Market Trends of Europe Diesel Generator Industry
Industrial Sector to Dominate the Market
- The industrial sector, which includes mining, manufacturing, agriculture, and construction, uses more than half of the energy that will be used over the next few years.
- The largest amount of energy is used by the industrial sector, which includes mining, manufacturing, agriculture, and construction.Because of this, the demand for diesel generators is likely to go up as these industries, especially healthcare, pharmaceutical, and manufacturing facilities, need more and more power that is always on and reliable.
- Therefore, the increasing demand for continuous and reliable power supply in industries like pharmaceuticals and manufacturing facilities is expected to escalate the demand for diesel generators. Industrial operations mainly depend on electricity generated from diesel generators during power outages (to avoid operation downtime) and in regions with limited grid access.
- As of 2021, Europe was the second-largest producer of steel in the world after China. In 2021, its output was over 308.5 million metric tons of steel annually, accounting for 16.3% of global output and mostly coming from Germany at 40.1 metric tons. The steel industry is a major consumer of power and requires a large amount of reliable energy for steel manufacturing. Many countries like Germany still use diesel generators for the steel industry, which act as the backbone for the country's development work.
- In the next few years, both the UK and Russia are likely to see growth in their industrial sectors. This is because the manufacturing sectors in both countries are growing quickly, which is likely to increase the demand for diesel generators in the industrial sector.
- Furthermore, government initiatives to expand the industrial sector, especially in the United Kingdom and Turkey, are expected to propel the demand for diesel generators over the forecast period.
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The United Kingdom to Dominate the Market
- The United Kingdom is one of the most developed countries in the world. It is also one of the most industrialized countries in the European region, with an ever-increasing demand for energy. With increasing demand for energy, there is also an increasing need for uninterrupted power supply among various sectors of the economy.
- The United Kingdom's national grid requires a backup power source that can be used when there is a peak demand. The National Grid Electricity Transmission (NGET) has been using diesel generators (DG) sets to accommodate this peak demand and provide backup power to substations for key activities such as cooling fans, pumps, and lighting, enabling it to continue to perform its crucial role in the electricity transmission system.
- Backup generators are used at over 250 NGET sites across England and Wales, the majority of which are diesel-powered. These systems provide NGET with the resilience to recover from a loss of power supply event.
- The country benefits from the cost and effectiveness of diesel generators, with improved living standards increasing the demand for power backup devices. There are various sectors, such as agriculture, telecommunication, construction, etc., within the United Kingdom that have generators being utilized on a regular basis.
- The construction activity around the country has been increasing in the past few months. The construction output increased by 1.1% in volume terms in January 2022 and is at its highest level since September 2019; this followed an increase of 2.0% in December 2021 and was the third consecutive month of growth greater than 1.0%.
- The United Kingdom's agriculture sector is large and covers more than 60% of the country's total land area. Although the country's power grid is increasingly dependent on renewable sources, the agriculture industry is more interested in the power backup system. It is becoming more dependent on diesel generator systems, which is driving the market.
- Around 40 to 50% of the data centers in Europe are present in the United Kingdom and consume a significant amount of power. The data center uses a diesel generator to meet electricity demand during a power cut.
- The country is expected to witness more data centers in the coming years, increasing the demand for the diesel generator.
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