Backup power systems are a reliable and cost-effective system used to mitigate the risk of economic loss and societal hardship caused due to power outages. Many businesses suffer industrial injuries due to disruptions of electric power supply during a natural disaster. For companies with highly sensitive loads such as data centers and financial institutions, the risk of economic losses from downtime is high. In addition, various facilities, such as assisted living facilities and nursing homes, life safety aspects are a significant concern. Other facilities, such as cell tower sites, emergency call centers, and gas stations, have a far-reaching social impact, and their availability is critical. Thus, firms are investing heavily in onsite backup power equipment to ensure reliability, safety, and productivity. According to a study published by Insure Insights, the global backup power system market is anticipated to grow at a CAGR of 4.6% during the forecast period.
Top Driver: Massive Demand for Power and Demand for Energy-Efficient Power Backup Systems
With the massive demand for power and rising concerns on energy, security is a leading factor contributing to the growth of power backup systems market growth. Demand for energy-efficient power backup systems is expected to grow owing to increasing energy prices. Moreover, the power backup systems market has high potential in the countries that lag in the supply of power sufficient for fulfilling the demand, especially in developing economies such as China and India. Shortages in coal and gas, which are the fundamental raw materials for power generation, are expected to intensify the scarcity of power supply further. Due to the increasing frequency of power cuts, consumers are inclining towards backup power systems, thus creating lucrative opportunities.
Backup Generator to Make Crucial Contribution to Growth of Market
On the basis of technology, the market is segmented into Backup Generator, Uninterrupted Power Supply (UPS). The backup generator accounted for a major market share owing to the reliability of the generators during emergency especially in the industrial sector. On the basis of end use the market is segmented into Residential, Commercial, Industrial. The industrial segment held the largest market share.
Rising Increasing Need for the Backup Power System to Benefit North America Market
Asia Pacific is anticipated to grow at the fastest rate among the other segments of the backup power market, and is expected to help the industry to boost through the forecast period. The unpredictability of grid power infrastructure in the developing countries of the region has created a growing need for backup power sources. This is anticipated to help the industry flourish in the coming years. The EU is encouraging distributed generation by providing feed in tariffs and incentives, which is expected to drive the installation of off-grid energy systems such as fuel cells and battery energy storage systems.
Players to Focus on Backup Power System Market
The global market is expected to stay fragmented with the increase in the number of new entrants in the coming years. Aggreko, Caterpillar, Cummins, Saft, Trojan Battery, ALCAD, Altaaqa Global, APac Energy Rental, APR Energy, and Atlas Copco among others could be at the forefront of the competition in the global market.
Aggreko: In January 2018, Aggreko had created a power rentals joint venture in China through the acquisition of 21.5% of Shanghai Yude, a company employing 45 people and with a power rental fleet of more than 40 MW. The new joint venture company will trade as Shanghai Yude Aggreko Energy Equipment Rental Co Ltd. The acquisition is part of its long term strategy to expand in China with a local partner.
Generac Power Systems: In October 2019, Generac Power Systems, a market leader in residential backup power systems, has announced its move into Clean Energy. The company will now draw on its technology and extensive engineering expertise to offer a complete ecosystem of new energy storage and management products.
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