The global generator set market will be US$41 billion by 2018, but diesel is facing fierce competition from natural gas gensets, according to a report by Navigant Research, a market research and analysis consultancy firm.
The report warns that diesel’s grip on the market is waning. “Although providers of diesel gensets can expect to see continued growth over the next several years, they face rising competition from natural gas gensets,” said Dexter Gauntlett, Navigant research analyst.
“Over the next decade, the increase in unconventional gas resources and tightening emissions regulations for stationary generators will favour clean-burning natural gas systems over their diesel counterparts in North America,” he added.
The report states that diesel gensets remain “one of the least expensive, most reliable technologies available today” for commercial facilities like hospitals and data centres that require “mission-critical power in the event of a grid outage”.
Navigant says that in the short term, countries with strong economic and/or population growth rates that also increasingly suffer blackouts – such as Nigeria, India, Chile and South Africa – will continue to drive diesel genset sales.
The report picks out India as an example of a country where industries have become highly dependent on diesel due to power outages spanning as much as 16 hours per day, making them more vulnerable to price volatility.