PUBLISHER: The Business Research Company | PRODUCT CODE: 1648725
PUBLISHER: The Business Research Company | PRODUCT CODE: 1648725
Distributed generation refers to a set of activities conducted for the development and sales of small generated energy used to provide electricity during power outages, including those that occur after severe storms and during high energy demand days.
The main technologies involved in distributed generation market are fuel cells, micro-turbines, wind turbines, combustion turbines, micro-hydropower, reciprocating engines, solar PV, and other technologies. A fuel cell is an electrochemical cell that uses the chemical energy of hydrogen or other fuels to cleanly and efficiently produce electricity. The applications of distributed generation include on-grid and off-grid. The various end-users of distributed generation include commercial, industrial, and residential.
The distributed generation market research report is one of a series of new reports from The Business Research Company that provides distributed generation market statistics, including distributed generation industry global market size, regional shares, competitors with a distributed generation market share, detailed distributed generation market segments, market trends and opportunities, and any further data you may need to thrive in the distributed generation industry. This distributed generation market research report delivers a complete perspective of everything you need, with an in-depth analysis of the current and future scenarios of the industry.
The distributed generation market size has grown rapidly in recent years. It will grow from $106.86 billion in 2024 to $120.73 billion in 2025 at a compound annual growth rate (CAGR) of 13.0%. The growth in the historic period can be attributed to energy independence, environmental concerns, government incentives, grid resilience.
The distributed generation market size is expected to see rapid growth in the next few years. It will grow to $198.45 billion in 2029 at a compound annual growth rate (CAGR) of 13.2%. The growth in the forecast period can be attributed to decentralization trend, renewable energy integration, energy storage advances, electric vehicles (EVs). Major trends in the forecast period include digitalization and IoT, technological advancements, rise of microgrids, hybrid systems integration, edge computing and ai, energy as a service (EaaS), flexibility and scalability.
The increasing electricity consumption is expected to drive the growth of the distributed generation market in the coming years. Electricity consumption refers to the total electrical energy used over a certain period, often measured in watt-hours (Wh) or kilowatt-hours (kWh). Distributed generation involves producing electricity closer to where it is used, utilizing various technologies to generate power on-site. As electricity consumption rises, the demand for distributed generation solutions grows to meet the need for more efficient and localized energy production. For instance, according to the U.S. Energy Information Administration, in 2022, total U.S. electricity end-use consumption grew by approximately 3.2% compared to 2021, with a 2.6% increase in the residential sector and a 4.7% rise in the commercial sector. This increase in electricity consumption is expected to further boost demand for distributed generation systems during the forecast period.
The increasing adoption of electric vehicles is expected to propel the growth of the distributed generation market going forward. An electric vehicle is a type of automobile that is powered by electricity, typically through one or more electric motors, rather than an internal combustion engine that relies on gasoline or diesel fuel. Distributed generation plays an important role in the integration of electric vehicles (EVs) into power distribution systems. It expands EV charging accessibility and alleviates grid congestion by enabling charging at multiple locations. For instance, in October 2023, according to the European Environment Agency, a Denmark-based government agency, the number of battery electric cars registered in Europe reached 1,126,682 in 2022, which is a 28. 35% increase compared to the 878,092 cars registered in 2021. Moreover, non-plug-in hybrid electric cars represented 19% of new registrations in 2021, up by 7% from 2020. Therefore, the increasing adoption of electric vehicles is driving the growth of the distributed generation market.
Technological advancements are the key trend gaining popularity in the distributed generation market. Companies operating in the distributed generation market are developing advanced products to strengthen their position in the market. For instance, in May 2022, Delta India, a subsidiary of Delta Electronics Inc., a Taiwanese-based company operating in distributed generation developed a medium-voltage QPR product named 11kV 3-phase Power Quality Restorer to resolve issues related to a plethora of power quality problems such as voltage fluctuations, flickers, equipment failures, and others with the higher efficiency. Additionally, 11Kv3-Phase QPR is capable of providing current harmonic compensation in both leading and lagging reactive power, correcting power load imbalance, regulating voltage, and reducing electric bills in an organization by avoiding power factor penalties and harmonic surcharges.
Major companies operating in the distributed generation market are increasing their focus on introducing hybrid distributed generation systems to gain a competitive edge in the market. Hybrid distributed generation systems are energy systems that combine multiple sources and technologies for power generation, such as renewable energy sources such as solar and wind, along with conventional sources such as diesel or natural gas generators, to provide reliable and efficient electricity supply in distributed or off-grid locations. For instance, in October 2023, Soleolico, a Spain-based energy company, launched a distributed-generation wind PV system that combines ultra-light solar panels from Spanish manufacturer Izpitek with wind turbines that follow the wind hybrid system. This system is designed to provide a revolutionary power solution, offering the benefits of both solar and wind system generation. This innovative system can be deployed in various settings, including residential, commercial, and industrial applications, contributing to the growth of distributed generation in Spain and beyond.
In July 2023, ArcLight Capital Partners, a US-based private equity company, acquired the commercial distributed generation business from Duke Energy Corporation for $364 million. The acquisition is expected to help ArcLight Capital Partners LLC strengthen its renewable energy portfolio and position the company for growth in the distributed generation market. Duke Energy Corporation is a US-based energy company that specializes in providing safe, reliable electricity and natural gas.
Major companies operating in the distributed generation market include Siemens AG, General Electric Company, Schneider Electric SE, Mitsubishi Heavy Industries Ltd., Caterpillar Energy Solutions GmbH, ASEA Brown Boveri Ltd., AES Corporation, Ameresco Inc., Ansaldo Energia S. p. A., Ballard Power Systems Inc., Bloom Energy Corporation, Capstone Turbine Corporation, Ceres Power Holdings plc, Clearway Energy Inc., Cummins Inc., Doosan Fuel Cell America Inc., E. ON SE, Enel Green Power S. p. A., FuelCell Energy Inc., Hitachi Ltd., Hydrogenics Corporation, Iberdrola S. A., Invenergy LLC, Johnson Controls International plc, SMA Solar Technology AG, SolarEdge Technologies Inc., Sonnen GmbH, SunPower Corporation, Tesla Inc., Linde plc, Toshiba Corporation, TotalEnergies SE
Asia-Pacific was the largest region in the distributed generation market in 2024. North America is expected to be the fastest-growing region in the distributed generation market share during the forecast period. The regions covered in the distributed generation market report are Asia-Pacific, Western Europe, Eastern Europe, North America, South America, Middle East, Africa
The countries covered in the distributed generation market report are Australia, Brazil, China, France, Germany, India, Indonesia, Japan, Russia, South Korea, UK, USA, Italy, Canada, Spain.
The distributed generation market includes revenues earned by entities by providing services with the aid of a two-wire DC connection of the distribution system, two-wire AC connection to the distribution system, three-wire DC connection to the distribution system, three-wire (delta) AC connection of the distribution system, four-wire (star) AC connection of distribution system. The market value includes the value of related goods sold by the service provider or included within the service offering. Only goods and services traded between entities or sold to end consumers are included.
The market value is defined as the revenues that enterprises gain from the sale of goods and/or services within the specified market and geography through sales, grants, or donations in terms of the currency (in USD, unless otherwise specified).
The revenues for a specified geography are consumption values that are revenues generated by organizations in the specified geography within the market, irrespective of where they are produced. It does not include revenues from resales along the supply chain, either further along the supply chain or as part of other products.
Distributed Generation Global Market Report 2025 from The Business Research Company provides strategists, marketers and senior management with the critical information they need to assess the market.
This report focuses on distributed generation market which is experiencing strong growth. The report gives a guide to the trends which will be shaping the market over the next ten years and beyond.
Where is the largest and fastest growing market for distributed generation ? How does the market relate to the overall economy, demography and other similar markets? What forces will shape the market going forward? The distributed generation market global report from the Business Research Company answers all these questions and many more.
The report covers market characteristics, size and growth, segmentation, regional and country breakdowns, competitive landscape, market shares, trends and strategies for this market. It traces the market's historic and forecast market growth by geography.
The forecasts are made after considering the major factors currently impacting the market. These include the Russia-Ukraine war, rising inflation, higher interest rates, and the legacy of the COVID-19 pandemic.