Microgrid Market - Global Market Share, Trends, Analysis and Forecast, 2023-2032
The global microgrid market was estimated to be US$ 28.39 Billion in 2022 and is expected to reach US$ 167.21 Billion by 2032 at a CAGR of 19.4%.
A microgrid is a small-scale power system that can operate independently or in conjunction with a larger electrical grid. It consists of a group of interconnected electricity sources and loads within a clearly defined boundary, such as a campus, military base, or remote community. Microgrids can incorporate a variety of power generation sources, such as solar panels, wind turbines, fuel cells, and batteries, to create a flexible and resilient power system.
Microgrids can be designed to operate autonomously or to interact with the main grid as needed, providing backup power during outages or peak demand periods. They can also be configured to optimize energy efficiency, reduce carbon emissions, and improve energy security and resilience.
Microgrid Market Drivers
Increasing adoption of renewable energy sources is driving the market growth
The global microgrid market is being driven by several key factors. Firstly, the increasing demand for reliable and efficient power supply, particularly in remote and off-grid locations, is pushing businesses and communities towards microgrids.
Secondly, the growing adoption of renewable energy sources is driving the integration of these intermittent sources into microgrids, enabling them to meet electricity needs sustainably. Thirdly, government initiatives to promote microgrid installations are providing incentives for their development and deployment worldwide.
Lastly, the rising need for energy security and resilience is driving the adoption of microgrids as backup power sources that can operate independently of the main grid during natural disasters and other disruptions.
Overall, these factors are accelerating the adoption of microgrids, which are proving to be a more reliable, efficient, and sustainable alternative to traditional power systems. Microgrids are becoming increasingly popular across the globe, as businesses and communities seek to reduce their reliance on traditional power systems and transition towards a more sustainable and resilient energy future.
Application Segmentation of Global Microgrid Market
Commercial and industrial is the largest application segment in the market
Based on application, the commercial and industrial segment is currently the largest application segment in the microgrid market. This is due to the high energy consumption of commercial and industrial facilities, which can benefit significantly from microgrids in terms of cost savings, energy reliability, and resilience.
Commercial and industrial microgrids can be used to provide backup power during outages, to reduce peak demand charges, and to integrate renewable energy sources to reduce reliance on traditional grid electricity. Additionally, microgrids can provide greater control over energy usage and optimize energy management, which can result in significant cost savings over time.
Institutions and campus microgrids are also a significant segment of the market, particularly in universities, hospitals, and other large campuses. These microgrids provide a reliable and resilient source of power, particularly during natural disasters or other emergencies, ensuring the continued operation of critical facilities and services.
Overall, while all application segments of the microgrid market are growing, the commercial and industrial segment is currently the largest due to the significant cost savings and energy reliability benefits that microgrids can provide to these types of facilities.
Regional Trends of the Global Microgrid Market
Asia-Pacific region is expected to be the fastest-growing market for microgrids
Geographically, the global microgrid market is segmented into North America, Europe, Asia-Pacific, Middle East and Africa, and South America.
Following are some of the major trends in these regions –
North America: North America is currently the largest market for microgrids, driven by a combination of factors including a high level of investment in renewable energy, government incentives and regulations, and a growing demand for resilient power systems. The United States accounts for a significant portion of the North American market, with a large number of microgrid installations across various sectors including commercial and industrial, military, and utilities.
Europe: Europe is another significant market for microgrids, with a focus on the integration of renewable energy sources and energy storage systems. Countries such as Germany, Italy, and the United Kingdom have implemented policies and programs to encourage the deployment of microgrids, particularly in remote and off-grid areas.
Asia-Pacific: The Asia-Pacific region is expected to be the fastest-growing market for microgrids, driven by factors such as increasing demand for reliable and affordable energy, rapid industrialization, and government initiatives to promote renewable energy and energy security. China, India, and Japan are among the largest markets in the region, with a significant number of microgrid installations in various sectors.
Middle East and Africa: The Middle East and Africa region is also seeing growing interest in microgrids, particularly in remote and off-grid areas where access to traditional power sources may be limited. Countries such as Saudi Arabia, the UAE, and South Africa have implemented policies and programs to encourage the development of microgrids, particularly in rural areas.
South America: South America is a relatively small market for microgrids, but is expected to see significant growth in the coming years, driven by a growing demand for renewable energy, increasing investment in the energy sector, and a need for reliable and resilient power systems. Brazil, Chile, and Argentina are among the largest markets in the region, with a focus on commercial and industrial microgrids.
Key players and market strategies:
Companies operating in the global microgrid market have adopted various growth strategies to expand their market presence and gain a competitive edge.
Here are some of the major growth strategies adopted by these companies:
Partnerships and collaborations: Many companies have formed partnerships and collaborations to enhance their technological capabilities, expand their product offerings, and enter new markets. For example, ABB and Rolls-Royce formed a partnership to develop microgrid systems for the shipping industry.
Investments in R&D: Companies are investing in research and development to develop new and innovative microgrid technologies, reduce costs, and enhance efficiency. For example, Siemens is investing in R&D to develop intelligent microgrid solutions that can integrate multiple energy sources and storage systems.
Acquisitions and mergers: Companies are also acquiring or merging with other companies to expand their market presence and gain access to new technologies and capabilities. For example, Schneider Electric acquired the microgrid business of Massachusetts-based company, Advanced Microgrid Solutions.
Expansion into new markets: Many companies are expanding their operations into new markets to tap into the growing demand for microgrids. For example, ENGIE is expanding its microgrid operations in Asia-Pacific, with a focus on off-grid and remote areas.
Diversification of product offerings: Companies are also diversifying their product offerings to cater to the varying needs of customers across different sectors. For example, Tesla has expanded its product offerings to include microgrid solutions that integrate solar panels, battery storage, and energy management software.
ABB Ltd, Eaton Corporation PLC, General Electric Company, Hitachi, Ltd., Honeywell International Inc., Johnson Controls International plc, Lockheed Martin Corporation, Power Analytics Corporation, Schneider Electric SE, Siemens AG, S&C Electric Company, Spirae, Inc., Tesla Inc., Toshiba Corporation, Wärtsilä Corporation and many more.
Global Microgrid Market Segmentation:
By Type of Grid:
- AC Microgrid
- DC Microgrid
- Hybrid Microgrid
By Application:
- Remote electrification
- Institutions and campus
- Commercial and industrial
- Military
- Utilities
- Others
By Power Source:
- Heavy Fuel Oil/Diesel Generators
- Natural Gas Generators
- Solar PV
- Combined Heat and Power
- Others
By End-User:
- Residential
- Commercial
- Industrial
By Region
- North America
- United States
- Canada
- Rest of North America
- Europe
- Germany
- United Kingdom
- Italy
- France
- Spain
- Rest of Europe
- Asia Pacific
- Japan
- India
- China
- Australia
- South Korea
- Rest of Asia Pacific
- Middle East & Africa
- UAE
- Saudi Arabia
- South Africa
- Rest of the Middle East & Africa
- South America
- Brazil
- Rest of South America
- Introduction
- Research Objectives
- Report Assumptions
- Research Methodology
- Abbreviations
- Preface
- Market Definition
- Report Scope and Market Segmentation
- Research Highlights
- Market Synopsis: Global Microgrid Market
- Global Microgrid Market Qualitative Analysis
- Trends
- Market trends
- Technology Trends
- PESTLE Analysis (For 3 prominent countries)
- Market Influencers
- Driving Forces
- Hindering Forces
- Opportunities
- COVID-19 impact
- Porter’s Five Forces
- Trends
- Global Microgrid Market Analysis and Forecast, by Grid Type
- Overview and definitions
- Key segment analysis
- Global Microgrid Market Size Estimates (US$ Mn), by Grid Type, 2019 – 2032
- AC Microgrid
- DC Microgrid
- Hybrid Microgrid
- Global Microgrid Market Analysis and Forecast, by Power Source
- Overview and definitions
- Key segment analysis
- Global Microgrid Market Size Estimates (US$ Mn), by Power Source, 2019 – 2032
- Diesel/Heavy Fuel Oil Generators
- Natural Gas Generators
- Solar PV
- Combined Heat and Power
- Others
- Global Microgrid Market Analysis and Forecast, by Application
- Overview and definitions
- Key segment analysis
- Global Microgrid Market Size Estimates (US$ Mn), by Application, 2019 – 2032
- Remote electrification
- Institutions and campus
- Commercial and industrial
- Military
- Utilities
- Others
- Global Microgrid Market Size Estimates (US$ Mn), by End Use, 2019 – 2032
- Overview and definitions
- Key segment analysis
- Global Microgrid Market Size Estimates (US$ Mn), by End Use, 2019 – 2032
- Residential
- Commercial
- Industrial
- Global Microgrid Market Analysis and Forecast, by Region
- Overview and definitions
- Key segment analysis
- Global Microgrid Market Size Estimates (US$ Mn), by Region, 2019 – 2032
- North America
- Europe
- Asia Pacific
- Middle East & Africa
- South America
- North America Microgrid Market Analysis and Forecast
- Overview and definitions
- Key segment analysis
- North America Microgrid Market Size Estimates (US$ Mn), by Grid Type, 2019 – 2032
- AC Microgrid
- DC Microgrid
- Hybrid Microgrid
- North America Microgrid Market Size Estimates (US$ Mn), by Power Source, 2019 – 2032
- Diesel/Heavy Fuel Oil Generators
- Natural Gas Generators
- Solar PV
- Combined Heat and Power
- Others
- North America Microgrid Market Size Estimates (US$ Mn), by Application, 2019 – 2032
- Remote electrification
- Institutions and campus
- Commercial and industrial
- Military
- Utilities
- Others
- North America Microgrid Market Size Estimates (US$ Mn), by End Use, 2019 – 2032
- Residential
- Commercial
- Industrial
- North America Microgrid Market Size Estimates (US$ Mn), Country, 2019 – 2032
- The U.S.
- Canada
- Rest of North America
- Europe Microgrid Market Analysis and Forecast
- Overview and definitions
- Key segment analysis
- Europe Microgrid Market Size Estimates (US$ Mn), by Grid Type, 2019 – 2032
- AC Microgrid
- DC Microgrid
- Hybrid Microgrid
- Europe Microgrid Market Size Estimates (US$ Mn), by Power Source, 2019 – 2032
- Diesel/Heavy Fuel Oil Generators
- Natural Gas Generators
- Solar PV
- Combined Heat and Power
- Others
- Europe Microgrid Market Size Estimates (US$ Mn), by Application, 2019 – 2032
- Remote electrification
- Institutions and campus
- Commercial and industrial
- Military
- Utilities
- Others
- Europe Microgrid Market Size Estimates (US$ Mn), by End Use, 2019 – 2032
- Residential
- Commercial
- Industrial
- Europe Microgrid Market Size Estimates (US$ Mn), Country, 2019 – 2032
- Germany
- United Kingdom
- Italy
- France
- Spain
- Rest of Europe
- Asia Pacific Microgrid Market Analysis and Forecast
- Overview and definitions
- Key segment analysis
- Asia Pacific Microgrid Market Size Estimates (US$ Mn), by Grid Type, 2019 – 2032
- AC Microgrid
- DC Microgrid
- Hybrid Microgrid
- Asia Pacific Microgrid Market Size Estimates (US$ Mn), by Power Source, 2019 – 2032
- Diesel/Heavy Fuel Oil Generators
- Natural Gas Generators
- Solar PV
- Combined Heat and Power
- Others
- Asia Pacific Microgrid Market Size Estimates (US$ Mn), by Application, 2019 – 2032
- Remote electrification
- Institutions and campus
- Commercial and industrial
- Military
- Utilities
- Others
- Asia Pacific Microgrid Market Size Estimates (US$ Mn), by End Use, 2019 – 2032
- Residential
- Commercial
- Industrial
- Asia Pacific Microgrid Market Size Estimates (US$ Mn), Country, 2019 – 2032
- Japan
- India
- China
- Australia
- Rest of Asia Pacific
- Middle East & Africa Microgrid Market Analysis and Forecast
- Overview and definitions
- Key segment analysis
- Middle East & Africa Microgrid Market Size Estimates (US$ Mn), by Grid Type, 2019 – 2032
- AC Microgrid
- DC Microgrid
- Hybrid Microgrid
- Middle East & Africa Microgrid Market Size Estimates (US$ Mn), by Power Source, 2019 – 2032
- Diesel/Heavy Fuel Oil Generators
- Natural Gas Generators
- Solar PV
- Combined Heat and Power
- Others
- Middle East & Africa Microgrid Market Size Estimates (US$ Mn), by Application, 2019 – 2032
- Remote electrification
- Institutions and campus
- Commercial and industrial
- Military
- Utilities
- Others
- Middle East & Africa Microgrid Market Size Estimates (US$ Mn), by End Use, 2019 – 2032
- Residential
- Commercial
- Industrial
- Middle East & Africa Microgrid Market Size Estimates (US$ Mn), Country, 2019 – 2032
- Saudi Arabia
- South Africa
- UAE
- Rest of Middle East
- South America Microgrid Market Analysis and Forecast
- Overview and definitions
- Key segment analysis
- South America Microgrid Market Size Estimates (US$ Mn), by Grid Type, 2019 – 2032
- AC Microgrid
- DC Microgrid
- Hybrid Microgrid
- South America Microgrid Market Size Estimates (US$ Mn), by Power Source, 2019 – 2032
- Diesel/Heavy Fuel Oil Generators
- Natural Gas Generators
- Solar PV
- Combined Heat and Power
- Others
- South America Microgrid Market Size Estimates (US$ Mn), by Application, 2019 – 2032
- Remote electrification
- Institutions and campus
- Commercial and industrial
- Military
- Utilities
- Others
- South America Microgrid Market Size Estimates (US$ Mn), by End Use, 2019 – 2032
- Residential
- Commercial
- Industrial
- South America Microgrid Market Size Estimates (US$ Mn), Country, 2019 – 2032
- Brazil
- Rest of South America
- Competition Analysis – Microgrid Market
- Market Composition
- Market Share Analysis (%), by Supplier (2022)
- Company Profiles
- ABB Ltd
- Business overview
- Geographic presence
- Financial facts
- Relevant news and strategic view
- Eaton Corporation PLC
- General Electric Company
- Hitachi, Ltd.
- Honeywell International Inc.
- Johnson Controls International plc
- Lockheed Martin Corporation
- Power Analytics Corporation
- Schneider Electric SE
- Siemens AG
- S&C Electric Company
- Spirae, Inc.
- Tesla Inc.
- Toshiba Corporation
- Wärtsilä Corporation
- ABB Ltd
- Conclusion & Recommendations
Frequently asked questions about this report
What is the microgrid market growth?
The microgrid market is expected grow at a CAGR of 19.4% from 2023 to 2032.
How large is the microgrid market?
The microgrid market size is expected to reach US$ 167.21 Billion by 2032.
What was the value of the microgrid market in 2022?
The microgrid market was estimated to be US$ 28.39 Billion in 2022.
What are the key drivers for the global microgrid market?
The global microgrid market is being driven by the increasing demand for reliable and efficient power supply, growing adoption of renewable energy sources, and rising need for energy security and resilience.
Which is the largest regional market for microgrid?
North America is currently the largest market for microgrids, driven by a combination of factors including a high level of investment in renewable energy, government incentives and regulations, and a growing demand for resilient power systems.
Who are the key players in microgrid market?
ABB Ltd, Eaton Corporation PLC, General Electric Company, Hitachi, Ltd., Honeywell International Inc., Johnson Controls International plc, Lockheed Martin Corporation, Power Analytics Corporation, Schneider Electric SE, Siemens AG, S&C Electric Company, Spirae, Inc., Tesla Inc., Toshiba Corporation, Wärtsilä Corporation among others, are the key players in this market.
Which application is the largest in the microgrid market?
The commercial and industrial segment is the largest application segment in the microgrid market. This is due to the high energy consumption of commercial and industrial facilities, which can benefit significantly from microgrids in terms of cost savings, energy reliability, and resilience.