December 7, 2023
Power Rental Market

The Power Rental Market is Estimated To Witness High Growth Owing To Increased Demand from developing economies

The Power Rental Market is estimated to be valued at US$ 6.19 Bn in 2023 and is expected to exhibit a CAGR of 5.6% over the forecast period 2023 to 2030, as highlighted in a new report published by Coherent Market Insights.

Market Overview:
The power rental market comprises portable generators which provide backup power during power outages along with power generators that are used to fulfill large scale power needs in different end user industries such as construction and mining during peak power demands or power outages. Power rental solutions are increasingly being used to meet power needs during periods of increased demand or unplanned power disruption, as they provide reliable power solutions in a cost effective and flexible manner.

Market key trends:
One of the key trends driving growth in the power rental market is the increased demand from developing economies. Power infrastructure in developing countries remains inadequate, leading to frequent power outages. This has boosted demand for power rental solutions that help mitigate effects of power outages and ensure uninterrupted operations. Additionally, ongoing infrastructure development projects coupled with urbanization is increasing demand for power rental solutions to fulfill temporary power needs during the construction phase. Power rental solutions offer a reliable and flexible means to fulfill power needs, thereby witnessing increased adoption.

Porter’s Analysis

Threat of new entrants: The threat of new entrants is low as power rental market requires high capital investment for infrastructure development and fleet acquisition. The market is dominated by few established global players.

Bargaining power of buyers: The bargaining power of buyers is moderate as there are multiple options of power rental suppliers. However, switching cost is high for large power projects.

Bargaining power of suppliers: The bargaining power of suppliers is low as there are many equipment manufacturers and suppliers in the market. Suppliers have less control over pricing.

Threat of new substitutes: Threat of new substitutes is low as power rental offers flexibility and reliability over other power generation options for temporary and emergency needs.

Competitive rivalry: Intense competition exists among the established global players to gain market share.

SWOT Analysis

Strength: Power rental offers standby power solution during planned and unplanned outages. Increasing infrastructure projects and power demand events drive the market.

Weakness: Dependency on fuel prices increases operating costs. Seasonality of demand leads to underutilization of assets at times.

Opportunity: Growth in developing economies power requirements offers expansion opportunities. Rising adoption of hybrid power solutions integrates power rental.

Threats: Stringent emission norms increase compliance costs. Substitution threat from permanent decentralized power generation rises.

Key Takeaways

Global Power Rental Market Size is expected to witness high growth, exhibiting CAGR of 5.6% over the forecast period, due to increasing infrastructure development activities and rising power outages globally. Asia Pacific dominates the market currently due to fast-pace infrastructure growth in China and India. The region is expected to remain the key revenue generator.

Regional analysis – Asia Pacific dominates the global power rental market with over 35% share owing to rising demand from infrastructure, construction and event industry verticals. China, India and Southeast Asian countries are expected to be the fastest growing regional markets.

Key players operating in the power rental market are Aggreko PLC, United Rentals, Inc., APR Energy, PLC, Caterpillar, Inc., Cummins, Inc., Hertz Equipment Rental Corporation, Generac Power Systems, and Rental Solutions & Services, LLC. The key players focus on fleet expansion, digitalization and expansion in high growth markets.

1. Source: Coherent Market Insights, Public sources, Desk research
2. We have leveraged AI tools to mine information and compile it