility, ranging from 10 kW to 10 MW, and compatibility with natural gas contribute to their growing popularity in the market.

This report segments the Combined Heat and Power Market based on capacity into four segments: upto 10 MW, 10-150 MW, 150-300 MW, and above 300 MW. The upto 10 MW segment is anticipated to have the largest growth rate during the forecast period due to various factors, this segment is experiencing growth in combined heat and power (CHP) plants. Demand for diesel power engines arises from utility-scale plants, industrial facilities, and independent power producers (IPPs). Gas and steam turbine-based CHP plants are favored for applications like solar thermal and geothermal plants, while energy-intensive industries install on-site CHP plants for power, heat, and steam needs, driving market expansion.

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The Combined Heat and Power Market is experiencing robust growth in the Combined Heat and Power Market is fueled by government programs and incentives to promote CHP, rise in use of natural gas for power generation and significant benefits of CHP systems in wastewater treatment facilities. Advancements such as higher efficiency gas turbines, improved heat recovery systems, and integration with renewable energy sources contribute to expanding the capabilities and appeal of CHP systems.

Asia Pacific is expected to be the fastest growing region in the Combined Heat and Power Market between 2024–2029, followed by Europe. The CHP market is poised for growth in countries like China and India, fueled by infrastructure expansions, ongoing power projects, and technological advancements. For instance, the Zhaoqing Dinghu CHP project will leverage Siemens Energy’s advanced gas turbine technology. Investment in large new gas-fired cogeneration and coal-fired plants, coupled with increasing electricity demand, is expected to propel the Asia Pacific CHP market in the next five years. With China and India leading in power generation and energy consumption, the region’s rapid economic growth and transition from coal to gas-fired generation offer significant potential for CHP adoption

Recent Developments

  • In March 2023, Siemens Energy partnered with customers to tackle ships’ environmental impact by introducing methanol fuel cell systems for onboard electricity generation. Developed in collaboration with fuel cell supplier Advent Technologies Holdings, Inc., the technology is now available, offering a tailored net-zero greenhouse gas emission solution for the marine sector in less than two years.
  • In August 2023, 2G Energy expanded its core cogeneration business by acquiring Dutch heat pump manufacturer NRGTEQ, adding an innovative division to its portfolio. This move aligns with the growing political emphasis on electrifying the heating sector, showcasing 2G Energy’s commitment to diverse and sustainable energy solutions.
  • In February 2024, Mitsubishi Heavy Industries invests in Feryo Energy, a Houston-based geothermal technology startup. The investment, facilitated by Mitsubishi Heavy Industries America, includes collaboration with a consortium of investors like Devon Energy Corporation and Marunouchi Innovation Partners.
  • In May 2020, Wärtsilä and Uniper supplied a 105 MW combined heat and power (CHP) gas engine plant to Bremen, Germany, commissioned by Erzeugung GmbH & Company KG. The project involved the delivery of nine Wärtsilä 31SG gas engines along with the heat recovery system.

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