Combined Heat and Power (CHP) in UK Market Size & Share Analysis - Growth Trends & Forecasts (2024 - 2029)

The Market Report Covers UK CHP Manufacturers and is Segmented by End User (Industrial Sector, Commercial, and Transportation Sector, and Other End Users (Agriculture, Community Heating, Leisure, etc.)) and Types (Gas Turbine, Steam Turbine, and Other Types (Reciprocating Engine and Organic Rankine Cycle CHP)). The market size and forecasts are provided in terms of revenue (USD) for all the above segments.

UK Combined Heat and Power (CHP) Market Size

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UK Combined Heat And Power (CHP) Market Summary
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Study Period 2020 - 2029
Base Year For Estimation 2023
Forecast Data Period 2024 - 2029
Market Size (2024) USD 74.08 Million
Market Size (2029) USD 99.74 Million
CAGR (2024 - 2029) 6.13 %

Major Players

UK Combined Heat And Power (CHP) Market Major Players

*Disclaimer: Major Players sorted in no particular order

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UK Combined Heat and Power (CHP) Market Analysis

The UK Combined Heat And Power Market size is estimated at USD 74.08 million in 2024, and is expected to reach USD 99.74 million by 2029, growing at a CAGR of 6.13% during the forecast period (2024-2029).

The market was negatively impacted by COVID-19 in 2020. Presently the market has now reached pre-pandemic levels.

  • Over the medium term, growing emphasis on energy-efficient technology that generates electricity and increasing investments in CHP-based power projects are also expected to drive the growth of the market studied.
  • On the other hand, geopolitical tensions and increasing natural gas prices are expected to impose challenges on the combined heat and power market in the United Kingdom and may negatively impact the market's growth and are one of the major restraints for the market.
  • Nevertheless, increasing demand for distributed power generation and space heating coupled with technological advancements are expected to drive and create significant amount of opportunities for the market players.

UK Combined Heat and Power (CHP) Market Trends

Commercial and Transportation Segment is Expected to have as Significant Share in the Market

  • In the commercial end-user segment, the Combined Heat, and Power (CHP) systems are typically installed at hotels, supermarkets, office buildings, sports centers, hospitals, data centers, and shopping centers, providing energy independence and security. As these systems are relatively larger, and noise is a lesser concern, commercial systems are primarily internal combustion engine CHPs with higher electrical efficiency. However, with falling costs and the rising efficiency of fuel cell technology, fuel cell-based CHP systems are also becoming increasingly adopted by commercial end-users.
  • The hydrogen-based fuel cell (CHP) technology is an area of the automotive industry that is becoming increasingly essential as manufacturers commit to developing this type of power train. Like electric cars, hydrogen-powered fuel cell electric vehicles (FCEVs) are classed as ultra-low emission vehicles (ULEVs) since water vapor is the only substance that comes from the exhaust.
  • The commercial end-user segment in the United Kingdom is expected to witness a notable adoption of CHP systems due to the developments and the rising applications in commercial buildings, offices, hotels, hospitals, etc., during the forecast period.
  • Supermarkets are one of the major end-users of commercial CHP systems, which most of the total energy consumption in supermarkets is from refrigeration, lighting, and HVAC systems, with refrigeration responsible for nearly 1/3rd of the total energy consumption. As the energy requirement in the retail sector is significantly lower during non-operational hours and subject to seasonal variations, commercial CHP systems need to be sized accordingly to match demand spikes. In supermarkets, CHP systems (usually based on ICEs) are installed directly in loco, which could cover both electricity and heat loads, or at least a part of them.
  • The construction activity around the country has also been increasing in recent times. According to the Office of National Statistics, the total value of of new orders for construction in the private commercial sector increased to about USD 17,960 million in 2022, an increase of around 35% compared to 2020. These are likely to surge the growth of CHP systems in the country during the forecast period.
  • Therefore, owing to the above-mentioned points, commercial and transportation segment is expected to have a significant share in the United Kingdom's combined heat and power (CHP) market during the forecast period.
UK Combined Heat And Power (CHP) Market: United Kingdom Combined Heat and Power (CHP) Market: New Orders for Construction, in GBP Million, Private Commercial Sector, United Kingdom, 2013-2022

Increasing Natural Gas Price is Expected to Restrain the Market Demand

  • Natural Gas is one of the essential sources of energy, and the utilization of natural gas in gas engines is characterized by the lowest carbon dioxide emissions levels of all fossil fuels, which is in line with the United Kingdom's goal to reduce greenhouse gas emissions. In addition, according to the United Kingdom's Department for Business, Energy, and Industrial Strategy, using natural gas as a fuel for Combined Heat and Power (CHP) units reduce nitrogen oxide emissions and virtually contains no sulfur or contaminants.
  • Factors such as circumstances, such as soaring demand for natural gas in Asia and South America, diminished gas supply from Russia to the European markets due to the invasion of Russia on Ukraine, low gas stocks, and a series of breakdowns at various electrical facilities, consumers in the United Kingdom faced a significant increase in gas prices. Consumers, utility companies, and businesses using CHP units dependent on natural gas are impacted.
  • The primary cause of the natural gas price rise has been a surge in the wholesale price of natural gas globally. Domestic supply covers approximately 40% of the United Kingdom's needs. At the same time, the rest is imported from neighboring countries, such as Norway and the Netherlands. Further, afield in Qatar and the United States, and Russia supplies around 5% of the United Kingdom market.
  • According to Digest of UK Energy Statistics (DUKES), the United Kingdom had around 2,016 CHP sites in 2021, witnessing a decrease of 236 combined heat and power (CHP) areas compared to 2020.
  • Moreover, In February 2022, Russia's invasion of Ukraine in a horrific escalation of a war that started in February 2022 further spiked the natural gas prices. In March 2022, the Natural Gas spot prices in the United Kingdom were 511 pence/therm witnessing an increase of 139% as compared to the previous year. Further, according to Office for National Statistics (UK), in 2022, the average consumer price index for gas in the United Kingdom stood at 164.7 index points.
  • Thus, owing to the above points, increasing natural gas prices will likely hamper the combined heat and power (CHP) market in the United Kingdom during the forecast period.
UK Combined Heat And Power (CHP) Market: United Kingdom Combined Heat and Power (CHP) Market: Annual Natural Gas Consumer Price Index, in Numbers, United Kingdom, 2011-2022

UK Combined Heat and Power (CHP) Industry Overview

The UK combined heat and power (CHP) market is semi-consolidated. The key players in the market (in no particular order) include General Electric Company, Seimens Energy AG, Ramboll Group, Centrica PLC, and Caterpillar Inc., among others.

UK Combined Heat and Power (CHP) Market Leaders

  1. General Electric Company

  2. Caterpillar Inc.

  3. Siemens Energy AG

  4. Ramboll Group

  5. Centrica PLC

*Disclaimer: Major Players sorted in no particular order

UK Combined Heat And Power (CHP) Market Concentration
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UK Combined Heat and Power (CHP) Market News

  • In May 2023, DS Smith officially unveiled the new Kemsley CHP plant with E.ON. The company has joined hands with energy provider E.ON to launch a combined heat and power (CHP) plant at DS Smith's paper mill in Kent.
  • In May 2023, Centrica partner 2G Energy decided to introduce its 100% hydrogen-powered combined heat and power (CHP) engine at the UK's first 'Road to Net Zero Tour.' This is one of several promising projects the UK's energy firm thinks will pave the way for low-carbon hydrogen to replace fossil fuels in a large portion of the energy mix.
  • In March 2022, MPC Energy Solutions announced that it had completed the acquisition of the Neol CHP plant in Caguas, Puerto Rico, and the United Kingdom. The plant has a capacity of 3.4 MW, and the energy production is expected to be around 26,000 MWh per year. Furthermore, the company has a long-term power purchase agreement to supply electricity from the plant to Neolpharma Inc., a pharmaceutical company.

UK Combined Heat and Power (CHP) Market Report - Table of Contents

  1. 1. INTRODUCTION

    1. 1.1 Scope of the Study

    2. 1.2 Market Definition

    3. 1.3 Study Assumptions

  2. 2. EXECUTIVE SUMMARY

  3. 3. RESEARCH METHODOLOGY

  4. 4. MARKET OVERVIEW

    1. 4.1 Introduction

    2. 4.2 Market Size and Demand Forecast in USD, till 2028

    3. 4.3 Recent Trends and Developments

    4. 4.4 Government Policies and Regulations

    5. 4.5 Market Dynamics

      1. 4.5.1 Drivers

        1. 4.5.1.1 Increasing Investments in the CHP-Based Power Projects

        2. 4.5.1.2 Supportive Government Policies And Incentives To Develop And Operate CHP Plants

      2. 4.5.2 Restraints

        1. 4.5.2.1 Increasing Natural Gas Prices in the United Kingdom

    6. 4.6 Supply Chain Analysis

    7. 4.7 PESTLE Analysis

    8. 4.8 CHP Power Plant Statistics, 2014-2022 (by Number and Capacity)

    9. 4.9 CHP Power Plant Fuel Used Statistics (by Fuel Type and Sector)

  5. 5. MARKET SEGMENTATION

    1. 5.1 End User

      1. 5.1.1 Industrial Sector

      2. 5.1.2 Commercial and Transportation Sector

      3. 5.1.3 Other End Users (Agriculture, Community Heating, Leisure, etc.)

    2. 5.2 Type

      1. 5.2.1 Gas Turbine

      2. 5.2.2 Steam Turbine

      3. 5.2.3 Other Types (Reciprocating Engine and Organic Rankine Cycle CHP)

  6. 6. COMPETITIVE LANDSCAPE

    1. 6.1 Mergers and Acquisitions, Joint Ventures, Collaborations, and Agreements

    2. 6.2 Strategies Adopted by Leading Players

    3. 6.3 Company Profiles

      1. 6.3.1 Caterpillar Inc.

      2. 6.3.2 Centrica PLC

      3. 6.3.3 General Electric Company

      4. 6.3.4 Mitsubishi Power Ltd

      5. 6.3.5 Siemens Energy AG

      6. 6.3.6 Ramboll Group

      7. 6.3.7 Helec Limited

      8. 6.3.8 Tedom AS

    4. *List Not Exhaustive
  7. 7. MARKET OPPORTUNITIES AND FUTURE TRENDS

    1. 7.1 Technological Advancements in Combined Heat And Power (CHP) Systems

**Subject to Availability
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UK Combined Heat and Power (CHP) Industry Segmentation

Combined heat and power is a technology that generates heat and electricity simultaneously, from the same energy source, in individual homes or buildings.

The United Kingdom combined heat and power market is segmented by type and end-user. By type, the market is segmented into gas turbine, steam turbine, and other types (reciprocating engine and organic rankine cycle CHP). By end-User, the market is segmented into the industrial sector, commercial and transportation sector, and other end users (agriculture, community heating, leisure, etc). For each segment, the market sizing and forecasts have been done based on revenue (USD).

End User
Industrial Sector
Commercial and Transportation Sector
Other End Users (Agriculture, Community Heating, Leisure, etc.)
Type
Gas Turbine
Steam Turbine
Other Types (Reciprocating Engine and Organic Rankine Cycle CHP)
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UK Combined Heat and Power (CHP) Market Research FAQs

The UK Combined Heat And Power (CHP) Market size is expected to reach USD 74.08 million in 2024 and grow at a CAGR of 6.13% to reach USD 99.74 million by 2029.

In 2024, the UK Combined Heat And Power (CHP) Market size is expected to reach USD 74.08 million.

General Electric Company, Caterpillar Inc., Siemens Energy AG, Ramboll Group and Centrica PLC are the major companies operating in the UK Combined Heat And Power (CHP) Market.

In 2023, the UK Combined Heat And Power (CHP) Market size was estimated at USD 69.80 million. The report covers the UK Combined Heat And Power (CHP) Market historical market size for years: 2020, 2021, 2022 and 2023. The report also forecasts the UK Combined Heat And Power (CHP) Market size for years: 2024, 2025, 2026, 2027, 2028 and 2029.

Natural Gas CHP in UK Industry Report

Statistics for the 2024 Natural Gas CHP in UK market share, size and revenue growth rate, created by Mordor Intelligence™ Industry Reports. Natural Gas CHP in UK analysis includes a market forecast outlook to 2029 and historical overview. Get a sample of this industry analysis as a free report PDF download.

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Combined Heat and Power (CHP) in UK Market Size & Share Analysis - Growth Trends & Forecasts (2024 - 2029)