The Latin America Microgrid Market is projected to grow at a CAGR of 8.69% during the forecast period of 2023-28, cites MarkNtel Advisors in the recent research report owing to the vast presence of the non-conventional sources of energy in Latin American countries such as Chile, Brazil, etc. This richness combined with the increasing incorporation of renewable sources with microgrids to facilitate efficient & undisrupted power supply to different sectors such as communities, healthcare, education, industrial, and others, is supporting the development of the microgrid market in the region. In addition, the emergence of advanced technologies such as IoT & AI-based smart grids & energy storage systems are reinforcing the development of microgrid infrastructure in Latin America.
Moreover, the support provided by microgrids in case of extreme weather events leading to power outages due to faults & disruption in the main electricity grid is elevating the adoption of microgrids as a backup power source. The large presence of isolated & remote areas due to the presence of mountains, forests, and river basins mandates the establishment of an alternate power source, as extending the main grid connection is an expensive & difficult affair in such areas.
Traditionally, governments have been fulfilling this demand with the usage of diesel generators. However, fuel shortages created by complications in diesel logistics & high rates of carbon emissions are restricting the utilization of this method. Thus, governments are increasingly shifting towards the establishment of microgrids to provide reliable power in these regions.
Additionally, the presence of high carbon-emitting industries such as mining & transportation and the growing emphasis of these sectors towards sustainability & environmental friendliness would mount the adoption of renewable energy-based microgrids in the upcoming years, further states the research report, “Latin America Microgrid Market Analysis, 2023.”
Latin America Microgrid Market Segmentation Analysis
Off-Grid to Push the Demand for Microgrid Infrastructure
Based on the connectivity, the market is further bifurcated into On-grid & Off-grid. Among these, Off-grid is registering increasing demand due to the high usage of renewable energy resources, such as solar, wind, etc., for powering microgrids that are not connected to the main grid coupled with the high richness of Latin American countries in these resources.
.png)
Additionally, the growing inclination of the government to develop decentralized energy systems to support localized energy generation is easily facilitated by off-grid systems. The role of these grids in making communities self-sufficient in meeting their energy needs & reducing dependence on centralized power systems is supporting the growth of this segment, eventually creating a positive outlook for the Latin America Microgrid Market in the future years.
Chile to Become a Prominent Market for Microgrid Across Latin America
Chile is estimated to generate significant demand for microgrids in the forecast years. This attributes to the large-scale presence of the mining industry in the country & the high requirement of microgrids in facilitating the power generation requirement of the mining industry. The high focus of the country's government is to develop renewable energy resources for fulfilling its carbon emissions reduction goals.
The role of microgrids in reducing carbon footprints on a large scale is thus raising their deployment across the country. Also, the large presence of renewable energy resources, such as wind, solar, etc., in Chile is increasing the integration of microgrids into a varied number of sectors of the country, which would contribute to the Latin America Microgrid Market growth in the upcoming years.
Competitive Landscape
With strategic initiatives, such as mergers, collaborations, and acquisitions, the leading market players, including ABB Ltd., GE Grid Solutions, Eaton, Siemens, Caterpillar, Honeywell, Hitachi Energy, Emerson, SINOSOAR, Cummins, and Others are looking forward to strengthening their market position.
Key Questions Answered in the Research Report