Malaysia’s gas turbine market has experienced consistent growth, primarily driven by the increasing demand for electricity and the government's commitment to enhancing energy infrastructure. The country’s reliance on natural gas as a primary energy source has made gas turbines a crucial component of its power generation mix. Gas turbines offer advantages such as high efficiency, reliability, and lower emissions, making them a preferred choice for electricity generation in Malaysia. As the nation continues to urbanize and industrialize, the demand for power generation capacity continues to rise, pushing the gas turbine market forward.
Malaysia’s efforts to increase the share of renewable energy in its power generation mix have also influenced the gas turbine market. Gas turbines are often used in combined-cycle power plants, which are more flexible and efficient, complementing the integration of intermittent renewable energy sources like solar and wind. Key market players like Siemens and General Electric are providing cutting-edge gas turbine technologies in Malaysia to improve energy efficiency and reduce environmental impacts. The government’s initiatives, such as the National Energy Policy, which aims to ensure energy security and environmental sustainability, are likely to further propel the growth of the gas turbine market in the country.
The global gas turbine market is expected to grow from USD 14.44 billion in 2022 to USD 26.81 billion by 2030, at a CAGR of 6.42%.
The growth of the market is attributed to increasing demand for electricity, rising investments in the power sector, and growing adoption of gas turbines in the oil and gas industry.
The gas turbine market is segmented based on type, application, and end-user. By type, the market is divided into aeroderivative gas turbines and heavy-duty gas turbines. By application, the market is classified into power generation, oil and gas, and other applications. By end-user, the market is segmented into independent power producers (IPPs), utilities, and oil and gas companies.
A gas turbine is a combustion engine that transforms natural gas or other liquids into mechanical energy.
This energy then fuels the generator that generates electrical energy. Gas turbines have various benefits, such as high power to weight ratio, low operating pressure, and lower than most reciprocating engines of the same power rating. Turbines play an important part in the reduction of carbon emissions.
Compared to other combustion-based power generation applications, they show lower emissions. Global electricity demand is anticipated to rise by almost one-third of current demand in the coming years. Major gas-producing regions, like the Middle East, the U.S., and Russia, are experiencing a major revamp in their electricity generation infrastructure to actively pursue gas-based power generation.
These changes will boost the market for gas turbines along with the need to minimize carbon emissions.
The availability of large quantities of natural gas, combined with relatively lower prices, in particular in North America, Thailand, and China, has led to a rise in power generation using a gas turbine. For example, as per EIA, natural gas demand and supply averaged 93.4 billion cubic feet per day in the first half of 2018, which is 12% higher than demand in the first half of 2017.
The global gas turbine industry is expected to rise at a high rate during the forecast period, mainly due to the strict emission requirements for gas turbine and shale gas production boom. According to EIA, the rapid pace of technological progress in the oil and gas sector will result in an increase in growing per well recoveries and an increase in the production of shale gas.
As stated by EIA, the share of natural gas will increase from 34% in 2018 to 39% by 2050 due to growth in drilling activities. Thus, the rise in the production of natural gas would put downward pressure on the prices of natural gas, which would lead to an increase in the share of electricity produced by natural gas. This is expected to spur the market growth of gas turbines globally.
Competitive Landscape
Ongoing mergers and acquisitions, together with rising R&D spending in product durability, efficiency, and versatility by major manufacturers, will complement the industry's scenario.
COVID -19 Impact on the Gas Turbine Market
The industry is predicted to experience a mild downturn due to the worldwide outbreak of a new coronavirus pandemic. Manufacturing activities are at a standstill due to labor shortages. This has contributed to a major decline in demand from the end-use industries.
Market Segmentation
The global gas turbine market has been segmented based on capacity, technology, and application.
Based on capacity, the global gas turbine market has been segmented into up to 200 MW and above 200 MW.
Based on technology, the global gas turbine market has been segmented into open cycle and combined cycle. The open cycle segment is propelled by factors such as lower warm-up time, lightweight, compact size, operational versatility, quick start, and less dependency on cooling water.
Based on application, the global gas turbine market has been segmented into power generation, industrial, and aviation. Power generation is estimated to be the largest market during the forecast period due to growing energy demand coupled with positive regulatory towards the integration of sustainable energy infrastructure.
Regional Analysis
Region-wise, the global gas turbine market has been segmented into Europe, North America, Asia Pacific, and the rest of the world.
APAC to lead the global market
The Asia Pacific region is the largest gas turbine market. Rapid industrialization, urbanization, and strong economic growth in countries such as India and China will drive the gas turbine industry.
Summary
The global Gas turbine engines market is expected to register a 4.80% CAGR from 2016 to 2023 (forecast period). Global electricity demand is increasing and has doubled over the last two decades. It is expected to rise at twice the rate of energy demand as a whole over the next 25 years. Moreover, the development of technology leading to an increase in the production of shale gas, along with the proposals of various countries to phase out coal-based power generation and substitute it with a gas-fired power plant, is likely to serve as a driver for the market.
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