Utilities Middle East
GENSET FUTURE TRENDS
Where does the ‘traditional’ fossil fuel powered generator sit in the coming new age of power? Battery technology is advancing, but for the foreseeable future at least, it is unable to provide
necessary power for intensive use demanded by utilities operations
Having a reliable power source is crucial when it comes to business operations. After all, without power generation, there’s no way to run tools, keep the lights on, operate valuable equipment, or do any of the things needed to get the job done. This
26 sentiment rings true for many different types of industries including those in the construction, manufacturing, mining, and even healthcare sectors.
Diesel engine generators have typically been the go-to source for reliable power.
But advances in technology, particularly renewable technology and battery storage, tightening emissions regulations, and growing concerns of the environmental impact have begun to put pressure on the traditional diesel generator. Under these constraints, what is the current outlook and what are the projected forecasts for the industry?
While new and innovative options become available, there is still a great need for traditional diesel generators. Here’s what you need to know about market research trends and analysis in the diesel generator industry.
WHY DIESEL GENERATORS?
The first and most common reason to opt for this type of generator is ease of access. Diesel fuel is an energy source that is fairly costeffective and widely available throughout the world. Other sources aren’t as easy to come by in rural areas where generated power is an important part of operations or in places where infrastructure doesn’t match the need for electrical output. Simply put, diesel generators are the most optimum solution for getting power in certain work environments with limited resources.
Second, diesel generators are reliable. While budget, green credentials and other factors contribute to the choice of generator, the primary objective is that it provides power when needed, and none offer the reliability of diesel generators. The sustained growth of the market may also be attributed to a rise in technology for the industry. Incorporation of resilient engine parts such as hardened valves increases efficiency and performance. This ability to adapt and improve, as we’ll see later, is a key reason why diesel generators are likely to remain popular far into the future.
CURRENT & PREDICTED DIESEL GENERATOR TRENDS
According to a comprehensive report by Grand View Research, published in 2018, the global diesel generator market reached $12.65 billion in 2014 and will reach $21.37 billion by 2022. The demand for power generation continues to outstrip supply.
Globally, low power generators (0-350 kVA) which are commonplace in residential and commercial settings, accounted for
49% of the market. This figure is expected to fall due to rapid global industrialization in the MEA and Asia Pacific regions, which requires heavy-duty generators for use in mining, railway development, construction, and oil and gas applications. These emerging economies don’t yet have the infrastructure and grid to support these operations, particularly in remote areas.
As a result, high powered generators (1,000+ kVA) are expected to see the highest amount of growth.
While its overall share is likely to fall, demand continues to rise in the commercial sector – examples include hospitality and restaurant markets.
There’s also an increased need for power generation in home application including systems that keep appliances and HVAC systems running during poor weather or times of outage. For this purpose, many manufacturers are starting to offer units
designed specifically for smaller grade use.
As previously mentioned, most trends in domestic and global diesel generator use stem from increased industrialization. As industries such as construction, mining, and more continue to grow, so does the increased need for specialized equipment.
In the United States, one industry seeing a jump in the need for reliable generator equipment is telecom. As companies seek to increase tower construction in areas that are farther away from typical power grids— i.e. in mountainous areas and other rural terrains—the need for reliable backup power sources is paramount.
Another industry driving the domestic demand for diesel generators is data centers. As more information moves to networked servers, these hubs of information need to be kept on at all times, even in times of power outages.
Further afield, demand is even greater. In addition to manufacturing and heavy industry, diesel generators are becoming a normal part of building a local commercial or retail space in the Asian Pacific region as businesses strive for power when the local electricity supply fails.
And the drive for diesel generators goes even wider. Developing countries and those
28 who have experienced a major natural disaster are also prime candidates for use of diesel-powered generators.
Cummins, Inc retains the largest market share of diesel generator suppliers. As a well-known leader in a variety of different diesel engine applications, this company continues to develop a variety of different generator models ideal for multiple application types.
Other key players in the diesel generator industry include Generac Power Holdings, Inc., FG Wilson Inc., Himoinsa S.L., Mitsubishi Heavy Industries, Ltd., Neuson, Caterpillar, and Atlas Copco AB.
CONTINUITY & ADAPTATION
The diesel generator industry is thriving and slated to grow over the next ten years. While natural gas (with its falling prices and cleaner energy) and other green initiatives have an effect on sales, the need for reliable portable and backup energy is still paramount.
At the same time, the diesel generator industry is not blind to competing pressures and is responding accordingly. Cleaner and more efficient diesel technology such as exhaust after treatment and engine control systems are already in use.
Integration with battery storage and renewable alternatives – named hybrid systems – are likely to grow as efforts are made to retain the advantages of diesel while offsetting its drawbacks. Read more of our analysis and projections on the future of diesel generators.
WHY NATURAL GAS-POWERED GENERATORS HAVE COME OF AGE
Energy generation via fossil fuels is gradually being challenged as emissions reduction, carbon reduction and environmental drivers become a key factor in power generation. It is also an increasing trend that modular power networks – made up of renewables as well as batteries for storage – will be the future of power generation for society and industry.
The concept is scalable, able to power entire cities, as well as remote off-grid installations, and will have wide reaching implications for the utilities sector.
In the Middle East, the sector is leading the way in investment into renewables, with Saudi Arabia and Dubai both recently announcing plans to build vast solarpowered desalination plants.
So where does the ‘traditional’ fossil fuel powered generator sit in the coming
new age of power? Battery technology is advancing, but for the foreseeable future at least, it is unable to provide necessary power for intensive use demanded by utilities operations.
It is natural gas that is emerging as the ideal fuel source to supplement renewable power networks. Cloud cover or wind changes can suddenly impact the efficiency of renewable energy generation, and for that reason natural gas generators that can respond quickly to maintain voltage, frequency and kW output are a key ingredient to these new power networks.
This emerging market trend has manufacturers racing to develop even cleaner, more efficient and intelligent gas generators.
For that reason, Cummins, launched the HSK78G gas generator series. Designed from the skids up, this generator series will satisfy increasing demand from urban-sites through to heavy-industrial installations, including utilities such as desalination and water-treatment plants.
THE BENEFITS OF GAS POWER
An un-interruptible supply of fuel, clean technology and an excellent total-cost-ofownership, all combine to present clear benefits for gas-power, says Wilkins.
In the context of progressively stringent global emissions standards, modern gaspowered generators, such as the leanburn HSK78G, are cleaner than their diesel counterparts.
Air pollutant outputs are lower, including NOx, hydrocarbons, carbon monoxide and particulate matter, allowing the machine to operate in urban environments with tight emissions regulations.
Lean burn levels for NOx, without aftertreatment, are as low as 250 mg/Nm³ compared to 2500-3000 mg/Nm³ for diesel. Particulate matter levels are also almost zero. This is achieved because lean burn gas generators use twice as much air in the air/fuel mix than is required for total burn, which reduces burn temperature and NOx output.Lean burn levels for NOx, without aftertreatment, are as low as 250 mg/Nm³ compared to 2500-3000 mg/Nm³ for diesel.
Particulate matter levels are also almost zero. This is achieved because lean burn gas generators use twice as much air in the air/ fuel mix than is required for total burn, which reduces burn temperature and NOx output.
Emissions aside, gas-powered generators offer operational advantages for the utilities sector. Having access to a continuous, un-interruptible fuel supply via a gas pipeline is an obvious benefit for use in prime-power or backup power configurations.
It also negates the need to store very large quantities of diesel on-site which require costly efforts to maintain the quality of the fuel. In addition, considering that the typical fuel cost ratio for diesel vs natural gas is 6:1, then some operators can look to achieve a significant Opex saving.