United Kingdom Combined Heat and Power Market Insights Forecasts to 2033

• The UK Combined Heat and Power Market Size was valued at USD 69.80 Billion in 2023.
• The Market is growing at a CAGR of 6.09% from 2023 to 2033
• The U.K. Combined Heat and Power Market Size is Expected to Reach USD 126.08 Billion by 2033

The United Kingdom Combined Heat and Power Market is Anticipated to Exceed USD 126.08 Billion by 2033, growing at a CAGR of 6.09% from 2023 to 2033.

Market Overview

CHP is an efficient and environmentally friendly method of generating both electricity and heat from one fuel source. CHP can lower carbon emissions by 30% compared to traditional methods of generating heat and power separately using a boiler and power station. CHP generates power on-site or near the end user, allowing the heat produced during power generation to be used for the user's heat requirements, while also meeting some or all of the site's energy needs. Industries that require a steady supply of electricity and heat are ideal candidates for implementing CHP systems due to their financial benefits. Industrial uses, particularly in companies with regular operations and high steam needs, are very cost-effective and account for a significant portion of current CHP capacity. Industries such as hospitals, nursing homes, laundries, and lodgings that need a lot of hot water are ideal for combined heat and power systems. Institutions like colleges and schools, correctional facilities, and private and athletic facilities present great potential for CHP. Anticipated to increase demand for CHP installation are the government regulations and significant financial incentives. The increasing use of natural gas, seen as a cheaper and more eco-friendly option compared to oil & coal, is expected to drive growth in the combined heat power market.

Report Coverage

This research report categorizes the market for the U.K. combined heat and power market based on various segments and regions forecasts revenue growth and analyzes trends in each submarket. The report analyses the key growth drivers, opportunities, and challenges influencing the UK combined heat and power market. Recent market developments and competitive strategies such as expansion, product launch, and development, partnership, merger, and acquisition have been included to draw the competitive landscape in the market. The report strategically identifies and profiles the key market players and analyses their core competencies in each sub-segment of the UK combined heat and power market.

Driving Factors

Rising need for electricity is fueling the worldwide market for combined heat and power (CHP) installations. The economic prosperity of the population is expected to drive an increase in demand for combined heat and power (CHP) installations. Autogas has been quickly embraced as a favored fuel due to the environmental advantages and strict government regulations aimed at decreasing carbon emissions. Government initiatives and incentives in U.K. are projected to boost the growth potential of the CHP (combined heat and power) market. Gas turbines have a competitive advantage due to their superior performance and dependability compared to other distributed generation options, making them ideal for backup power and on-site generation. Therefore, the increasing trend of distributed power generation is a notable development in the CHP installation market.

Restraining Factors

A lack of knowledge about the required permissions for installing combined heat power systems is hindering the development of the market. The installation of these systems is suitable only for establishments that need both electricity and hot water, serving as an obstacle to market expansion. Moreover, the high initial costs of implementing these cogeneration systems make them unaffordable for small businesses.

Market Segmentation

The United Kingdom combined heat and power market share is classified into fuel type, technology, and application.

• The natural gas segment is expected to hold the largest market share through the forecast period.   

The U.K. combined heat and power market is segmented by fuel type into natural gas, coal, biomass, and others. Among these, the natural gas segment is expected to hold the largest market share through the forecast period. Initiatives aimed at lowering installation and operational expenses, along with consistent financial support from both government and private sources, play a crucial role in encouraging the uptake of natural gas power plant projects.

• The combined cycle segment dominates the market with the largest market share over the predicted period.

The UK combined heat and power market is segmented by technology into combined cycle, steam turbine, gas turbine, reciprocating engine, and others. Among these, the combined cycle segment dominates the market with the largest market share over the predicted period. Utilizing waste heat from exhaust gases in combined cycle power plants helps minimize energy losses by generating extra electricity. Using these systems results in a more than 50% increase in the plant's overall efficiency.

• The utilities segment is the fastest-growing segment in the market share over the predicted period.

The UK combined heat and power market is segmented by application into utilities, residential, and commercial & industrial. Among these, the utilities segment is the fastest-growing segment in the market share over the predicted period. Utilities use CHP systems to sell the excess heat generated during electricity production, due to the cost savings from the systems' high efficiency. Furthermore, they utilize the heat produced to operate district combined heating or cooling systems that utilize steam, hot water, or chilled water as a source.

Competitive Analysis:

The report offers the appropriate analysis of the key organizations/companies involved within the United Kingdom combined heat and power market along with a comparative evaluation primarily based on their product offering, business overviews, geographic presence, enterprise strategies, segment market share, and SWOT analysis. The report also provides an elaborative analysis focusing on the current news and developments of the companies, which includes product development, innovations, joint ventures, partnerships, mergers & acquisitions, strategic alliances, and others. This allows for the evaluation of the overall competition within the market.

List of Key Companies

• Caterpillar Inc.
• Centrica PLC
• General Electric Company
• Mitsubishi Power Ltd
• Siemens Energy AG
• Ramboll Group
• Helec Limited
• Tedom AS
• Others

Key Target Audience

• Market Players
• Investors
• End-users
• Government Authorities 
• Consulting And Research Firm
• Venture capitalists
• Value-added resellers (VARs)

Recent Developments

• In May 2023, DS Smith has officially revealed the new Kemsley CHP plant in partnership with E.ON. The collaboration with energy provider E. ON has allowed DS Smith to introduce a combined heat and power (CHP) plant at their paper mill in Kent.

Market Segment

This study forecasts revenue at United Kingdom, regional, and country levels from 2020 to 2033. Spherical Insights has segmented the United Kingdom Combined Heat and Power Market based on the below-mentioned segments:

United Kingdom Combined Heat and Power Market, By Fuel Type

• Natural Gas
• Coal
• Biomass
• Others

United Kingdom Combined Heat and Power Market, By Technology

• Combined Cycle
• Steam Turbine
• Gas Turbine
• Reciprocating Engine
• Others

United Kingdom Combined Heat and Power Market, By Application

• Utilities
• Residential
• Commercial & Industrial