The global electricity rental market was valued at $ 9.5 billion in 2020 and is expected to reach $ 17.8 billion by 2030, with a CAGR of 6.6% from 2021 to 2030. Electricity refers to the possibility of temporarily renting power stations or generators for the supply of energy to industrial units. It provides functional electrical equipment as well as various upgradeable components, which are installed in power plants. In addition, it provides reliability, flexibility, speed and profitability for businesses to cope with brief power shortages. Electricity rental services aim to stabilize utility power grids and provide additional energy to industries and support communities. Thus, power rental systems find many applications in the construction, mining and oil and gas industries.
The increased consumption of electricity for commercial and industrial applications has widened the gap between supply and demand in the electricity market. This slot is even more evident during peak hours for power consumption. This has propelled the expansion of electric rental systems, which are capable of providing interim electricity in times of low electricity supply. In addition, increasing demand for momentary power supply sources at festivals, events and fairs is expected to drive the market growth in the coming years. In addition, these power systems offer peak clipping, which allows various industries to allocate their electrical load consistently during off-peak and peak hours.
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In addition, these systems act as a back-up power supply in times of unforeseen power losses. Incentives and programs from government authorities, including feed-in tariffs, in Asia Pacific and North America are expected to fuel demand for rental power solutions. The programs introduced by the government aim to approve the installation of such rental systems in industrial, commercial and residential applications. These systems can also be operated off-grid as well as on-grid depending on their location and applications. Several advantages of distributed power generation over conventional sources of power generation are expected to drive the market.
However, the application of strict regulations on emission reduction from fossil fuel powered equipment is expected to hamper the growth of the electricity rental market during the forecast period. On the contrary, the advent of digital technology solutions for improving operations is expected to provide remunerative growth opportunities for the expansion of the electricity rental market during the forecast period.
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By fuel type, the global power rental market size is studied for diesel, natural gas, and others. The diesel fuel segment accounted for the largest market share in 2020, due to its ability to provide weather independent, scalable and flexible operations. In addition, 24-hour power availability and low up-front costs are expected to drive demand for diesel power rental equipment. The diesel fuel segment dominated the global electric rental market with more than four-fifths of the total market share in 2020.
By application, the global electricity rental market is studied in terms of peak clipping, standby power and continuous power. The continuous electricity segment has emerged as the leader in 2020, due to the increasing demand for constant electricity supply from the oil and gas, construction and mining sectors as they are far away from the power grid areas. . The continuous feeding segment dominated the global market with more than two-fifths of the total market share in 2020.
Depending on the region, Asia Pacific, followed by North America, held the largest market share in 2020, accounting for over a third of the global electricity rental market, and is expected to maintain its dominant share by 2030. This is due to the rapid expansion of retail spaces including shopping centers, hotels and retail stores. stores which have led to increased demand for a stable power supply. However, LAMEA is estimated to register the highest CAGR of 7.7% during the forecast period, due to frequent power outages and lack of availability of adequate network infrastructure.
The main market players
- Atlas Copco AB
- United Rentals
- Cummins, Inc.
- Generac Power Systems, Inc.
- Kohler Co.
- Ashtead Group plc.
- Location HERC inc.
- Wacker Neuson SE
Get a detailed analysis of the impact of COVID-19 on the electricity rental market
- Due to the containment measures put in place in various countries, commercial and industrial activities have been interrupted. This resulted in a drop in demand for power rental systems which impacted overall market revenues. Demand has declined from various end-use industries such as oil and gas, mining, construction and manufacturing.
- In addition, the lack of sufficient manpower due to economic uncertainty and migration to origin cities, daily operations in end-use industries have been affected. According to UNIDO statistics, nearly 30.0-70.0% of the pre-COVID-19 workforce has been migrated. This factor has impacted the demand for rental power systems.
- A disrupted supply chain and partial operations in end-use industries have affected the demand for power rental systems. However, demand would recover after the lockdown as daily operations begin at full capacity in end-use industries.