Combined heat and power (CHP), also known as cogeneration, is an efficient process that generates electricity and thermal energy in a single integrated system. CHP systems capture heat that would otherwise be wasted in conventional power generation and transmit it for building space or water heating, or industrial processes. This dual-purpose system significantly reduces energy waste compared to separate heat and power generation. CHP systems can use natural gas, biomass, biogas, coal, waste heat, and other heat sources to generate electricity and useful heat at the point of use with an overall efficiency of 60-80%. CHP systems are used in various commercial buildings, factories, hospitals, district heating systems, and campuses for their energy-efficient operations. The global CHP Market is estimated to be valued at US$ 31.09 Bn in 2023 and is expected to exhibit a CAGR of 12% over the forecast period 2024 to 2031, as highlighted in a new report published by Coherent Market Insights.
Market Dynamics:
Rising demand for clean and efficient energy solutions is expected to drive growth of the global CHP market over the forecast period. CHP systems reduce carbon emissions significantly by using wasted heat from power generation and thus considered as an environment-friendly technology. According to the Environmental Protection Agency, widespread deployment of CHP could reduce U.S power sector carbon dioxide emissions by approximately 10%. Stringent government regulations regarding reduction of carbon emissions will further boost adoption of CHP systems in the coming years. Further, growth of the industrial and commercial buildings sector which demands both heat and electricity will also support growth of the global CHP market during the forecast period. With rising awareness regarding energy security and cost savings, CHP is poised to create numerous opportunities for market players in the years ahead.
Segment Analysis
The global combined heat and power (CHP) market is divided into micro CHP, small CHP, and large CHP. The large CHP segment dominates the market and accounted for over 60% share in 2024. Large CHP systems are suitable for applications involving high thermal and electric loads such as district heating, commercial buildings, and factories. They provide better fuel efficiency compared to separate heat and power generation.
PEST Analysis
Political: Supportive government policies and regulations regarding distributed generation are boosting the CHP market. Some countries provide tax incentives for CHP systems.
Economic: CHP helps reduce energy costs for commercial and industrial applications. It allows utilization of waste heat from power generation for heating purposes.
Social: CHP systems help reduce reliance on fossil fuel-based centralized power generation and promote distributed renewable power sources. This positively impacts the environment.
Technological: Advancements in gas turbine, reciprocating engine, and fuel cell technologies are enhancing the operational efficiency of CHP systems. Integrated controls and monitoring systems also support automation and remote management.
Key Takeaways
The global combined heat and power (CHP) market share is expected to witness high growth over the forecast period of 2024 to 2031.
Regional analysis:
The Asia Pacific region accounts for over 35% of the global CHP market. China dominates the regional market due to large-scale industrial and construction activities. The country also offers financial incentives for CHP systems. Other major Asian markets include Japan and India.
Key players
operating in the CHP market are Lonza Group Ltd., Thermo Fisher Scientific Inc., Merck KGaA, and STEMCELL Technologies Inc. Lonza and Thermo Fisher are prominent biotechnology companies providing reagents and media for cell culture processes. Merck KGaA offers specialized solutions for cell culture and stem cell research. STEMCELL Technologies provides cell culture media and cell separation products
*Note:
1. Source: Coherent Market Insights, Public sources, Desk research
2. We have leveraged AI tools to mine information and compile it
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