Power Generation Market Report 2026

The power generation market size has grown strongly in recent years. It will grow from $2.11 trillion in 2025 to $2.22 trillion in 2026 at a compound annual growth rate (CAGR) of 5.2%. The growth in the historic period can be attributed to expansion of global electricity demand, increased investment in fossil fuel power infrastructure, development of national power grids, growth of industrial electricity consumption, long-term operation of centralized power plants.

The power generation market size is expected to see strong growth in the next few years. It will grow to $2.79 trillion in 2030 at a compound annual growth rate (CAGR) of 5.8%. The growth in the forecast period can be attributed to increasing renewable energy penetration targets, rising electrification of transportation and industry, expansion of smart grid infrastructure, growing focus on energy security, continued modernization of aging power plants. Major trends in the forecast period include increasing deployment of renewable power generation assets, rising integration of grid-scale energy storage systems, expansion of hybrid power generation plants, growing adoption of distributed generation models, enhanced focus on grid reliability and stability.

The growing use of electricity in the transportation sector is expected to drive the expansion of the power generation market in the coming years. Electricity usage in transportation refers to the adoption of electric power for mobility solutions such as electric vehicles, electrified railways, and mass transit systems, which reduces reliance on fossil fuels and improves energy efficiency. The rise in electricity applications in transportation is fueled by rapid urbanization, government initiatives aimed at reducing carbon emissions, and increasing investments in public transportation infrastructure and electric mobility solutions. Power generation supports this sector by providing a reliable and scalable supply of electricity to operate electrified transport networks and charging infrastructure. For instance, in July 2024, according to the International Energy Agency (IEA), a France-based intergovernmental organization, the share of global electricity supply is projected to rise from 30% in 2023 to 35% by 2025. Therefore, the increasing adoption of electricity in transportation is driving the growth of the power generation market.

The growing demand for cooling is expected to drive the expansion of the power generation market in the coming years. Cooling refers to the process of reducing indoor or environmental temperatures using systems such as air conditioners and fans, which rely on electricity for efficient operation. The increase in cooling demand is driven by rising global temperatures, urbanization, and improved living standards, leading to higher adoption of air conditioning across residential and commercial sectors. Power generation supports these cooling needs by supplying the electricity required to operate cooling systems and maintain thermal comfort. For instance, in July 2023, according to the International Energy Agency, a France-based intergovernmental organization, over 90% of households in both the United States and Japan owned an air conditioner, and cooling accounted for approximately 10% of global electricity consumption, with power demand in warmer countries surging by more than 50% during summer months. Therefore, the rising demand for cooling is fueling the growth of the power generation market.

Major companies in the power generation market are focusing on innovative solutions to enhance the use of hydrogen fuel cells for backup power and to gain a competitive advantage. Hydrogen fuel cells represent a modern and efficient solution for backup power, providing a reliable and decentralized electricity source during outages or emergencies. For example, in April 2024, Panasonic Corporation announced that its Electric Works Company plans to launch a new pure hydrogen fuel cell generator in October 2024. This generator will generate electricity through a chemical reaction between high-purity hydrogen and oxygen from the air, targeting markets in Australia, Europe, and China.

Major companies operating in the power generation market are Enel SpA, Electricite De France SA, State Power Investment Corporation, E.ON SE, Engie, Huaneng Power International Inc, Exelon Corp, Endesa SA, Datang International Power Generation Company Limited, Inter RAO UES, NTPC Limited, Tata Power, Adani Power, NHPC Limited, Guodian Corporation, Hokkaido Electric Power Company, Tohoku Electric Power Co, AGL Energy, EDF Energy, RWE.

Asia-Pacific was the largest region in the power generation market in 2025. Western Europe was the second-largest region in the power generation market. The regions covered in the power generation market report are Asia-Pacific, South East Asia, Western Europe, Eastern Europe, North America, South America, Middle East, Africa. The countries covered in the power generation market report are China, India, Japan, Australia, Indonesia, South Korea, Bangladesh, Thailand, Vietnam, Malaysia, Singapore, Philippines, Hong Kong, Taiwan, New Zealand, UK, Germany, France, Italy, Spain, Austria, Belgium, Denmark, Finland, Ireland, Netherlands, Norway, Portugal, Sweden, Switzerland, Russia, Czech Republic, Poland, Romania, Ukraine, USA, Canada, Mexico, Brazil, Chile, Argentina, Colombia, Peru, Saudi Arabia, Israel, Iran, Turkey, UAE, Egypt, Nigeria, South Africa.

The power generation market includes revenue earned by entities by thermal energy generated from fossil fuels, coal, petroleum, natural gas, solar thermal energy, chemical energy, and potential energy from falling water. The market value includes the value of related goods sold by the service provider or included within the service offering. Only goods and services traded between entities or sold to end consumers are included.

The market value is defined as the revenues that enterprises gain from the sale of goods and/or services within the specified market and geography through sales, grants, or donations in terms of the currency (in USD unless otherwise specified).

The revenues for a specified geography are consumption values that are revenues generated by organizations in the specified geography within the market, irrespective of where they are produced. It does not include revenues from resales along the supply chain, either further along the supply chain or as part of other products.

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