by The backup power market comprises systems that provide electricity during power outages caused by grid failures, blackouts or shut downs. Backup power sources include generators, batteries and UPS systems. Generators are the traditional backup power source and range from portable petrol/diesel generators used for home backup to large stationary generators used for commercial and industrial facilities. Advancements in battery technologies have made battery backup systems increasingly popular for both residential and non-residential use. Lithium-ion batteries are widely adopted due to their high energy density, long life cycles and reducing costs. UPS systems provide instantaneous backup power during brief outages by using an internal battery until the generator kicks in.
The global backup power market is estimated to be valued at US$ 2.66 Bn in 2023 and is expected to exhibit a CAGR of 5.4% over the forecast period 2023 to 2030, as highlighted in a new report published by Coherent Market Insights.
Reliable and uninterrupted power supply is crucial for industrial, commercial and residential facilities. Outages and fluctuations can cause equipment and system damage as well as loss of productivity and revenue. Additionally, data centers, healthcare facilities, transportation systems, commercial complexes etc require stable power for critical applications and continuous operations. The ever-growing demand for reliable and green backup power solutions from end-use sectors is expected to propel market growth over the forecast period.
Market key trends:
Growing adoption of smart and hybrid backup power systems: The backup power market is witnessing a major trend of increasing adoption of advanced smart and hybrid backup power systems that leverage the benefits of different power sources. Hybrid systems integrate battery storage with generators to provide cleaner backup power. They automatically switch between stored battery power and generated power. Smart systems have remote monitoring capabilities and optimize performance. The introduction of renewable energy integrated hybrid systems that combine solar, wind and battery storage is transforming the landscape. Major players are innovating hybrid products to tap into the benefits of different technologies.
Porter’s Analysis
Threat of new entrants: Low cost of production and capital requirements make it difficult for new companies to enter the backup power market.
Bargaining power of buyers: Large buyers can negotiate lower prices due to their higher purchase volumes. However, the need for reliable backup power limits switching.
Bargaining power of suppliers: The presence of many component manufacturers keeps supplier power in check. However, battery suppliers wield some pricing influence.
Threat of new substitutes: Alternatives like battery storage are gaining ground but lack the scalability and proven reliability of conventional generator sets.
Competitive rivalry: The market is fragmented with multiple technology providers. Competition is based on product performance, pricing, brand reputation and quality.
Key Takeaways
The Global Backup Power Market Demand is expected to witness high growth. Rapid digitization and critical importance of uninterrupted power are driving large-scale adoption across industries. The global backup power market is estimated to be valued at US$ 2.66 Bn in 2023 and is expected to exhibit a CAGR of 5.4% over the forecast period 2023 to 2030.
Regional analysis: North America dominates due to frequent power outages and advanced cold climate technologies. Asia Pacific is growing rapidly led by increasing data center construction and e-commerce penetration in countries like China and India. Generating set sales are rising across developing Asian and African markets with expanding industrial and commercial infrastructure.
Key players: 3M Compan, Caterpillar, Cummins, Aggreko, Atlas Copco, Ballard Power Systems, Himoinsa, and Kohler Power are some major companies in the backup power industry. 3M Compan offers natural gas and bi-fuel generators along with manual transfer switches. Caterpillar provides diesel, natural gas and biodiesel generator sets for mission critical and prime power applications.
*Note:
1. Source: Coherent Market Insights, Public sources, Desk research
2. We have leveraged AI tools to mine information and compile it
