by Brianna Crandall — March 10, 2014—Facilities managers in the manufacturing sector who are investigating ways to reduce energy costs may be interested in a new report from market research and consulting firm Navigant Research that forecasts an upcoming resurgence in the use of industrial combined heat and power (CHP). According to the report, worldwide revenue from industrial CHP will grow from $19.7 billion annually in 2013 to $29.8 billion in 2023.
One of the most mature distributed generation segments, the industrial CHP, or cogeneration, market represents slightly less than six percent of global installed electricity generating capacity. Although growth in the industrial CHP market has stagnated in countries like the United States and Russia in recent years, the confluence of a number of drivers points to renewed interest in this proven technology platform across all regions, says Navigant Research.
“Deployed at small- or large-scale, extraction, processing, and manufacturing sites, cogeneration systems produce electricity while also capturing heat that would otherwise be wasted,” says Mackinnon Lawrence, principal research analyst with Navigant Research. “While currently installed industrial combined heat and power capacity is mostly concentrated in energy-consuming economies that have large industrial processing and manufacturing bases, growth in emerging markets, along with the expansion of refinery assets to serve these markets, represents an attractive opportunity.”
North America, Western Europe, and Eastern Europe accounted for 80 percent of installed industrial CHP capacity worldwide in 2012, but the diversity in fuel use, technologies, and end users makes the industrial CHP market highly dynamic across the world, according to the report. Driven by concerns about grid reliability, meeting demand for electricity, improving grid efficiency, and reducing greenhouse gas emissions, many governments are increasing subsidies and other incentives for the adoption of industrial CHP systems.
The report, Industrial Combined Heat and Power, analyzes the global market potential for industrial CHP systems for a range of industrial applications — including refineries, pulp and paper mills, and food processing facilities — using technologies such as turbines, internal combustion engines, fuel cells, and Organic Rankine Cycle engines. The report includes in-depth assessments of 10 leading countries for the installation of industrial CHP systems, and provides an outlook for increased fuel switching to natural gas.
Global market forecasts for installed capacity and revenue, segmented by region, country, and scenario, extend through 2023. The report also examines the key market drivers and barriers related to industrial CHP and the main industry players engaged in this market. An Executive Summary of the report is available for free download on the Navigant Research Web site.
