Microgrid Market Forecasts to 2028 – Global Analysis By Connectivity (Grid Connected and Off Grid), Grid Type (Hybrid, AC Microgrid and DC Microgrid), Power Source, Pattern, Storage Device, Application and By Geography

Microgrid Market Forecasts to 2028 – Global Analysis By Connectivity (Grid Connected and Off Grid), Grid Type (Hybrid, AC Microgrid and DC Microgrid), Power Source, Pattern, Storage Device, Application and By Geography

According to Stratistics MRC, the Global Microgrid Market is accounted for $8.93 billion in 2022 and is expected to reach $20.89 billion by 2028 growing at a CAGR of 15.21% during the forecast period. A microgrid is an energy system with connected loads and scattered energy supplies that functions either simultaneously with or independently from the main power grid. It mainly consists of fuel cells, battery storage systems, wind turbine generators, micro turbines, and solar generators to transport electricity from producers to consumers. It increases the reliability and resilience of the electric grid, improves its efficiency and stability, and reduces peak loads, fuel consumption, and congestion. As microgrids are more effective than traditional electrical networks, they may be connected to a range of renewable energy sources, such as solar, small hydro, wind, waste-to-energy, geothermal, and combined heat and power systems.

According to the US Department of Energy, as of 2021, the off-grid microgrid installed capacity was around 4225 MW (4.2GW). By 2040, its energy consumption is predicted to rise by over 56%.

Market Dynamics

Driver:

Rising usage for rural electricity

The use of microgrids is spreading around the world. They are employed in the creation of resilient networks in grid-connected assets, the remote electrification of remote installations, the support of regional energy communities, and local energy communities. 87% of the population lives in rural or remote areas. Small-scale microgrids may be built, and can offer electricity at a lower cost than conventional grids. This factor can quicken the market's growth.

Restraint

Instability during oversupply

Microgrid’s ability to operate in an isolated mode presents one of their biggest operational problems. Microgrids must maintain stability while operating with the aid of dispersed energy supplies. Both periods of excess and deficiency in the supply of power can cause instability in microgrids. This may result in the tripping off of a generator and cutting off the microgrid's power source which is hampering the market demand.

Opportunity

Growing government interference

The market for microgrids for rural electrification is being impacted by the escalating government support and surge in microgrid project execution. Governments from several nations are increasingly funding microgrid initiatives. Several companies may benefit from a dependable, effective power supply owing to microgrid technology, which is also becoming more and more affordable. These government initiatives are predicted to provide development opportunities for the market throughout the projected period.

Threat

High cost and operational challenges

Microgrid is employed instead of a standard grid, there will be significant installation costs. Microgrids cannot function well without the inclusion of system engineers, monitoring systems, and relays. Microgrids are more expensive than traditional networks because they have the capacity to store, transform, and recycle energy as well as provide higher levels of dependability and power quality. The demand on the market is being hampered by this factor.

Covid-19 Impact

The significant impact of COVID-19 was seen on the expansion of the microgrid market as a result of the disruption of the raw material supply chain and the stifling of activity brought on by socially alienating standards. The market has experienced a decline in revenue as a result of a number of additional causes, including a shortage of qualified personnel to run the technology and the closure of production facilities throughout the globe. Major associations such as SEIA, AEE, ARE and ILSR are taking actions to put microgrid projects back on rails.

The grid connected segment is expected to be the largest during the forecast period

The grid connected segment is estimated to have a lucrative growth, due to its grid resiliency and power quality. Microgrids that are connected to the grid are constructed using a number of generators, distribution networks, and sophisticated controllers. Numerous advantages are provided by these technologies. Furthermore, it reduces the environmental impact that is fueling the segment's development.

The hybrid segment is expected to have the highest CAGR during the forecast period

The hybrid segment is anticipated to witness the fastest CAGR growth during the forecast period, due to its continuous technology developments. The end-user need for dependable power supply and the continued introduction of effective and optimized energy storage technologies are both factors contributing to the growth of the hybrid market. The dynamics of the industry will be positively impacted by ongoing technological advancements for effective remote energy management.

Region with largest share

North America is projected to hold the largest market share during the forecast period owing to the presence of multiple microgrid companies and government programs. As resiliency options, several fossil-fuelled commercial and industrial (C&I) microgrids are being constructed in North America. The growth in population and electricity usage has also increased the need for energy in this region.

Region with highest CAGR

Asia Pacific is projected to have the highest CAGR over the forecast period, owing to its high power demand. The low electrification rate, inadequate grid connectivity, and high demand for power in the area are its main contributors. Governments in Asia-Pacific nations intend to support distributed energy generation and microgrids in order to provide electricity to their citizens. In addition, it is anticipated that rapid urbanization and industrialisation in China and India would greatly increase market demand.

Key players in the market

Some of the key players profiled in the Microgrid Market include ABB Ltd, Honeywell International Inc, Toshiba Corporation, Ameresco Inc, S&C Electric Company, ZBB Energy Corporation, GE Digital Energy, Chevron Energy, HOMER Energy LLC, Viridity Energy Inc, Lockheed Martin Corporation, Siemens AG, Microgrid Energy LLC, Power Analytics Corporation, Hitachi Ltd, Schneider Electric SE, Eaton Corporation Plc, Caterpillar Inc, Exelon Corporation and Cummins Inc.

Key Developments

In May 2022, Siemens Smart Infrastructure has announced an open, modular grid software suite to support energy stakeholders and enable them to be fast, agile and flexible when coping with existing and future challenges.

In January 2022, Ameresco Inc. announced that it had been awarded a microgrid project in Prince Edward Island, Canada. The ""Slemon Park Microgrid Project"" will be developed by the joint effort of Ameresco and Prince Edward Island Energy Corporation. The project is expected to be completed by the end of 2022. It consists of a 10 MW solar facility with DC-coupled energy storage, and both of them will share the same interconnection.

In November 2021, Hitachi Energy has today launched the next generation of its e-mesh portfolio of energy storage and digital automation solutions. e-meshTM battery energy storage and digital solutions are engineered for fast, modular execution and high renewable penetration.

Connectivities Covered:
• Grid Connected
• Off Grid

Grid Types Covered:
• Hybrid
• AC Microgrid
• DC Microgrid

Power Sources Covered:
• Natural Gas
• Diesel Generators
• Combined Heat & Power
• Solar PV
• Fuel Cell
• Other Power Sources

Patterns Covered:
• Urban/Metropolitan
• Semi Urban
• Rural/Island

Storage Devices Covered:
• Lead Acid
• Lithium-ion
• Flywheels
• Flow Battery
• Other Storage Devices

Applications Covered:
• Educational institutes
• Healthcare
• Utility
• Military
• Industrial/commercial
• Remote Areas
• Government
• Other Applications

Regions Covered:
• North America
US
Canada
Mexico
• Europe
Germany
UK
Italy
France
Spain
Rest of Europe
• Asia Pacific
Japan
China
India
Australia
New Zealand
South Korea
Rest of Asia Pacific
• South America
Argentina
Brazil
Chile
Rest of South America
• Middle East & Africa
Saudi Arabia
UAE
Qatar
South Africa
Rest of Middle East & Africa

What our report offers:
- Market share assessments for the regional and country-level segments
- Strategic recommendations for the new entrants
- Covers Market data for the years 2020, 2021, 2022, 2025, and 2028
- Market Trends (Drivers, Constraints, Opportunities, Threats, Challenges, Investment Opportunities, and recommendations)
- Strategic recommendations in key business segments based on the market estimations
- Competitive landscaping mapping the key common trends
- Company profiling with detailed strategies, financials, and recent developments
- Supply chain trends mapping the latest technological advancements