The Global Power Rental Systems Market is projected to be valued at an estimated $24 billion US dollars by the year 2020, a compound annual growth rate of 5 percent. The key drivers for the growth of this market are expected to be an increase in the instability of power grids, as well as the spikes in power during peak times. Moreover, a heightened focus toward lower peak power consumption to lower the cost of electricity is also expected to augment the growth of this market on a global scale.
Power rental systems are utilized in several industries as a result of the heightened demand for non-stop power. As the increased dependency for power across various industries has led to the heightened use of power rental systems in recent years, and is expected to contribute to the growth of this industry on a global scale.
Factors Contributing to the Growth of the Global Power Rental Systems Market
Several factors are expected to contribute to the growth of the global power rental systems market during the forecasted time period. It is predicted that the increase of infrastructure development will largely account for the growth of this market, as there will be a greater need for electricity and power in order to successfully execute new roadways, transportation systems and the like.
The heightened demand for power use in both industrial and commercial applications has lead to a gap in supply and demand within the power market. The gap is even larger during peak hours of power consumption. Power rental systems serve as a temporary means of power during times when there is a low supply of power. This will also contribute to the increase in value of the global power rental systems market.
More incentives offered by governments in both developed and developing economies, as well as more investments for research and development of power rental products will also surge the augmentation of this market on a global scale.
Peak shaving is also expected to boost the value of this market. Peak shaving refers to a technique that is used to lower the cost of power bills by curbing the consumption of power during peak hours when the cost of electricity is the highest. Power rental units help to control the demand of power during peak hours, which thereby helps to control the cost of electric bills.
Lastly, the increasing size of the global population has lead to a greater demand for power. This will, in turn, continue to significantly boost the growth of the global power rental systems market.
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Augmentation of the Global Power Rental Systems Market by Product
Diesel and gas are expected to account for the largest shares of the power rental system market worldwide. In 2015, diesel dominated the industry, holding more than 76 percent of the total share of this market. Tremendous growth of the global population has led to an increased demand for electricity. As such, more generators are being used to provide power as a direct source, as a substitute when there is a high demand for power, or as a standby source of power in the event of outages. Generators are largely powered by diesel, hence the reason why this product has dominated this market in the past, and will continue to dominate it in the future.
Moreover, the long lifespan of diesel generators and the high density of energy that diesel fuel provides makes it the perfect solution for the power supplied by generators.
Increased Growth of the Global Power Rental Systems Market by End User
The following end users are expected to significantly contribute to the increased demand, and therefore value, of the global power rental systems market:
- Oil and gas
Experts have predicts that the oil and gas segment will lead the industry during the forecasted time period, with a projection that it will account for 37 percent of the total market share by the year 2020. The oil and gas sector relies on power generators as a short-term solution to meet power requirements.
It is believed that government and events will also remain important end user segments to contribute to the growth of the power rental market worldwide. The compound annual growth rate of these end users is expected to be an estimated 16 percent during the forecasted time period.
The industrial segment has also been a large end user in this industry in recent years, and it is expected to continue as such in the coming years. The industrial sector is projected to rapidly expand in Asia Pacific and the Middle East, as large companies are shifting their manufacturing activities to these locations.
The construction industry will also be a key consumer throughout the forecasted time period, as a result of growing infrastructure development. The rapid urbanization of developing countries is expected to significantly fuel the growth of this segment.
Regional Growth of the Global Power Rental Systems Market
In 2012, Asia Pacific and the Middle East dominated the power rental systems market. It is expected that these regions will continue to hold the highest market share in the coming years, as there will continue to be increased industrialization, as well as development in oil and gas. Moreover, a lack of a reliable power supply from utility power grids, particularly to island locations, where the demand for electricity has increased significantly in recent years.
North America will also contribute largely to the growth of this market during the forecasted time period. It is projected that this region will see market growth as a result of increased consciousness of end users of the benefits of rental equipment; the availability of additional capital, for example. However, it should be noted that the mature nature of market conditions in this region, combined with an uncertain economic climate, are expected to slightly hinder the development of the power rental market in the coming years in this region.