Europe Thermal Power Market Trends

Statistics for the 2023 & 2024 Europe Thermal Power market trends, created by Mordor Intelligence™ Industry Reports. Europe Thermal Power trend report includes a market forecast to 2029 and historical overview. Get a sample of this industry trends analysis as a free report PDF download.

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Market Trends of Europe Thermal Power Industry

Natural Gas Based Thermal Power to Witness Significant Growth

  • Natural gas is one of the cleanest fuels that can affordably supply electricity on a large scale. In the future decades, gas-fired power generation will likely displace coal capacity in the region. Furthermore, investments in renewables are predicted to skyrocket, and the flexibility provided by gas-fired power generation is expected to remain in high demand.
  • Using natural gas thermal power plants as backup power for unreliable renewable sources such as wind and solar is one of the most significant factors driving their adoption. The ability of natural gas plants to initiate quickly makes them highly dependable, thus improving the reliability of the utility grid and promoting the market's expansion.
  • In February 2022, the government of Ireland announced that they plan to build nine new gas-fired power plants by 2024 to meet rising electricity demand and avoid a power shortfall on the island. The proposed additional plants in Westmeath, Galway, and Dublin will be built due to a recent capacity auction undertaken jointly by the grid operator Eirgrid and its Northern Ireland equivalent, SONI.
  • Moreover, Natural gas electricity generation is a significant part of the energy mix in Europe. In 2021 the total electricity generation through natural gas was recorded at 799.3 TWh, an increase of 4.7% compared to 2020. However, the natural gas supply was severely affected due to the Russia-Ukraine war. It is estimated to affect electricity generation through natural gas in Europe heavily.
  • With advantages like low emissions compared to coal and fewer harms compared to nuclear, the market share of natural gas in power generation is likely to grow.
Europe Thermal Power Market: Natural Gas Electricity Generation , in TWh, Europe, 2014-2021

Germany to Dominate the Market

  • Despite Germany's commitment to environmental goals, the country heavily relies on natural gas, particularly heating. However, the country also includes a significant capacity for natural gas-powered electricity production, which is anticipated to increase in the projected period. It is estimated that an additional 20-30 GW of gas-fired capacity will be necessary to satisfy domestic demand while meeting climate targets and transitioning away from coal and nuclear energy.
  • As of 2022, there are approximately 27.2 GW of gas-powered projects in the pipeline, with an additional 2.4 GW expected to be installed between 2021 and 2022. Several plants, including VW's Wolfsburg CCGTs (400 MW), Uniper's Scholven unit (135 MW), and Steag's Herne 6 (625 MW), are scheduled to come online in 2023.
  • Furthermore, according to BP's statistical review of world energy in 2021, the country's electricity generation through thermal energy sources increased by almost 9% between 2021 and 2020.
  • Moreover, the irregular natural gas supply severely affected Germany due to the Russia-Ukraine war. The government reactivated the existing coal power plant facility in the country.
  • For instance, in August 2022, the Heyden facility in Petershagen, near Hanover in northern Germany, was set to reopen on August 29 and remain operational until the end of April, according to operator Uniperannounced. Heyden, with a capacity of 875 MW, is one of Germany's most powerful coal-fired power stations.
  • Therefore, due to the abovementioned facts, Germany is expected to dominate the thermal power segment during the forecasted period.
Europe Thermal Power Market: Electricity Generation, By Thermal Energy Sources, in TWh, Germany, 2020-2021

Europe Thermal Power Market Size & Share Analysis - Growth Trends & Forecasts (2024 - 2029)