Gas Engines Market Report 2026

The gas engines market size has grown strongly in recent years. It will grow from $5.38 billion in 2025 to $5.66 billion in 2026 at a compound annual growth rate (CAGR) of 5.2%. The growth in the historic period can be attributed to expansion of natural gas infrastructure, increased use in power generation facilities, growing industrial demand for captive power, adoption of gas engines in marine applications, availability of cost-effective gas fuels.

The gas engines market size is expected to see strong growth in the next few years. It will grow to $6.92 billion in 2030 at a compound annual growth rate (CAGR) of 5.2%. The growth in the forecast period can be attributed to increasing investments in renewable-integrated power systems, rising demand for low-emission engines, expansion of hydrogen-ready engine technologies, growth in decentralized energy generation, increasing adoption in microgrid systems. Major trends in the forecast period include expansion of gas engines for distributed power, increasing use of biogas and alternative fuels, growing demand for high-efficiency gas engines, rising adoption in grid balancing applications, integration of digital engine management systems.

Rising use of natural gas for power generation is expected to drive the growth of the gas engine market. Power generation involves producing electricity from sources such as fossil fuels, nuclear plants, and hydropower, including both combined heat and power (CHP) and electricity-only facilities. The modularity and high cost-efficiency of gas engines make them an optimal solution for stable power needs. For example, in December 2023, the International Energy Agency, a France-based energy authority, reported that natural gas supplied more than half of U.S. electricity demand for the first time on August 28, 2023, with its share of the summer power mix rising from 40% to 45% over two years. Consequently, increasing natural gas usage for power generation is driving demand for gas engines.

Key companies in the gas engine market are developing high-efficiency natural gas engine cogeneration systems to maintain a competitive edge. Engine cogeneration systems, or CHP systems, simultaneously generate electricity and useful heat from a single energy source, typically an internal combustion engine. For instance, in March 2023, Mitsubishi Heavy Industries Engine & Turbocharger, Ltd., a Japan-based engines and power systems company, launched the SGP M2000, a natural gas engine cogeneration system with a 2,000 kW generation output. It features a 16-cylinder natural gas-fired engine, the G16NB, achieving 44.3% electrical efficiency - a 1.8 percentage point improvement over MHIET’s 1,000 kW gas engine system - while reducing footprint by 40%. Designed for distributed energy resources (DER), the SGP M2000 maximizes efficiency and minimizes environmental impact, supporting carbon neutrality initiatives.

In August 2024, DEUTZ AG, a Germany-based company specializing in engine industrial machinery and equipment, acquired Blue Star Power Systems, Inc. for an undisclosed amount. This acquisition aims to transform DEUTZ from a component manufacturer into a comprehensive solutions provider for decentralized electricity generation. It allows the company to enter the rapidly expanding genset market in the USA, with anticipated additional annual revenues exceeding US$ 100 million. The acquisition also facilitates the strategic expansion of DEUTZ's energy-related business models while enhancing its portfolio of sustainable products in response to the growing global electricity demands and the increasing importance of renewable energy sources. Blue Star Power Systems, Inc. is a US-based provider of power generation systems, including diesel and gaseous-driven generators.

Major companies operating in the gas engines market are Caterpillar Inc., Cummins Inc., Wärtsilä Oyj Abp, Mitsubishi Heavy Industries Ltd., Hyundai Heavy Industries Co. Ltd., Maschinenfabrik Augsburg-Nürnberg AG (MAN Energy Solutions), General Electric Company, Kawasaki Heavy Industries Ltd., Liebherr-International AG, Kohler Co., Yanmar Co. Ltd., Perkins Engines Company Limited, Doosan Group, INNIO Jenbacher GmbH & Co. OG, Deutz AG, Guascor Power, Dresser-Rand, Motoren- und Turbinen-Union Friedrichshafen GmbH (Rolls-Royce Power Systems / MTU), Fairbanks Morse LLC, Jinan Lvneng Power Machinery Equipment Co. Ltd., Ningbo C.S.I. Power & Machinery Group Co. Ltd., Baudouin, CNPC Jichai Power Complex, Googol Engine Tech Co. Ltd., Lombardini Srl, Chongqing Winyou Power Co. Ltd., Briggs & Stratton Corporation, KUBOTA Corporation, Generac Power Systems Inc.

North America was the largest region in the gas engines market in 2025. The regions covered in the gas engines market report are Asia-Pacific, South East Asia, Western Europe, Eastern Europe, North America, South America, Middle East, Africa. The countries covered in the gas engines market report are Australia, Brazil, China, France, Germany, India, Indonesia, Japan, Taiwan, Russia, South Korea, UK, USA, Canada, Italy, Spain.

The gas engine market consists of sales of stoichiometric Otto cycle engines, biogas engines, and shale gas engines. Values in this market are ‘factory gate’ values, that is the value of goods sold by the manufacturers or creators of the goods, whether to other entities (including downstream manufacturers, wholesalers, distributors, and retailers) or directly to end customers. The value of goods in this market includes related services sold by the creators of the goods.

The market value is defined as the revenues that enterprises gain from the sale of goods and/or services within the specified market and geography through sales, grants, or donations in terms of the currency (in USD unless otherwise specified).

The revenues for a specified geography are consumption values that are revenues generated by organizations in the specified geography within the market, irrespective of where they are produced. It does not include revenues from resales along the supply chain, either further along the supply chain or as part of other products.

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