Gas Engine Market Trends

Growth Drivers:

• Rising focus on environmental sustainability: The transportation industry plays a pivotal role in supporting the best chance of achieving the Paris Agreement’s mission to limit GHG and global warming to below 2 °C with a transformation in road transport by the end of 2050. ICCT’s observations show that efforts in line with reducing global warming by 1.5 °C correspond to minimizing emissions from fuel and electricity production and combustion for transport by a minimum of 80% as compared to today’s levels by 2050, particularly passenger cars. PHEV life-cycle GHG emissions are determined by EV versus gas engine (combustion engine) in real-world drive share or usage. This varies significantly among regions. The medium-size PHEV life-cycle GHG emissions when compared to gasoline cars is roughly 42%–46% lower in the U.S., 6%–12% lower in China, and 25%–27% lower in Europe.

• Growing demand for distributed power generation: Gas engines are well-suited for decentralized or distributed power generation systems and are well-suited for combined heat and power (CHP) applications.  The distributed generation capability makes gas engines appealing for industries, commercial buildings, and residential applications seeking reliable and efficient power solutions. Argonne National Laboratory has an active project focusing on enhancing performance and minimizing emissions of natural gas-fired stationary reciprocating engines by leveraging distributed generation with power outputs range 0.5 to 20 megawatts.

Challenge

• Threat of substitute: The increasing adoption of electric vehicles poses a key competition for the gas engine market. The rising popularity and adoption of renewable EV alternatives that are cost-effective and sustainable is a key market challenge. Furthermore, volatile gas prices are nudging customers to opt for automobiles that re fully electric or hydrogen-fuel cell based.