What’s Halting the Growth of the Global Gas Turbine Market?
The electricity and power required to run a household, industry or perform day to day task are possible due to the conversion of kinetic or thermal energy to electricity which is possible due to turbines. Various kind of turbines including water turbine, steam turbine, wind turbine, and gas turbine can be used for electricity generation. […]READ MORE >>
The electricity and power required to run a household, industry or perform day to day task are possible due to the conversion of kinetic or thermal energy to electricity which is possible due to turbines. Various kind of turbines including water turbine, steam turbine, wind turbine, and gas turbine can be used for electricity generation. Of all the available types of turbine, the gas turbine is the most versatile as different kind of fuels can be used to produce gas to produce torque and thrust. Due to its versatility and efficiency, they are widely used in military fighter aircraft and turboprop engines. The procurement market intelligence report from SpendEdge for the global gas turbine market attributes the growth of the market to increasing government investment to implement gas turbines. The governments of numerous countries are eager to increase investment in gas turbines to ensure environmental protection and improve sustainability. However, players in the global gas turbine market are facing challenges in order to capture market share in this growing sector.
Increasing adoption of renewable resources
The increasing stringency of environmental regulations across the globe and reduced cost of solar and wind energy installations are driving buyers to invest in renewable energy sources. The challenge for the gas turbine manufacturers is only aggravated by the fact that governments worldwide are providing subsidies to encourage the use of renewables sources of energy. As a result, investments in the wind and solar power plants are continuously on the rise. Additionally, the energy generated by solar and wind power plants can be stored in power storage devices which can provide backup power during disruptions to ensure intermittent supply. The inability of gas turbines to produce energy which can be stored for future use is negatively impacting the global gas turbine market.
High cost of procuring gas turbines
The average cost of gas turbines comes up to around US$1,000 per kW of power generated. The buyers also have to spend a significant amount of periodic maintenance costs associated with its procurement. For a long time, gas turbine OEM companies like Siemens, Kawasaki, and Hitachi offered long-term service agreements for the duration of its usable life. However, power companies are looking for alternatives to reduce the procurement costs beyond its warranty period. The high procurement costs are making it difficult for small-scale and middle-scale buyers to procure gas turbines as these buyers operate on a low-profit-margin.
Fluctuations in gasoline prices
A gas turbine enables the combustion engine to convert gasoline to mechanical energy. The historical trends of gasoline prices seem to fluctuate a lot due to various reasons. Just a few years ago the prices of gasoline nosedived to less than half its value within a year. These rapid variations in the prices of gasoline compel buyers to resort to substitute products such as power storage devices and renewable energy sources for meeting their energy requirements. As a result, power companies prefer a more steady alternative, which is hindering the growth of the global gas turbine market.
Read more about the challenges in the gas turbine market along with gas turbine power plant, gas turbine generator, turbine engine, category management, procurement insights, pricing trends, and key suppliers in SpendEdge’s upcoming report on the global gas turbine market.