A Brief Analysis of the New Trends in Global Internal Combustion Engine Power Generation
The global energy sector is undergoing a structural transformation, driven by both the renewal of traditional power plant equipment and the explosion of AI computing power. As the power infrastructure of various countries enters a period of intensive replacement, coupled with the exponential growth in power demand from artificial intelligence data centers, the market for high-power diesel engines and natural gas generator sets is experiencing an unprecedented tight supply-demand situation. This market imbalance has created significant business opportunities – enterprises that can quickly lock in production capacity and ensure supply will reap excess profits and gain long-term competitive advantages.
The global diesel engine and natural gas generator market has entered a typical seller’s market cycle, with the imbalance between supply and demand continuing to intensify. In 2024, the global diesel generator set market reached a size of $17.864 billion, and it is expected to climb to $25.509 billion by 2029, with an average annual compound growth rate of 7.02%. Similarly, the natural gas generator market is also experiencing strong growth. In 2024, the global market size was approximately $77.45 million, and it is expected to reach $114.90 million by 2031, with a compound annual growth rate of 5.9% during this period. This situation, where demand growth far exceeds the expansion rate of supply capacity, has led to extended delivery cycles for high-power units and significant upward pressure on prices.
The global supply side of diesel engines and natural gas generators faces multiple development bottlenecks, with the pace of capacity expansion lagging far behind the growth of demand. The core of this supply-demand imbalance lies in the high complexity of producing high-power generator sets and the fragility of the supply chain system
The vulnerability of the supply chain restricts the efficiency of production capacity release. A high-power generator set comprises tens of thousands of components and relies on a globally collaborative supply chain system. Fluctuations in the supply of raw materials such as steel, non-ferrous metals, and rubber, as well as important components such as cylinder blocks, crankshafts, and pistons, in the upstream of the diesel engine industry chain directly affect the overall production capacity.
From the perspective of product structure, the supply-demand imbalance is particularly prominent for high-power units (above 2000 kW). The high-power diesel engine and dual-fuel engine newly developed by CSIC Heavy Industry can meet the demand for generator sets with rated power ranging from 2.8 MW to 22 MW, filling the domestic market gap for self-controllable high-power diesel engines above 3 MW. This technological advancement is still difficult to quickly alleviate the market shortage.
The formation of a seller’s market is attributed to the substantial international rigid demand. Given the insufficient production capacity of traditional industry giants such as MAN, WARTSILA, and CAT, CSSC Power, which offers better cost-effectiveness and shorter delivery times, has become the preferred choice for high-power heavy fuel oil power generation and dual-fuel power generation. Whoever secures the supply first will be able to profit as early as possible, and this has already become a foregone conclusion
Powerplus has long recognized the substantial demand for diesel, heavy oil, and natural gas generator sets. Therefore, we have partnered with CSSC Heavy Industry to introduce high-quality engines and reliable power output services to meet the global electricity needs of our customers. Our primary models can run on diesel or heavy oil as fuel, and can also utilize 1% diesel for ignition with 99% natural gas as the primary fuel, greatly expanding customers’ fuel options, reducing fuel costs, and enhancing power generation efficiency. Regardless of the user’s location, there is always a suitable generator that can accommodate the optimal local fuel choice. Therefore, whoever can seize this resource will gain an advantageous position in the future energy market. Customers with electricity needs are encouraged to contact us as soon as possible to secure production capacity resources info@gdpowerplus.com