Energy Transition Market Is Estimated To Witness High Growth Owing To Growing Concerns Regarding Climate Change

  • Ronak Shah
  • U.S.A
  • January 17, 2025

The energy transition market is estimated to be valued at US$ 2.83 Tn in 2024 and is expected to exhibit a CAGR of 9.7% over the forecast period between 2024-2031, as highlighted in a new report published by Coherent Market Insights’ The energy transition market is primarily driven by growing concerns regarding climate change and significant shift towards renewable and clean energy sources. According to International Energy Agency (IEA), global energy-related carbon dioxide emissions rose by 1.7% to reach a historic high of 33.2 Gt in 2021 due to economic recovery from COVID-19 disruptions leading to increased energy demand. However, in the long run energy transition from fossil fuel based conventional sources to renewable sources will play a key role in curbing emissions. Additionally, stringent government regulations regarding carbon emissions and international commitments to reduce emissions under the Paris Agreement are further fueling adoption of green technologies in the energy sector.

Key Market Trends: Deployment of smart grid infrastructure is one of the key trends being witnessed in the energy transition market. Smart grids utilizes digital and electronic technologies to gather and act on information, such as information about the behaviors of suppliers and consumers, in an automated fashion to improve the efficiency, reliability, economics, and sustainability of the production and distribution of electricity. Smart grids helps in better integration of renewable energy sources into the grid and empower consumers through advanced metering infrastructure to manage and monitor their energy consumption. Additionally, growing investments in battery storage technologies is another major trend as battery storage plays a crucial role in effective storage of energy from renewable sources and its usage as per requirement. Residential and industrial sectors are increasingly adopting battery storage solutions to store excess solar or wind energy and use it when needed.

Energy Transition Market Opportunities: The equipment market based on energy source type can be segmented into electric and non-electric. The electric segment accounted for around 65% share of the overall market in 2019 owing to various benefits such as ease of operations and control.

Based on technology, the market is bifurcated into motors & pumps, hoppers & mixers, heat exchangers, bags & pouches, filtration & drying, and others. The motors & pumps segment captured over 30% share of the overall market in 2019 due to wide usage of motors and pumps in equipment for processing of various food products.

Key Market Takeaways: This is anticipated to witness a CAGR of 5.5% during the forecast period 2024-2031, owing to growing demand for packaged food products across the globe. On the basis of energy source type, electric segment is expected to hold a dominant position, accounting for around 70% share by 2031, due to various associated benefits.

By technology, the motors & pumps segment is expected to remain the most lucrative segment over the coming years, attributed to high demand for pumps and motors in food and beverage industries. On the basis of region, North America is expected to hold a dominant position over the forecast period, owing to well-established food processing industries in the region.

Competitor Insights: Key players operating in the food and beverage processing equipment market include Siemens AG., ABB Ltd., GEA Group, Krones AG, SPX Flow Inc., Tetra Laval International S.A., Alfa Laval, John Bean Technologies Corporation, IMA Group, and Marel HF. These players are focusing on new product launches and mergers & acquisitions to strengthen their market position.

Recent Developments: In July 2023, the US Inflation Reduction Act was signed into law, representing the largest climate investment in US history. The new law allocates $370 billion in funding and tax credits to accelerate the clean energy transition. It offers consumers rebates for electric vehicles and home electrification, while providing massive subsidies to deploy more wind and solar projects, transmission lines and battery storage nationwide. Independent analyses project this new policy support could more than double annual US renewable energy installations between 2023-2030. More information in full report.

Summary

TDS NEWS