The European gas turbine market is expected to register a CAGR of more than 2.97% during the forecast period 2020-2025. The gas turbine is an instrument that utilizes the energy stored in gas either in the form of the kinetic energy of the flowing gas stream or the potential energy of a gas under pressure to produce rotary movement. The CO2 emissions from the European power industry reduced by 4%, about 1,018 million metric ton of CO2. Owing to coal plant closures and an increase in carbon price support, over 50% of the shift happened was observed in the United Kingdom. Countries, such as Italy, the Netherlands, Germany, and Greece witnessed significant switch over from coal to gas. Such developments in gas-based power infrastructure are expected to drive the demand for gas turbines in Europe during the forecast period. However, increasing shift toward renewable energy is expected to restrain the growth of the gas turbine market.
Key Highlights
- The biggest shift in the European electricity system was the significant change from coal generation to gas generation. This has considerably reduced coal generation by almost 12% by 2018, thus, increasing the natural gas generation by around 20%. As a result, the CO2 emissions from the European power industry reduced by 4%, about 1,018 million metric ton of CO2.
- Technological advancements in the gas turbine industry coupled with upcoming gas-fired power plants are expected to create an ample opportunities for the market in the near future.
- Europe is projected to witness significant growth in the global industrial gas turbine market, with majority of the demand coming from Germany, Italy, the United Kingdom, etc.
Key Market Trends
Gas-based Power Generation to Drive the market
- The EU power market has made a significant shift away from coal generation, but mainly to the benefit of gas-based power generation. The EU transition to a low-carbon economy, the gas industry will face significant transformations over the next decades up to 2050 and beyond.
- A gas generation grew from 610.9 TWh in 2015 to 731.3 TWh in 2018, thereby, increasing its share in the European electricity mix. This switch from coal to gas is one of the major factors that is expected to propel the European gas turbine market.
- In 2016, around 8 GW coal plants were closed in the European Union. These plants include 4.9 GW in the United Kingdom, 1.6 GW in the Netherlands, 0.6 GW in Italy, 0.6 GW in Belgium, 0.6 GW in Germany, and 0.2 GW in Poland. Also, Europe has announced the closure of an additional 7 GWs of coal power plants during 2017-2020, which represents less than 5% of the total coal fleet in the region.
- Share of gas-fired power generation in Europe grew from 15.5% in 2015 to 20.8% in 2018. This switch from coal to gas is one of the major factors that is expected to propel the European gas turbine market.
Germany to Dominate the Market
- Germany is expected to dominate the gas turbine market in Europe. Germany launches one of Europe’s most modern gas-fired power plants replacing coal-fired power stations, which helps to drive the gas turbine market.
- German municipal utility, Stadtwerke Kiel, launched the most modern and flexible gas engine-based combined heat and power (CHP) plants on the eastern shore of the Kieler Förde inlet in northern Germany.
- Representatives of Stadtwerke Kiel, Kraftanlagen München GmbH (KAM) and INNIO celebrated the launch with a ceremony marking the culmination of a five-year project. Collectively, the 20 Jenbacher J920 FleXtra gas engines provide a total electrical output of 190 megawatts (MW) and a thermal output of 192 MW.
- Around 40GW of Germany’s 40-year-old installed power plant capacity will need to be replaced by 2021. New gas power plants currently being built will primarily replace coal power, which causes much more pollution.
Competitive Landscape
The European gas turbine market industry is moderately consolidated. Some of the key players are General Electric Company, Mitsubishi Hitachi Power Systems Ltd, Siemens AG, Kawasaki Heavy Industries Ltd, and Solar Turbines Europe SA.
Additional Benefits:
- The market estimate (ME) sheet in Excel format
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