Expanding Generator Sets Market Predicted to Reach 8.3% Annual Growth Rate until 2034
The generator sets market is set for significant growth from 2025 to 2034, with a particular focus on the Asia-Pacific (APAC) region. This expansion is driven by increasing industrialization, digital transformation, and regulatory push for cleaner backup power solutions.
Cummins Inc. has recently launched the Cummins PowerSuite, a digital platform for real-time generator monitoring. Meanwhile, General Electric (GE) has developed a 7F.05 gas turbine that supports hydrogen blending for cleaner power generation. These developments underscore the industry's commitment to innovation and sustainability.
The market growth is expected to be robust across various fuel-specific segments, such as natural gas and diesel. The Distributed Natural Gas Fueled Generation Market is forecasted to reach USD 66.1 billion by 2034, growing at a CAGR of 9.4% from 2025 to 2034. The Diesel Prime Power Generators Market is expected to grow from USD 15.8 billion in 2025 to USD 32.6 billion by 2035 at a CAGR of 7.5%.
APAC is a critical growth driver, with the region accounting for USD 15.76 billion of the global generator sets market in 2024, representing a 44.8% share. The Asia-Pacific market for hydrotreated vegetable oil (HVO) as a backup fuel for data centers is projected to grow at a compound annual growth rate (CAGR) of 10.17%, increasing from $112.1 thousand in 2024 to $359.5 thousand by 2034. This trend exemplifies APAC’s shift towards low-carbon, sustainable fuels in generator applications.
Power rating segments from small (≤ 50 kVA) to large (above 1,000 kVA and modular turbines) will expand, supporting diverse applications in commercial, industrial, and digital infrastructure sectors. The >50 kVA - 125 kVA segment dominated the market, capturing more than a 31.2% share in 2024.
Fuel-wise, natural gas gensets represent a fast-growing segment due to cleaner emissions and suitability for distributed generation. Diesel remains dominant, particularly for prime power and remote/off-grid applications, with a 7.5% CAGR projected for diesel prime power generators by 2035. Emerging fuels like hydrotreated vegetable oil (HVO), particularly in APAC data centers, show high growth potential as sustainable alternatives.
Key players in the market are innovating to meet these demands. For instance, Generac Holdings Inc. is focusing on microgrid solutions, while Caterpillar Inc. has introduced Cat XQP diesel generator sets with enhanced load management and remote monitoring capabilities. Caterpillar Inc. has also unveiled hydrogen-ready generators for future fuel flexibility. General Electric (GE) has introduced LV5+ diesel gensets with IoT-enabled predictive maintenance via GE Digital's Asset Performance Management.
The commercial sector dominated the market in 2024, accounting for a 54.7% share. The market grew from USD 35.2 billion in 2024 at a CAGR of 8.3% during the 2025-2034 forecast period. The Generator Sets Market is projected to reach USD 78.1 billion by 2034.
In India, industrial captive generation accounts for approximately 75,000 MW of diesel capacity as of FY 2023-24. The 'ADEETIE' scheme, launched by the Union Ministry of Power with ₹1,000 crore in funding, supports MSMEs in adopting energy-efficient technologies. The Deen Dayal Upadhyaya Gram Jyoti Yojana (DDUGJY) achieved nearly 100% village electrification.
In conclusion, the Generator Sets Market from 2025 to 2034 will witness robust growth globally, with the Asia-Pacific region playing a pivotal role largely due to infrastructure growth and environmental regulations encouraging cleaner fuels like natural gas and HVO. This forecast is supported by multiple market reports indicating CAGRs between 4.9% and 10.17% across different segments and fuel types.
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