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The microgrid market size is forecast to increase by USD 32.85 billion, at a CAGR of 15.12% between 2023 and 2028. The expansion of the remote microgrid market hinges on various factors such as the imperative for resilience, increasing uptake of microgrids in rural regions, and recent advancements in microgrid technologies. These factors collectively drive the demand for remote microgrid solutions, catering to areas where traditional grid infrastructure may be lacking or unreliable.
As the importance of energy reliability and sustainability grows, remote microgrids emerge as essential solutions to meet the evolving energy needs of remote and off-grid communities. It also includes an in-depth analysis of market trends and analysis, market growth analysis and challenges. Furthermore, the microgrid market report includes historic market data from 2018 - 2022.
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The microgrid market is pivotal in transforming the energy landscape by integrating remote central station power plants and dispersed energy resources like solar energy, wind turbine generators, and fuel cells. These systems enhance electricity supply resilience by linking loads to the main power grid or operating independently during grid disruptions. Battery storage systems and microturbines play crucial roles in stabilizing electrical networks and managing peak loads efficiently. Microgrids employ diverse topologies including smart microgrids and hybrid microgrid networks, optimizing solar PV and other micro-sources for maximum efficiency and reduced greenhouse gas (GHG) emissions. They enhance grid reliability and flexibility, supporting sustainable energy initiatives while adapting to local energy needs. As the demand for decentralized energy solutions grows, microgrid technologies, including Microgrid as a Service, continue to innovate, offering scalable and resilient energy solutions that contribute to a more sustainable and secure energy future.
The need for resilience is notably driving the remote microgrid market growth. Aging infrastructure, climate change, rising energy costs, and mass electrification are some of the major problems in the power industry. These problems are common across the globe in any energy industry and occur at different levels. Developed countries have well-developed power infrastructure that faces outages due to aging infrastructure, whereas developing countries such as Asia and Africa suffer from low electrification rates. Traditional grids follow a hierarchical power structure, where power is generated at a central location and are then sent through the transmission line to substations, distribution lines, and finally to the end-users. Any problem in one part of the system tends to have a domino effect on the rest of the system, thereby affecting the reliability of the grid. Therefore, the need to overcome the challenges faced by traditional grids has driven the need for microgrids.
Moreover, the use of renewable sources along with energy storage systems makes microgrids self-sufficient and allows them to generate power as long as the sun is shining and the wind is blowing. The entire network can be managed by an energy management system. Microgrids can be grid-connected to supply power blended with their own source or can operate independently of the grid. They provide electricity backup and offer ancillary services to the main grid at times of power outages. Such factors are expected to drive the growth of the global remote market during the forecast period.
Microgrids for protection from cybersecurity attacks are a major trend in the market. Cybersecurity is one of the emerging threats facing the world, and the transition from a traditional grid to a smart grid has made power grids more susceptible to cyberattacks. Smart grids depend on SCADA for monitoring and controlling the physical infrastructure. SCADA systems are highly vulnerable to cyber-attacks, which allow adversaries to compromise the functionality of the grid by introducing malware into the systems. This mismanagement can cause damage to the equipment, in turn leading to heavy losses.
Moreover, microgrids require energy storage systems to make them function even when local resources are not available. In the event of any disturbance, such as a cyber-attack in the grid, a microgrid can isolate itself and function indefinitely if it has access to the sun and wind, thereby allowing it to generate and store electricity during the day so that it can be supplied when power generation is not possible. Another benefit of using microgrids is that they can supply local power to individual households and small villages. As microgrids have a limited reach, the range/impact of the damage caused is less, in turn making them less prone to attackers. Such factors are expected to drive the growth of the market during the forecast period.
High implementation costs are a major challenge impeding the microgrid market growth. The generation of power from microgrids is a tedious and expensive process as it involves the use of new and advanced technologies. Microgrids involve a wide array of equipment related to power generation resources, distribution infrastructure, and control systems. These components can be classified into infrastructure, generation, and controls and need to be connected and monitored with advanced control and communications technologies. A microgrid is built according to the needs of various dynamic load types and is capable of operating under varying grid conditions. However, most of the microgrids are usually built upon existing infrastructure and are custom fitted with the equipment to meet customer needs. Therefore, there is no fixed cost for microgrids.
Further, in the US, for microgrids to interact with the local utility distribution grids, it is highly desirable that they meet mandatory standards such as IEEE 1547 standards. This is crucial to the control system of microgrids as they need to interface with local utility systems such as energy management systems (EMS), distribution management systems (DMS), and supervisory control and data acquisition (SCADA) systems to ensure that both the systems work reliably and efficiently. The high cost of microgrid components is expected to become a major barrier to the growth of the market during the forecast period.
The microgrid market forecasting report includes the adoption lifecycle of the market, covering from the innovator’s stage to the laggard’s stage. It focuses on adoption rates in different regions based on penetration. Furthermore, the microgrid market industry report also includes key purchase criteria and drivers of price sensitivity to help companies evaluate and develop their market growth and forecasting strategies.
Market Customer Landscape
Companies are implementing various strategies, such as strategic alliances, partnerships, mergers and acquisitions, geographical expansion, and product/service launches, to enhance their presence in the market.
The microgrid market research report also includes detailed analyses of the competitive landscape of the market and information about 20 market companies, including:
Qualitative and quantitative analysis of companies has been conducted to help clients understand the wider business environment as well as the strengths and weaknesses of key market players. Data is qualitatively analyzed to categorize companies as pure play, category-focused, industry-focused, and diversified; it is quantitatively analyzed to categorize companies as dominant, leading, strong, tentative, and weak.
The market share growth by the remote segment will be significant during the forecast period. Remote microgrids have found applications mostly in villages where grid-connected power is not accessible or is available only for a limited period. India, Indonesia, and several countries in Africa and Southeast Asia are the prospective markets for remote microgrids.
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The remote segment showed a gradual increase in the market share of USD 8.51 billion in 2018. Generally, remote microgrids are not connected to grids and employ standalone power sources, such as diesel generators and solar and wind energy sources, to meet the entire power load requirements. Energy storage systems are also deployed to store the excess power generated from solar and wind resources, which allows the production of clean and low-cost electricity as long as there is sufficient solar irradiation and wind speed, thus ensuring a continuous and reliable power supply. Remote microgrids are capable of offering ancillary services, such as frequency and load regulation, which are beneficial for utilities by increasing the share of renewable energy sources in the grid. This is expected to drive the adoption of the market during the forecast period.
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North America is estimated to contribute 28% to the growth of the global market during the forecast period. Technavio’s analysts have elaborately explained the regional trends and drivers that shape the market during the forecast period. Increased initiatives from the US government for implementing energy-efficient power solutions are driving market growth in the region. The US government offers to fund technologies that help in improving the resiliency of power systems. Rapid advances in the energy sector have propelled the adoption of microgrids in the region. The region is expected to remain the leading revenue contributor to the market during the forecast period. Remote systems and the military are the two major sections contributing to the growth of microgrids in the region.
In addition, microgrids are mostly powered by fossil fuels. However, the share of renewable energy resources is expected to grow significantly as large utilities must comply with state-specific mandates to diversify the use of renewables under the Renewable Portfolio Standards (RPS). In the US, 33 states have implemented their own mandates for RPS. Therefore, power utilities can meet these RPS mandates using microgrids that have renewable power generation capabilities.
The microgrid market analysis report provides comprehensive data (region-wise segment analysis), with forecasts and estimates in "USD billion" for the period 2024-2028, as well as historical data from 2018 - 2022 for the following segments.
The microgrid market is at the forefront of revolutionizing energy distribution by integrating renewable resources like solar panels, wind turbines, and organic solar PV modules with traditional and advanced technologies such as fuel cells, Combined Heat and Power (CHP), and hydraulic fracturing technology. These microgrids enhance electric system resilience and reliability, crucial for critical infrastructure like data centers, healthcare facilities, and defense bases. They mitigate grid instability and reduce carbon footprint by optimizing energy efficiency and leveraging distributed energy resources.
Further, microgrids play a pivotal role in urbanization and rural electrification projects, offering resilient networks and low-emission power supply solutions. With sophisticated controllers and monitoring systems, they ensure power quality and enable remote energy management, supporting grid resiliency and enhancing energy security. As microgrid technology advances, it continues to drive infrastructure development and sustainable energy solutions globally. Crete explores innovative microgrid topologies within its electric grid infrastructure, integrating regional and hybrid networks with solar generators and hydrogen-linked loads to enhance energy efficiency and reliability.
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Market Scope |
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Report Coverage |
Details |
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Base year |
2023 |
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Historic period |
2018 - 2022 |
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Forecast period |
2024-2028 |
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Growth momentum & CAGR |
Accelerate at a CAGR of 15.12% |
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Market Growth 2024-2028 |
USD 32.85 billion |
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Market structure |
Fragmented |
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YoY growth 2023-2024(%) |
12.81 |
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Regional analysis |
North America, APAC, Europe, South America, and Middle East and Africa |
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Performing market contribution |
North America at 28% |
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Key countries |
US, China, Russia, Germany, and Australia |
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Competitive landscape |
Leading Companies, Market Positioning of Companies, Competitive Strategies, and Industry Risks |
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Key companies profiled |
ABB Ltd., Anbaric Development Partners LLC, Canopy Power, Eaton Corp. Plc, Emerson Electric Co., Exelon Corp., General Electric Co., General MicroGrids, Gram Power (India) Pvt. Ltd., Honeywell International Inc., Pareto Energy, Power Analytics Global Corp., Powerhive Inc., S and C Electric Co., Schneider Electric SE, Siemens AG, Spirae LLC, Tesla Inc., TotalEnergies SE, and UL Solutions Inc. |
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Market dynamics |
Parent market analysis, Microgrid market forecast, Microgrid market growth inducers and obstacles, Fast-growing and slow-growing segment analysis, COVID-19 impact and recovery analysis and future consumer dynamics, Microgrid market worth and condition analysis for the forecast period. |
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Customization purview |
If our microgrid market trends report has not included the data that you are looking for, you can reach out to our analysts and get segments customized. |
We can help! Our analysts can customize this market research report to meet your requirements.
1 Executive Summary
2 Market Landscape
3 Market Sizing
4 Historic Market Size
5 Five Forces Analysis
6 Market Segmentation by Application
7 Market Segmentation by Connectivity
8 Customer Landscape
9 Geographic Landscape
10 Drivers, Challenges, and Opportunity/Restraints
11 Competitive Landscape
12 Competitive Analysis
13 Appendix
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