Market Trends of Middle-East and Africa Portable Generator Industry
This section covers the major market trends shaping the MEA Portable Generator Market according to our research experts:
Diesel is Expected to Dominate the Market
- Diesel generators use diesel as a fuel to power the engine. Diesel generators are the most important, reliable, and least expensive equipment for power generation. These generators can serve as a primary power source, a reliable secondary power source, and a backup or standby power source for residential, industrial, and commercial customers across the Middle East & African region.
- Though diesel is costlier compared to gas, it has a higher energy density, and more energy can be extracted from the same amount of fuel. Diesel is also less flammable than gas and other fuels, making it safer to store and handle.
- Diesel generators are more economical compared to gas generator sets. Due to the ease of transportation and storage of diesel, easy on-site fuel availability has also made diesel generators more popular than gas generators.
- Diesel portable generators are primarily used as a standby power source by consumers. When there is a lack of power, diesel generators can provide adequate backup power. The residential sector is highly dependent on power supply from portable generators.
- The shortage of power supply results in downtime for business operations, which can be a significant loss. These portable generators can maintain a steady power supply and ensure smooth business operations. The diesel generators are beneficial in terms of cost-effectiveness, fuel availability, and running, making them the most sought-after choice as a standby power source.
- Oil consumption in the Middle East increased by 3.9% in 2021. In the same year, oil consumption was 8,640 thousand barrels per day compared to 2020, i.e., 8,318 thousand barrels per day. Oil consumption in Africa also increased by 8.7% in 2021.
- Due to such advantages, the demand for portable diesel generators is expected to be higher during the forecast period.
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Nigeria is Expected to Dominate the Market
- Nigeria is one of the biggest economies in Africa, with a GDP of approximately USD 440.78 billion recorded in 2021. However, the country's power sector is performing below the level of its neighboring countries. As of 2021, around 40% of the population had no access to grid-connected electricity, and those connected to the grid suffered extensive power outages.
- In 2021, the country had an installed capacity of 16,384 MW. Due to outdated infrastructure and frequent power grid failures, the national grid only provides 4,000 MW at peak, leaving businesses and citizens heavily reliant on diesel and petrol-powered generators.
- According to the Energy Commission of Nigeria, the country spends approximately USD 22 billion annually on fuel generators. According to the World Bank, more than 70% of Nigerian firms rely on generators for their electricity.
- According to Nigeria's Rural Electrification Agency (REA), Nigerians spend an estimated USD 14 billion annually on small-scale diesel generators due to the lack of reliable power from the national grid.
- The already critical energy situation in Nigeria has entered a state of desperation due to the disruptive economic effects of the Russia-Ukraine conflict, which led to an increase in energy prices globally.
- Thus, due to poor infrastructure and lower investment in grid development, the demand for portable generators is expected to rise in the country in the future.
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