Market Data: Combined Heat and Power in Microgrids

Turbines, Microturbines, Reciprocating Gensets, and Fuel Cells:
Global Market Analysis and Forecasts

Combined heat and power (CHP) systems—which generate electricity and useful thermal energy in a single unit—were the original microgrids. CHP has been operating as an efficient, simple form of self-sustaining microgrid for more than a century. Boasting double the efficiency of typical grid-supplied power, the opportunities for modern CHP’s positive impact are vast. Yet, growth has been stagnant and most applications remain focused on large systems in niche markets.

Demand for CHP in microgrids is subject to a complex mix of drivers and hurdles. CHP is sought after for boosting energy resilience, cutting emissions compared to grid power, and lowering utility bills. On the other hand, project complexity, interconnection challenges, and concerns about long-term emissions on a lower carbon grid are some of the hurdles faced. Industry players that can navigate these shifting forces will be rewarded as demand continues to grow. According to Navigant Research, global demand for CHP prime mover equipment in microgrids is expected to grow from 655 MW in 2017 to 1,906 MW in 2026.

This Navigant Research report examines the global market for CHP in microgrids, aggregating data on five microgrid segments across five regions. The study provides an analysis of the global microgrid market in terms of total annual capacity and revenue attached to five types of CHP prime mover equipment: combustion turbines, steam turbines, microturbines, natural gas reciprocating gensets, and fuel cells. Global market forecasts for capacity and revenue, broken out by segment, technology, and region, extend through 2026. The report also analyzes the key market and technology issues related to CHP in microgrids.

Key Questions Addressed:
  • What are the common and conflicting drivers for combined heat and power (CHP) and microgrids?
  • What new applications exist for CHP in microgrids?
  • How does demand for other microgrid enabling technologies like PV and storage affect demand for CHP in microgrids?
  • Which prime movers will see the most demand for CHP in microgrids from 2017 to 2026?
  • Which regions will see the most demand for CHP in microgrids over the forecast?
  • Which microgrid segments will see the most demand for CHP over the forecast?
Who needs this report?
  • Natural gas generator set (genset) vendors
  • Fuel cell vendors
  • Microturbine vendors
  • Turbine vendors
  • Large industrial power users
  • Energy developers
  • Utilities and grid operators
  • Investor community

Table of Contents

1. Executive Summary

1.1   Overview

1.2   CHP and Microgrids: Shared Drivers

1.3   Significant Hurdles Remain

1.4   Opportunities and Recommendations

1.5   Market Forecast

2. Market Issues

2.1   Combined Heat and Power in 2017

2.1.1   Microgrid Segments

2.2   Market Drivers and Barriers

2.2.1   Improvements in Enabling Technologies

2.2.2   Extreme Weather Events and Demand for Resilient Power

2.2.3   Government Incentives

2.2.4   Renewable Portfolio Standard and Climate Change Regulations

2.2.5   Backfill of Retiring Coal and Nuclear

2.2.6   High Spark Spread

2.2.7   Financing and Ownership Challenges

2.2.8   Interconnection Hurdles

2.2.9   Utilities and CHP

3. Technology Issues

3.1   Technology Overview

3.2   CHP for Flexible Grid Support

3.2.1   Thermal Storage as Grid-Balancing Resource

3.3   Renewable Fuels and CHP

4. Market Forecasts 

4.1   The State of CHP in Microgrids

4.1.1   Resource Mix: CHP Prime Movers

4.1.2   Other DER in CHP Microgrids

4.2   Forecast Assumptions

4.3   Forecasts by Segment and Technology

4.3.1   Institutional/Campus Microgrids

4.3.2   C&I Microgrids

4.3.3   Community Microgrids

4.3.4   Military Microgrids

4.3.5   Other Microgrid Segments

4.4   Forecasts by Region and Segment

4.4.1   North America

4.4.2   Europe

4.4.3   Asia Pacific

4.4.4   Latin America

4.4.5   Middle East & Africa

4.5   Conclusions and Recommendations

5. Acronym and Abbreviation List
6. Table of Contents
7. Table of Charts and Figures
8. Scope of Study, Sources and Methodology, Notes

List of Charts and Figures

  • Combined Heat and Power: Typical Energy Flows
  • CHP Prime Mover Share by Number of Microgrids, World Markets: 2017
  • CHP Prime Mover Share in Microgrids by Capacity, World Markets: 2017
  • Share of Non-CHP DER in CHP Microgrids, World Markets: 2017
  • Annual CHP Equipment Capacity and Revenue by Technology, Institutional/Campus Segment, World Markets: 2017-2026
  • Annual CHP Equipment Capacity and Revenue by Technology, C&I Segment, World Markets: 2017-2026
  • Annual CHP Equipment Capacity and Revenue by Technology, Community Segment, World Markets: 2017-2026
  • Annual CHP Equipment Capacity and Revenue by Technology, Military Segment, World Markets: 2017-2026
  • Annual CHP Equipment Capacity and Revenue by Technology, Other Segments, World Markets: 2017-2026
  • Annual CHP Equipment Capacity and Revenue by Segment, North America: 2017-2026
  • Annual CHP Equipment Capacity and Revenue by Segment, Europe: 2017-2026
  • Annual CHP Equipment Capacity and Revenue by Segment, Asia Pacific: 2017-2026
  • Annual CHP Equipment Capacity and Revenue by Segment, Latin America: 2017-2026
  • Annual CHP Equipment Capacity and Revenue by Segment, Middle East & Africa: 2017-2026
  • Annual CHP Equipment Capacity and Revenue by Region, World Markets: 2017-2026

List of Tables

  • CHP and Microgrids: The Magnitude of Impact of Drivers and Barriers
  • Annual CHP Prime Mover Equipment Capacity Additions by Region, World Markets: 2017-2026
  • Annual CHP Prime Mover Equipment Revenue by Region, World Markets: 2017-2026
  • Annual CHP Equipment Capacity Additions by Prime Mover Technology in Institutional/Campus Microgrids, World Markets: 2017-2026
  • Annual CHP Equipment Revenue by Prime Mover Technology in Institutional/Campus Microgrids, World Markets: 2017-2026
  • Annual CHP Equipment Capacity Additions by Prime Mover Technology in C&I Microgrids, World Markets: 2017-2026
  • Annual CHP Equipment Revenue by Prime Mover Technology in C&I Microgrids, World Markets: 2017-2026
  • Annual CHP Equipment Capacity Additions by Prime Mover Technology in Community Microgrids, World Markets: 2017-2026
  • Annual CHP Equipment Revenue by Prime Mover Technology in Community Microgrids, World Markets: 2017-2026
  • Annual CHP Equipment Capacity Additions by Prime Mover Technology in Military Microgrids, World Markets: 2017-2026
  • Annual CHP Equipment Revenue by Prime Mover Technology in Military Microgrids, World Markets: 2017-2026
  • Annual CHP Equipment Capacity Additions by Prime Mover Technology in Other Microgrid Segments, World Markets: 2017-2026
  • Annual CHP Equipment Revenue by Prime Mover Technology in Other Microgrid Segments, World Markets: 2017-2026
  • Annual CHP Equipment Capacity Additions by Segment, North America: 2017-2026
  • Annual CHP Equipment Revenue by Segment, North America: 2017-2026
  • Annual CHP Equipment Capacity Additions by Segment, Europe: 2017-2026
  • Annual CHP Equipment Revenue by Segment, Europe: 2017-2026
  • Annual CHP Equipment Capacity Additions by Segment, Asia Pacific: 2017-2026
  • Annual CHP Equipment Revenue by Segment, Asia Pacific: 2017-2026
  • Annual CHP Equipment Capacity Additions by Segment, Latin America: 2017-2026
  • Annual CHP Equipment Revenue by Segment, Latin America: 2017-2026
  • Annual CHP Equipment Capacity Additions by Segment, Middle East & Africa: 2017-2026
  • Annual CHP Equipment Revenue by Segment, Middle East & Africa: 2017-2026

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