2025 forecast: ‘stable’ for power gen market

After the hyper growth of 2021 and 2022 and the historic market peak of 2023, the decline that began in the second half of 2023 has been confirmed over 2024 (-5%). The market should stabilize in 2025, but with a notable decline in the very low power sector (less than 75 kVA). Higher power sectors will experience better market conditions.

There are currently very few growth sectors and related indicators do not show a clear recovery in the market, although it will still be necessary to monitor geopolitical (Ukraine, Middle East), economic (China), and climate-related events.

In terms of product mix, and despite real growth in BESS sales, diesel generators still appear to be the main technology for energy backup and mobile power in the sub 750 kVA power range. The market is not being cannibalized in the short- or medium-term by other technologies. Some segments (eg. Rental Europe) use batteries as complementary products rather than replacements for diesel gen sets.

Sub 750 kVA Outlook

Mobile & Rental Groups - The market has slowed down in Europe after several years of growth. The construction market largely affects this segment, which should stabilize at levels lower than the 2022-2023 peak. In North America the market is also slowing down after several years of sustained growth.

Industry & Construction - After years of strong growth, the market is now down in most regions. But there are still great opportunities, as in Saudi Arabia for example, or in India where these sectors are dynamic and promising.

Telecom - Although the development of 5G still benefits this segment, growth will be very moderate in 2024 because certain markets (eg. United States) after driving growth are now in decline. The market in Asia should be more sustained.

Forecast by Region

China - The national market will continue to suffer in 2025 as residential housing projects remain very low. However, the impact of recent stimulus packages from the Chinese Central Bank will have to be monitored. These could boost growth.

South East Asia - This is one of the strongest regions. It will continue to perform better than others due to economic dynamism, public infrastructure spending and tourism.

India - This is another region that will evolve more positively. Stronger than expected economic performance, government expenditure and resilient investment will support the market in the near term.

Europe – After a difficult 2024 the region will return to relative stability in 2025. The market will return to pre-energy crisis volumes. Ukraine demands close attention, as a market for gen sets to supplement damaged power infrastructure and reconstruction potential.

Africa & Middle East - This market will experience very diverse trends. On the one hand, Saudi Arabia will still be the growth driver, led by Neom’s pharaonic projects. Nigeria has strong energy needs, but most African countries will be affected by the decline in global growth.

North America - After several years of uninterrupted growth, the mobile and telecom segments have entered a downward cycle. This is expected to continue over 2024-2025, with the 5G network now well established.

South America - The market will be complicated in this region. The economic situation in most countries is not showing signs of recovery.

Editor’s note: this article originally appeared in the October - December 2024 issue of Power Progress International.