Inefficient, outdated permanent power plants have become a prominent cause of environmental pollution. As a result, governments across the world are implementing strict rules to shut down outdated plants, to preserve the environment to a certain extent. Even though these plants are inactive, they need power on rent for the redevelopment process. Thus, the frequent shutting down and redevelopment of power plants and stringent environmental regulations will amplify the requirement for power on rent, globally.
In recent years, emerging economies like China, Qatar, India, Thailand, South Korea, Turkey, and Brazil have witnessed a rapid surge in power demand. To meet it, these countries are focusing more and more on rental power. Additionally, owing to the continuous technological investments and high foreign investments in the construction industry, the demand for power rental systems will rise tremendously. This will, therefore, fuel the power rental market at a 10.3% CAGR during 2018–2023. The market was valued at $9,167.6 million in 2017, and it is expected to reach $16,855.5 million by 2023.
Currently, the utilities sector displays the highest adoption of power rental systems. This is due to the vast requirement for rented electricity for the upgradation and redevelopment of obsolete power plants and for their maintenance. With the aging network of thermal power plants, the need for rented power will escalate in the coming years. Apart from this, the industrial, oil and gas, mining, and events sectors will also procure a large number of power rental systems in the near future.
These end users install diesel generators and gas generators for supplying prime, standby, and continuous power, as per requirement. Globally, these end users have shown a higher inclination for diesel generators due to their lower purchase and maintenance costs as compared to gas generators. These rented systems are primarily used to maintain a continuous power supply in oil and gas plants, mines, manufacturing units, and construction sites. In the coming years, the customers of rented electricity will majorly adopt generators with a power range of 51 kilowatts (kW)–500 kW.
Globally, the Middle East and Africa (MEA) region was the largest user of power rental systems in the past. This was due to the high electricity consumption in the construction sector and immediate need to supply electricity to outdated power plants. Moreover, a surge in infrastructure investments, primarily in Oman, Saudi Arabia, and the U.A.E, have propelled the adoption of such systems to meet the increasing electricity demand. Moreover, the MEA is also expected to witness the fastest growth in the procurement of generators in the future owing to the vast electricity demand arising from end-use sectors like construction, events, and utilities.
Thus, the increasing number of outdated power plants and surging requirement for rented electricity from the utilities, construction, mining, and industrial sectors will accelerate the adoption of rented power systems, worldwide.
