Egypt Diesel Generator Market Research Report: Forecast (2023-2028)
Market Insights & Analysis: Egypt Diesel Generator Market (2023-28)
The Egypt Diesel Generator market is projected to grow at a CAGR of around 9.59% during the forecast period, i.e., 2023-28. Diesel generators have been in high demand from the agricultural sector for some time now, which has propelled the market in the past several years. Farmers in Egypt have relied largely on diesel generators to pump water from wells to the ground in locations distant from the Nile River for agriculture.
Moreover, the expansion of fish farming has significantly fueled the demand for standby diesel generators in Egypt. Water pumps require continuous energy during aquaculture operations to safeguard fish in water ponds to ensure the constancy of power supply to the water pumps in aquaculture operations. Hence, diesel generators have been employed to operate as an additional power backup source during power outages, saving fish from death.
Furthermore, to cater to the growing demand for diesel generators from various sectors, such as industrial, residential, commercial, etc., in Egypt, the dealers & distributors of diesel engines & assemblers of diesel generators have been collaborating. The burgeoning investments by the government of Egypt in construction activities to strengthen the country’s economy are also expected to compel the requirement for diesel generators in the coming years, as they are required to deal with emergency power outage situations as well as for prime power.
| Report Coverage | Details |
|---|---|
| Study Period | Historical Data: 2018-21 |
| Base Year: 2022 | |
| Forecast Period: 2023-28 | |
| CAGR (2023-2028) | 9.59% |
| Key Companies Profiled | Cummins, Generac Holdings Inc., Caterpillar Inc., FG Wilson, Rolls-Royce Solutions Middle East FZE, Aksa Power Generation FZE, Atlas Copco Equipment Egypt, Kohler-SDMO, Himoinsa Middle East FZE, Kirloskar DMCC |
| Unit Denominations | USD Million/Billion |
According to the Ministry of Housing, Utilities & Urban Communities, the investments by both the government & private sector to expand construction in various sectors, such as residential, commercial, industrial, etc., reached about USD24.42 billion as of 2022. Following this, in the same year, the government of Egypt announced plans to implement 45 major national & strategic infrastructure projects that include 18 overpasses, the completion of 1000km of electrification of railway signals, the expansion of a metro network, and the completion of 47 express train stations, etc.
In addition, the key elements propelling the market for diesel generators in Egypt are the rising electricity demand supported by the nation's economic diversification plans like Egypt Vision 2030 launched in 2016 to achieve the principles & goals of sustainable development in all fields. Similarly, Egypt's long-term national development framework, as well as the rising number of ongoing industrial projects like the Industrial City in Atfih, Coal-Fired Power Plant (Hamrawein), El-Dabaa Nuclear Power Plant, and Coal-Fired Power Plant (Suez) are also predicted to contribute to the revenue of the market.
Furthermore, the Industry and Trade Development Strategy, the ICT Strategy 2030, and the New Customs Law 2020 are a few other government initiatives that aim to develop & strengthen public service sectors like commercial, manufacturing, healthcare, ICT, and telecommunication. Consequently, there would be a significant demand for power backup equipment for development activities, expected to drive the market in the forecast years.
Market Dynamics
Growth Driver: Increased Development in End Use Industries to Contribute to Market Growth
The demand for diesel generators observed a positive growth in Egypt during historical years, owing to the expanding oil & gas and construction activities across the sectors such as residential, commercial, etc. Furthermore, the country is also attracting foreign direct investments (FDI) due to the introduction of a more business-friendly investment law in the country and the presence of important energy resources such as natural gas. According to International Trade Administration (ITA), FDI in the oil and gas sector increased from USD9 billion in FY 2014-2015 to USD47.8 in FY 2019-2020. For instance,
Also, the government of Egypt is investing in the manufacturing industry to promote local industrialization, and thereby increase the competitiveness of local products. These development plans are raising the energy requirement of manufacturing industries. Thus, Egypt Diesel Generator market size would enhance in the upcoming years attributable to the continuous & increasing energy requirements of the flourishing oil & gas industry, and manufacturing & construction industry.
Possible Restraint: Availability of Natural Gas Generators to Hinder the Market Growth
The significant contribution of diesel generators to the concentrations of sulfur dioxide (So2), nitrous oxides (NOx), carbon dioxide (Co2), and other pollutants that affect human health as well as the environment is affecting the demand for these generators negatively. In addition, the growing concerns about such emissions are leading to the launch of eco-friendly generators such as natural generators & bi-fuel generators in the Egyptian market. For instance,
Thus, the rising focus of the government on clean energy and the significant role played by natural gas generators in reducing emissions is estimated to hamper the sale of diesel generators in the country in the upcoming years.
Growth Opportunity: Growing Government Push for the Petrochemical Industry Development to Boost the Demand for Diesel Generators
A significant presence of crude oil reserves & efficient manufacturing infrastructure in Egypt is driving investments in the petrochemical industry by manufacturers such as Tahir Petrochemicals & Red Sea Refining & Petrochemical Co., among others, thereby, leading to an incessant need for diesel generators.
The consistent need for electricity in the hydrocarbons industry to power the distillation equipment & ensure a regular supply of power to minimize the machine downtime cost is widely encouraging the deployment of diesel generators in the petrochemical industry. Along with this, the Egypt government is investing heavily to boost the petrochemical capacity of the country & to enhance the GDP growth.
Hence, the rising inclination of the Egypt government to boost investments in the development of petrochemical manufacturing plants is anticipated to create a lucrative opportunity for revenue growth of the Diesel Generator market during 2023-2028.
Key Trend: Growing Adoption of Hybrid Diesel Generators Among the End Users
The government in Egypt is constantly pushing toward the usage of sustainable & cleaner fuels like solar, wind, etc., to decarbonize its economy. To achieve this goal Egyptian government is being very vigilant of the carbon & PM 2.5 emissions in the country, and reducing the carbon footprints. As a result, customers in the residential & commercial sectors, etc., are switching towards hybrid diesel generators in recent years. These hybrid diesel generators are a combination of two sources of energy as they can run on conventional fuel like diesel & can also be supported by renewable energy such as solar or wind.
Additionally, they are equipped with noise cancellation & carbon emission sensors that make these generators environment-friendly & sustainable. These technological advantages have led to the growing adoption of hybrid diesel generators in place of conventional diesel generators in the country.
Furthermore, end-users are expected to switch from conventional diesel generators to hybrid ones, thereby creating a positive market outlook for the growth of the Diesel Generator market in Egypt in the forthcoming years.
Market Segmentation
By Type
Standby diesel generators witnessed significant growth, owing to the rapid construction of residential as well as commercial buildings in Egypt. The demand for these generators as a source of power generation & backup from corporate offices, retail malls, premium hotels, and others has also contributed considerably to the market's growth.
Besides, they are primarily used in the residential sector for elevators & escalators in high-rise buildings to avoid any kind of discrepancies, when the power goes off. Similarly, due to Egypt's thriving tourism industry, many hotels require power backup whenever there is a power outage to provide reliable & uninterrupted power supply to the visitors, hence elevating the demand for standby diesel generators during the estimated period.
By End User
The Residential Sector held a significant share in the Egypt Diesel Generator market in the past years in line with the rising development of housing units by the government of Egypt. The government's desire to supply affordable housing units to middle-income people has accelerated the construction of residential structures in Egypt. As a result, the need for standby & prime diesel generators with variable ratings to power the entire construction site during a power outage has expanded.
Additionally, the country's upper class has been changing into extravagant apartments, villas, bungalows, and many more, which has aided in the launch of various luxury housing developments in Egypt. The soaring construction of luxury housing units in several cities throughout the country, such as Cairo, Alexandria, and Giza, has resulted in an increased demand for these generators for a variety of purposes, including powering construction equipment during peak power requirements & providing backup power during power outages.
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Frequently Asked Questions
A. The Egypt Diesel Generator market is expected to grow at a CAGR of around 9.59% during 2023-2028.
A. The increased development in end-use industries to contribute to market growth is expected to drive the market.
A. Cummins, Generac Holdings Inc., Caterpillar Inc., FG Wilson, Rolls-Royce Solutions Middle East FZE, Aksa Power Generation FZE, Atlas Copco Equipment Egypt, Kohler-SDMO, Himoinsa Middle East FZE, and Kirloskar DMCC.
A. Standby is the leading segment in the Egypt Diesel Generator Market.
A. The growing adoption of hybrid diesel generators among end users is the key trend shaping the growth of the Egypt Diesel Generator Market.
A. The availability of natural gas generators to hinder the market growth are a possible restraint affecting the growth of the Egypt Diesel Generator Market.
