Cogeneration Equipment Market Report 2026

The cogeneration equipment market size has grown rapidly in recent years. It will grow from $32.04 billion in 2025 to $35.25 billion in 2026 at a compound annual growth rate (CAGR) of 10%. The growth in the historic period can be attributed to industrial demand for energy efficiency, expansion of manufacturing facilities, rising electricity and heat consumption, availability of cogeneration incentives, adoption of combined heat and power systems.

The cogeneration equipment market size is expected to see rapid growth in the next few years. It will grow to $53.07 billion in 2030 at a compound annual growth rate (CAGR) of 10.8%. The growth in the forecast period can be attributed to increasing decarbonization initiatives, rising investments in distributed energy systems, expansion of renewable fuel integration, growing demand for resilient power infrastructure, increasing use of digital energy optimization tools. Major trends in the forecast period include increasing deployment of high-efficiency chp systems, growing adoption of natural gas and biogas-based cogeneration, rising integration of smart energy management controls, expansion of distributed energy generation solutions, enhanced focus on emissions reduction.

Rising energy consumption is expected to drive the growth of the cogeneration equipment market in the coming years. Energy consumption refers to the amount of fuel, including natural gas, oil, propane, and electricity, used by a facility during a billing cycle. Cogeneration is a highly efficient technology for producing energy, improving energy efficiency, and reducing energy costs. For example, according to the European Environment Agency (EEA), a Denmark-based EU agency, in 2024, 25.4% of the European Union’s final energy consumption came from renewable sources, up about 1 percentage point from 2023, moving the EU closer to its 2030 renewable energy target of 42.5%. Therefore, increasing energy consumption is driving demand for cogeneration equipment.

Key players in the cogeneration equipment market are developing advanced technologies, such as natural gas engine cogeneration systems, to improve energy efficiency, reduce greenhouse gas emissions, and provide reliable power for diverse applications. A natural gas engine cogeneration system simultaneously generates electricity and useful thermal energy using natural gas as fuel. For instance, in March 2023, Mitsubishi Heavy Industries Engine & Turbocharger, Ltd. (MHIET), a Japan-based engineering and manufacturing company, launched SGP M2000, a new natural gas engine cogeneration system. The SGP M2000 is designed to maximize energy utilization by producing both electricity and heat with high efficiency while minimizing emissions. This system features advanced technology for seamless integration into industrial and commercial settings, providing reliable power and thermal energy. It also incorporates smart monitoring capabilities to improve operational performance and maintenance efficiency, supporting sustainability goals and reducing overall energy costs.

In September 2024, Yanmar Holdings Co., Ltd., a Japan-based heavy machinery and agricultural equipment manufacturer, acquired TEDOM Group for an undisclosed amount. This acquisition aims to expand Yanmar’s presence in the energy sector by integrating TEDOM’s cogeneration and decentralized energy solutions into its global energy systems business, enhancing technological capabilities and broadening energy service offerings. TEDOM Group, based in Czechia, provides cogeneration units and comprehensive decentralized energy solutions.

Major companies operating in the cogeneration equipment market are Tecogen Inc., Siemens AG, General Electric Company, Kawasaki Heavy Industries Ltd., Robert Bosch Gmbh, Clarke Energy, Mitsubishi heavy industries Ltd., A.B. Holding S.P.A., 2G Energy AG, Rolls Royce Plc, Caterpillar Inc., Allied Equipments Inc., American DG Energy Inc., Aegis Energy Services, Asea Brown Boveri Ltd., Capstone Turbine Corporation, Wärtsilä Corporation, Centrica plc, Cummins Inc., E.ON SE, Dresser-Rand Company Ltd., MAN Energy Solutions SE, Toshiba Energy Systems & Solutions Corporation, Veolia Environnement S.A., Vital Energi Utilities Ltd., BDR Thermea Group, Waste Management Inc., Solar Turbines Incorporated, Shanghai Electric Group Co. Ltd., Exelon Corporation, Sener Group.

Europe was the largest region in the cogeneration equipment market in 2025.North America is expected to be the fastest-growing region in the global cogeneration equipment market report during the forecast period. The regions covered in the cogeneration equipment market report are Asia-Pacific, South East Asia, Western Europe, Eastern Europe, North America, South America, Middle East, Africa. The countries covered in the cogeneration equipment market report are Australia, Brazil, China, France, Germany, India, Indonesia, Japan, Taiwan, Russia, South Korea, UK, USA, Canada, Italy, Spain.

The cogeneration equipment market consists of sales of chambers, turbines, air compressors, turbines, condensers, generators, and pumps. 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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