City Gas Distribution Market Size

City Gas Distribution Market Analysis

The global city gas distribution market is expected to grow at a CAGR of around  3.2%, during the forecast period. Growing urbanization across the globe, leads to the demand of natural gas in various sectors like industry, power, residential and commercial buildings, and transportation. During 2018, it has been estimated that nearly 82% of all gas consumed globally was in urban areas. Natural gas plays a significant role in energy generation for cities. With a lesser amount of greenhouse gas emissions than coal or oil (approximately 40% and 20%, respectively), it helps to maintain and to stabilize the carbon footprint around the world. Through city gas distribution pipeline network, one can have easy access to cleaner fuel like natural gas. The drivers for the market are the government initiatives to have access to cleaner energy, and thereby to reduce air pollution. As per World Health Organization (WHO), more than 80% of the people around the globe are exposed to the growing air pollution resulting in nearly seven million deaths per year. Inline initiatives to Paris Agreement such as C40 and the Global Covenant of Mayors for Climate Change are the prominent initiatives, with cleaner environment objective. However, the growing developments in renewable energy sector such as solar and wind is expected to act as a restraint for the market to grow during the forecasting period.

• In 2018, power sector is the largest end-use sector for natural gas or city gas consumption, accounting for nearly 39% of global natural gas consumption. Power generation through gas-fired power plants has a significant market share. Natural gas, as a relatively clean fuel than coal in getting preference for power generation in several nations of the world. During 2018, electricity generation from natural gas has taken a y-o-y growth of around 4%.
• The rate of urbanization primarily drives the consumption of city gas. With the properties of emitting low carbon particles than coal and oil, city gas has a tremendous potential to reduce the growing carbon emission. It has been estimated that during the year 2018, nearly 76% of the coal and 63% of the oil consumed around the world is from the urban area. Moreover, it is estimated that the share of the urban population has increased from 30% in 1950 to nearly 55% in 2018, and by 2050, it is expected to reach 66%. Thus, the rapid growth in urbanization especially in the developing economies is expected to create an opportunity for the city gas distribution market in the near future.
• The Asia-Pacific is expected to dominate the city gas distribution market with a higher demand for natural gas in the region during the forecasting period. With rising urbanization, the demand for natural gas is expected to exceed 20% of global natural gas demand.