Air-Cooled Generators Market Expected to Reach $7 Billion by 2032

According to a new report published by Allied Market Research, titled, “Air-Cooled Generators Market," The air-cooled generators market size was valued at $4.1 billion in 2022, and is estimated to reach $7.0 billion by 2032, growing at a CAGR of 5.7% from 2023 to 2032.

Introduction

An air-cooled generator is a type of electrical generator that utilizes air as the primary medium for dissipating heat generated during its operation. This type of generator typically consists of components such as stator windings, rotor windings, and other electrical elements that produce heat during electricity generation. It is commonly used in smaller-scale applications such as portable generators, small standby generators, and some types of renewable energy systems such as wind turbines. It is simple in design & operation and does not require complex cooling systems, which makes it more cost-effective and easier to maintain in certain applications.

Market Dynamics

Air-cooled generators offer a reliable solution to address the intermittent renewable energy sources by providing backup power during periods of low or inconsistent energy production. This is particularly crucial for off-grid or remote locations where access to stable grid power is limited or non-existent. By seamlessly integrating with renewable energy systems, air-cooled generators ensure a continuous and reliable power supply and enhance the overall efficiency and reliability of renewable energy installations. Furthermore, the decentralized nature of renewable energy generation, such as solar panels or wind turbines requires distributed power solutions to support various applications and locations. Air-cooled generators, with their compact and portable design, are well-suited for such decentralized setups. They are easily transported and deployed in diverse environments without the need for complex infrastructure or extensive cooling systems that makes them an ideal complement to renewable energy systems in remote or rural areas. All these factors are anticipated to drive the air cooled generators market trends.

However, the physical constraints of air-cooled generator designs pose significant hurdles for high-power applications. To ensure adequate cooling, air-cooled generators often require larger heat sinks and more robust cooling fans compared to liquid-cooled alternatives. These components add bulk and weight to the generator, making it less portable and adaptable to scenarios where space and mobility are crucial considerations. Consequently, the size and weight of air-cooled generators pose logistical challenges in environments where compactness and maneuverability are essential, such as construction sites or remote work locations. All the factors hamper the air-cooled generators market growth.

The surge in construction and infrastructure development projects presents significant opportunities for air-cooled generators. In October 2021, the Dubai government and India signed a contract to build infrastructure in Jammu and Kashmir, such as industrial parks, IT towers, multipurpose towers, logistics centers, medical colleges, and specialized hospitals. These projects often require reliable and portable power sources to support various activities such as on-site operations, temporary facilities, and remote locations where grid power is unavailable or unreliable. Air-cooled generators, with their compact and easily transportable design, are well-suited to meet these demands, providing a flexible and efficient power solution for construction sites, infrastructure projects, and related applications. All these factors are anticipated to offer new growth opportunities in the air cooled generators market forecast.

Segments Overview

The air-cooled generators market is segmented on the basis of type, system, end user, and region. On the basis of type, the market is bifurcated into portable and stationary. The portable segment is anticipated to grow at the fastest CAGR of 5.8% during the forecast period. The advancements in technology have led to the development of more efficient, compact, and lightweight portable air-cooled generators with improved fuel efficiency, noise reduction, and user-friendly features. These advancements have expanded the market by making portable generators more accessible and attractive to a wider range of users, including homeowners, outdoor enthusiasts, small businesses, and recreational vehicle owners.

On the basis of system, the market is divided into medium and high. The enclosed system is anticipated to grow at the fastest CAGR of 5.83% during the forecast period. Enclosed systems offer versatility and adaptability for air-cooled generators, allowing for customization and integration with additional features and accessories. For instance, integration of additional features such as automatic transfer switches (ATS), remote monitoring systems, and load management modules offers several advantages such as seamless transition, real time insight, and efficient power distribution. These enclosures are designed to accommodate specific requirements such as ventilation systems, exhaust systems, fuel tanks, control panels, and monitoring equipment. By providing a modular and customizable platform, enclosed systems enable seamless integration of ancillary components and facilitate efficient operation and control of air-cooled generators in various applications.

On the basis of end user, the market is classified into residential, industrial, and others. The residential segment is anticipated to grow at the fastest CAGR of 5.85% during the forecast period. The increase in availability of financing options, incentives, and rebates for residential backup power solutions, has made air-cooled generators more accessible and affordable for homeowners. For instance, the Indian government has approved a rebate scheme with a total outlay of approximately $9 billion to promote residential rooftop solar installations. Under this scheme, known as PM-Surya Ghar Muft Bijli Yojana, households benefit from central financial assistance (CFA) for installing rooftop solar systems. Government programs, utility incentives, and insurance discounts for installing backup power systems have incentivized homeowners to invest in air-cooled generators to enhance the resilience and value of their properties.

Regional Analysis

Region-wise, the market is analyzed across North America, Europe, Asia-Pacific, and LAMEA. The Asia-Pacific market is anticipated to grow at the fastest CAGR of 6.11% during the forecast period. The Asia-Pacific region is experiencing rapid investment and population growth, leading to increased demand for residential backup power solutions. According to the India Brand Equity Foundation, in November 2022, National Investment and Infrastructure Fund (NIIF) was set up as a collaborative investment platform between the Government of India, global investors, multilateral development banks (MDB) and domestic financial institutions to facilitate investment across multiple sectors in India through an India Japan Fund. Air-cooled generators are preferred for residential applications due to their portability, ease of installation, and cost-effectiveness compared to larger liquid-cooled generators or stationary backup power systems.

Key players in the air-cooled generators market report include Baker Hughes Company, Briggs & Stratton Corporation, Cummins Inc., GE Vernova, Generac Power Systems, Inc., Honda India Power Products Ltd., Kohler Co., Mitsubishi Heavy Industries, Ltd., Siemens Energy, TOSHIBA CORPORATION, Wartsila, and Yamaha Motor Co. Apart from these major players, there are other key players in the air-cooled generators industry. These include Champion Power Equipment, Eaton Corporation, DeWalt, Westinghouse Electric Corporation, Ryobi Limited, Subaru Corporation, Ingersoll Rand, Techtronic Industries (TTI), Firman Power Equipment, and Subaru Industrial Power Products.

Key Market Insights

• By type, portable segment was the highest revenue contributor to the market accounting for more than two-thirds of global air-cooled generators market share in 2022.
• On the basis of system, the enclosed system segment was the highest revenue contributor to the global air cooled generators market analysis in 2022.
• On the basis of end user, the residential segment was the highest revenue contributor to the market accounting for more than three-fifths of the global air-cooled generators market share in 2022.
• Region-wise, Asia-Pacific was the highest revenue contributor of global air-cooled generators market share in 2022.