Gas Engine Market To Generate $6,334.7 Million Revenue by 2030

The gas engine market size is expected to advance at a CAGR of 4.0% during 2023–2030, to reach USD 6,334.7 million by 2030.

The major growth factors for the market are the increasing focus on the development of fuel-efficient engines, strong emphasis on the reduction of carbon emissions, and increase in the demand for natural gas as fuel.

Gas engines can be powered by a range of fuels, such as natural, producer, landfill, and coal gas, as well as biogas. Their typical power output is between 10 kW (13 hp) and 4 MW (5,364 hp). They are designed to be highly reliable, operate at a low cost, and maximize electrical and thermal efficiency, which often stands at 90%. Moreover, despite their high build and operational costs, they are suitable for use in urban settings due to their significantly lower pollution level than diesel engines.

Utilities Category to Witness Fastest Growth

Based on end user, the market is classified into utilities, oil and gas, manufacturing, marine, and others (commercial complexes, wastewater treatment plants, hospitals, and greenhouse operators). Among these, the utilities category is predicted to expand at the highest rate, of around 6%, over the projection timeframe, due to an expanding global population, rapid urbanization in developing countries, and increasing number of consumers. Utilities feed power to local electricity grids or use it to power local facilities. Gas engines are used by utilities to meet the peak demand and provide electricity in the event of a main power plant failure, thus preventing a blackout.

Moreover, to comply with the government-imposed emission regulations, there is a rapid shift away from coal-fired power plants toward gas-fired power plants. Power plants' overall efficiency is also improved when cogeneration, or the combined heat and power (CHP) technology, is used. The majority of these engines use landfill gas, natural gas, coal gas, or biogas.

Natural Gas Category Dominates Market

The natural gas category held the largest share of the market in 2022. Natural gas is mostly used in gas engines for electricity generation as it burns cleaner and generates lower carbon dioxide, nitrogen oxide, sulfur dioxide, and particulate matter emissions compared to other gaseous fuels. The U.S., Russia, the U.K., France, Germany, China, and Canada are strengthening their natural gas distribution networks, which is expected to create a high demand for gas engines. Many gas distribution companies provide natural gas capsules for remote industrial facilities, where gas distribution networks cannot reach.

Increasing Focus on Development of Fuel-Efficient Engines

Emissions from diesel and gasoline engines are regulated by many nations' governments. As a result, engine manufacturers have been forced to choose natural gas or other alternative fuels. Additionally, gas engines produce power with high efficiency, while emitting fewer emissions. Major heavy industries, manufacturing companies, and remote power plants are using high-power gas engines as they offer higher efficiency at lower fuel expenses. For that reason, gas engine manufacturers are focusing on offering advanced products, to address the rising demand for high power outputs and meet the prevalent emission standards.

Mergers and Acquisitions Are Key Strategic Developments Taken by Players

In February 2021, TMH International, along with British company Rolls-Royce plc, acquired the Bergen Engines factory in Norway, which manufactures diesel and medium-speed gas engines. Rolls-Royce has signed an agreement to sell the Bergen Engines’ medium-speed gas and diesel engines business to TMH International, the international branch of TMH Group.

Moreover, in January 2022, Cummins closed its acquisition of 50% equity interest in Momentum Fuel Technologies from Rush Enterprises. The partnership will help Cummins bring clean and efficient natural gas engines up to 15 liters in capacity to customers globally.

The biggest global gas engine market players are Caterpillar Inc., General Electric, Rolls-Royce plc, Siemens AG, Jenbacher, Mitsubishi Heavy Industries Ltd., Kawasaki Heavy Industries Ltd., and IHI Power Systems.