PUBLISHER: Stratistics Market Research Consulting | PRODUCT CODE: 1209830
PUBLISHER: Stratistics Market Research Consulting | PRODUCT CODE: 1209830
According to Stratistics MRC, the Global Geothermal Power Equipment Market is accounted for $25.09 billion in 2022 and is expected to reach $38.74 billion by 2028 growing at a CAGR of 7.51% during the forecast period. Geothermal energy is the energy that the earth's core releases. The energy can be used in place of fossil fuels if it is adequately harnessed. By drilling wells into the earth's crust, the energy may be used, and power can then be produced using the heat energy released. The earliest stages of installing a geothermal plant could take some time because they entail multiple studies and drilling operations to determine the well's capacity. But once the initial steps are through, there are many of advantages for the businesses building a geothermal facility. Benefits in the form of government assistance, tax breaks, subsidies, etc. would greatly increase the project's viability and give the corporation an almost limitless supply of fuel for power generation. But it would all depend on where the well was located.
According to the International Geothermal Association (IGA), there is ongoing and planned development of about 15,000 MW of power generation capacity. According to the Energy Information Administration (EIA), as of 2020, California has 91% of the country's steam-powered capacity, and 65% of binary-cycle capacity is found in Nevada.
Market Dynamics:
Driver:
Rise in investments in renewable energy generation
The power production industry is being encouraged to choose cleaner and more environmentally friendly energy sources by the expansion of environmental protection rules around the world. To lessen their reliance on conventional power, which uses fossil fuels, major economies around the world are developing renewable energy sources. The power generation market is anticipated to benefit from this. The increased investment in solar, wind, biomass, and geothermal energy is reducing the world's reliance on coal and other fossil fuels. A significant source of renewable energy is geothermal energy. Compared to traditional energy sources, it offers a number of benefits. Without burning fossil fuels, geothermal energy is drawn from the earth. There are no emissions from geothermal fields. Comparing geothermal energy to other renewable sources like solar, wind, and biomass, it also has a number of advantages. It is a very reliable source of energy that is available all year round and is not reliant on the sun or wind. As a result, geothermal energy is receiving major investment from most nations. The market for geothermal power equipment is consequently anticipated to grow.
Restraint:
Alternative renewables options
Although there are many household, commercial, and industrial applications for geothermal energy, the accessibility and availability are not on par. Regarding distribution, the energy is contained in particular places and is only available within a specified geographic area. Due to the significant financial needs from drilling through plant construction, geothermal energy is also regarded as one of the most comprehensive sources. Due to the low cost of production, other renewable energy sources including solar photovoltaics, onshore wind, and offshore wind power still have lower costs. Therefore, over the long term, other renewable sources are predicted to reduce the market share of geothermal energy.
Opportunity:
Rising government initiatives and policies regarding
Over the past few years, there has been a noticeable increase in the focus on lowering the world's reliance on coal and other fossil fuels. There are numerous new geothermal energy projects being developed. The majority of them are in various stages of development and will begin steadily adding to the world's energy mix in the next years. A number of nations, including the U.S., Japan, and nations in the European Union, have implemented significant energy regulations that are explicitly targeted towards geothermal facilities. These include capital subsidies, net metering, tax credits, and feed-in tariffs. The European Union's DG working group (Implementation Working Group for Deep Geothermal) is following the SET Plan's objectives of establishing Europe as a pioneer in the field of low-carbon energy. The Indonesian government intends to build 7200 MW worth of geothermal power plants and speed up the utilisation of geothermal energy under its National Energy Policy. The geothermal energy sector is anticipated to experience a significant increase during the projection period as a result of suggested incentives and specific renewable energy targets for a number of nations. In turn, this raises the demand for geothermal energy equipment.
Threat:
High cost association
Since installing geothermal power plants requires "equipment-intensive procedures," their construction and development costs are predicted to remain expensive in the years to come compared to other renewable sources like wind and solar. The building of a geothermal power plant requires a significant upfront investment, which is impeding market expansion in India. Deep-water resource prospecting and drilling are exceedingly expensive. Although the construction of geothermal power stations is highly expensive, the electricity they produce is less expensive and has a considerably lower impact on global warming and air pollution than natural gas generation. Although there is a little possibility of releasing gases like methane and compounds containing arsenic, typical geothermal plant emissions are negligible in comparison to those from fossil fuel plants.
COVID-19 Impact
Over the past few months, the majority of sectors in the world have experienced unfavourable effects. This can be ascribed to the enormous disruptions that various precautionary lockdowns and other limitations that were imposed by governing agencies around the world caused in their respective production and supply-chain operations. The same holds true for the market for geothermal power equipment globally. Additionally, consumer demand has now decreased as people have been more intent on cutting down non-essential expenses from their individual budgets as the general economic condition of the majority of people has been adversely impacted by this outbreak. Over the course of the forecast period, the aforementioned factors are anticipated to have a negative impact on the revenue trajectory of the global geothermal power equipment market. However, the global Geothermal Power Equipment market is anticipated to recover in line with this as respective governing bodies start to lift these enforced lockdowns.
The binary cycle power plants segment is expected to be the largest during the forecast period
The binary cycle power plants segment is estimated to have a lucrative growth, due to superior performance and lowest cost advantages over other geothermal varieties. In a binary cycle geothermal power plant, isobutene is heated by the water that is pumped from the geothermal reservoir through a heat exchanger. In the binary cycle, reservoirs of steam or water are never in direct contact with the turbines. Most geothermal regions on the planet have mild temperatures (below 400°F). The geothermal energy that can be extracted from moderate temperatures is best suited for binary cycle power plants. Therefore, compared to other geothermal types, the installed capacity of binary cycle geothermal facilities is significantly higher. The binary cycle will continue to dominate the geothermal power industry in the long run thanks to constant capacity increase.
The horticulture segment is expected to have the highest CAGR during the forecast period
The horticulture segment is anticipated to witness the fastest CAGR growth during the forecast period. Horticulture contributes to global warming by both consuming energy and emitting greenhouse gases. Different processes in agriculture can be powered by geothermal energy. One of the most potential uses for geothermal energy is horticulture, and Poland possesses the prerequisites for expanding geothermal use in this industry. Horticulture and associated industries are significant geothermal energy application areas. Even on a modest scale, geothermal energy for horticulture can greatly improve food and nutrition security, generate money, create jobs, and promote economic growth in impoverished nations.
Region with highest share:
Asia Pacific is projected to hold the largest market share during the forecast period owing to the region's developing economies' expanding manufacturing sectors, as well as its quickening industrialization and urbanisation. Additionally, the market for geothermal power equipment was driven by the growing importance of renewable energy. With a 330 MV installed capacity, the Sarulla geothermal power plant in Indonesia has begun operating, marking another significant step in the country's efforts to transition to a more renewable energy future. The largest single-contract geothermal power plant in the world will use this project to power approximately million Indonesian homes.
Region with highest CAGR:
North America is projected to have the highest CAGR over the forecast period, owing to the most installed geothermal power producing capacity was found in the American states of California, Nevada, Utah, Alaska, and Hawaii. California currently has 43 geothermal power facilities operating with a combined total capacity of 2,730 MW. California has more renewable energy plants installed than any other U.S. state, and there are 22,250 MW of utility-scale systems operating there. According to the University of Michigan, the amount of electricity produced by geothermal power plants in the United States is expected to rise from 15.98 billion kWh in 2017 to 29.55 billion kWh.
Key players in the market
Some of the key players profiled in the Geothermal Power Equipment Market include Fuji Electric Co. Ltd, Loki Geothermal, Ormat Technologies Inc., Mitsubishi Heavy Industries, Ltd, General Electric, Ergil, Chevron Corporation, Toshiba Corporation, Boreal Geothermal, Ansaldo Energia S.p.A, Turboden S.p.A, TAS Energy Inc., Alstom, Holtec International, Edge Energy Ltd, Energy Venture Partners, Gulf Coast Green Energy and Dominica Geothermal Development Company.
Key Developments:
In June 2022, Dominica Geothermal Development Company announced the development of a geothermal project in the village of Laudat in Roseau Valley, Dominica with a planned capacity of 10 MW. Construction of the power plant is planned to start within a year and is expected to complete in 18 months.
In May 2021, Ormat Technologies, Inc. announced an agreement with TG Geothermal Portfolio, LLC to acquire two contracted geothermal assets in Nevada with a total net generating capacity of 67.5 MW (net), a greenfield development asset adjacent to one of the plants, and an underutilized transmission-line.
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