The market for commercial combined heat and power (comCHP) is expected to reach more than $14 billion by 2024, according to a new report from Navigant Research. An anticipated expansion of the building stock in Asia Pacific, particularly in countries with rapidly urbanizing populations such as China, will lead to continued market expansion.
ComCHP systems, sometimes referred to as cogeneration systems, are are gaining increased traction as a flexible plug-and-play solution, delivering a range of benefits to the grid, end users and governments. As a result, they are garnering increased interest from policymakers, utilities and building owners in a growing number of countries. Although it represents a smaller portion of installed CHP globally than industrial applications, comCHP has shown steady growth in developed economies across North America, Europe and Asia Pacific.
Annual revenue for comCHP in 2015 is expected to be nearly $3.5 billion, and installed global production capacity is expected to be almost 33 GW. The United States, Europe and Asia Pacific accounted for 97 percent of global installations in 2014. Although hospitals and institutional buildings such as universities represent the largest installed base among application groups, small and large commercial buildings are expected to gain an increasing share of the market over the next decade.
Europe is currently the leading market for comCHP, but North America is not far behind. A trend toward smaller average installations is expected in both markets as the economic benefits of installing CHP become more accessible due to improved standardization and better integration with building automation tools. Improved access to biogas resources and lower natural gas prices are also expected to drive growth across North America. Asia Pacific is expected to remain the hottest market for comCHP throughout the forecast period. Collectively, these three regions are expected to represent 91 percent of the 74.4 GW of installed capacity worldwide in 2024 and $12.7 billion in annual revenue.