The Growing Popularity of Compressed Natural Gas (CNG) as a Clean Energy Source
The CNG tanks cylinders market reached US$ 1.7 billion in 2022. Demand for CNG tanks cylinders is estimated to surpass US$ 1.8 billion in 2023. During the forecast period, sales are poised to exhibit a 6.7% CAGR. Revenue is anticipated to cross around US$ 3.5 billion by 2033.
Key Market Highlights
The carbon fiber segment is likely to spearhead the material segment of the market. This segment is expected to expand at 6.6% CAGR during 2023 to 2033.
Growing concerns about environmental impact and emissions have led to an increased interest in CNG as a clean alternative to traditional fuels. This, in turn, is driving the demand for CNG cylinders.
CNG is becoming more popular as countries and companies move toward clean sources of energy to minimize carbon emissions. It will help reduce greenhouse gas emissions compared to traditional fossil fuels.
As per the data provided by the Department of Energy, in the United States, around 175,000 automobiles run on natural gas, while about 23 million vehicles do so globally. Compressed natural gas (CNG) fuelling is a consistent source in many regions.
High availability makes natural gas vehicles (NGVs) an excellent option for high-mileage, centrally fuelled fleets. NGVs might have applications that are confined to those areas with similar fuel range support. CNG is being utilized as a fuel for automobiles more often, particularly in fleets of public transit and commercial vehicles. This drives the demand for CNG tanks and cylinders for storing and transporting the fuel.
The expansion of CNG refueling infrastructure is crucial to support the adoption of CNG as a fuel. As a result, more CNG tanks and cylinders need to be produced and installed. CNG might be utilized to store energy, particularly when there is extra renewable energy that has to be kept for later use. This application calls for more CNG storage space. Clean energy sources such as CNG can also find applications in industries that require heat or power generation. This diversifies the demand for CNG tanks and cylinders beyond just transportation.
Strict environmental regulations on emissions can encourage companies to switch to clean fuels such as CNG. This drives demand for the necessary storage and transport infrastructure.
CNG can be a solution for reducing energy waste in situations where excess renewable energy is generated but cannot be immediately used. Storing this energy in the form of CNG can mitigate waste and bolster demand for storage solutions. As the global energy landscape evolves towards sustainability, CNG can play a role in reducing reliance on traditional fossil fuels. It will help in creating a sustained demand for CNG tanks cylinders.
Historical Performance of CNG Tanks Cylinders Market
The market experienced steady growth at 8.2% CAGR during the historical period from 2018 to 2022. In the forecast period, the CNG tanks cylinders industry is set to register 6.7% CAGR.
There has been a recent increase in the popularity of compressed natural gas (CNG) as a vehicle fuel, particularly in commercial fleets and public transit. This is likely to increase the demand for CNG tanks cylinders for storing the gas for usage in cars and buses. The growth of CNG as a transportation fuel necessitates the development of refueling infrastructure. This infrastructure expansion would require a greater number of CNG tanks and cylinders.
CNG is seen as a way to reduce carbon emissions in transportation. This will stimulate demand for CNG tanks and cylinders to support the growing fleet of vehicles running on CNG. Governments offer incentives and subsidies to encourage the adoption of clean fuels. These policies can increase the demand for CNG-powered vehicles and, subsequently, for CNG tanks and cylinders.
Apart from transportation, CNG is used in different industrial processes and power generation. The demand for CNG tanks and cylinders in industrial applications is likely to rise as businesses seek clean energy solutions. The diversification of energy sources for transportation and industrial sectors through CNG can enhance energy security. Thereby driving the demand for CNG tanks and cylinders.
The growth of the CNG market might lead to innovations in tank and cylinder design, material, and manufacturing processes, further contributing to market demand. Geopolitical considerations can influence energy transitions. Countries with ample natural gas resources might encourage CNG adoption, boosting the demand for associated tanks and cylinders. As the energy transition spreads to more regions globally, the demand for CNG tanks and cylinders could see increased adoption in previously untapped markets.
Latest CNG Tanks Cylinders Market Trends Listed by Future Market Insights (FMI)
Strict emissions regulations and incentives to promote the use of alternative fuels are encouraging the adoption of CNG vehicles, thereby boosting the CNG cylinder market.
Advancements in Composite Materials
The development of lightweight and durable composite materials for CNG cylinders enhances their safety, capacity, and efficiency, making them more attractive to consumers.
Increased Adoption in Transportation
CNG is gaining traction in commercial fleets and public transportation due to its cost-effectiveness and lower emissions, driving the need for more CNG cylinders.
Expanding CNG refueling infrastructure supports the growth of the CNG market and encourages fleet operators to invest in CNG vehicles and cylinders.
Urbanization and Air Quality Concerns
Increasing urbanization and air quality concerns in cities are pushing for clean transportation solutions, which in turn drives the demand for CNG tank cylinders.
Growing Popularity of Renewable Energy Pushing Sales of CNG Tanks Cylinders in the United States
According to Future Market Insights (FMI) analysis, the United States market for CNG tanks cylinders is set to hold a total of around US$ 632.7 million by 2033. It is predicted to expand at 6.6% CAGR during the forecast period (2023 to 2033).
Growing popularity of vehicles that operate with CNG gas is likely to drive demand in the United States. The demand for more affordable and sustainable fuel choices is what’s fueling growth.
Government regulations aimed at reducing emissions and promoting clean transportation have played a role in the growth of the CNG tanks cylinders market. The use of CNG and other alternative fuels is encouraged by these policies. Several commercial fleets, including taxis, buses, and delivery trucks, have started switching to CNG-powered vehicles. This has led to increased demand for CNG tanks cylinders to store the fuel.
Compressed natural gas, which produces fewer toxins and particles than gasoline or diesel, is seen to be a safer fuel than those two. It is a more enticing choice for consumers and businesses because it is less costly than conventional fuels.
The expansion of CNG refueling infrastructure is critical for the growth of the CNG tanks cylinders market. As more refueling stations are built across the country, the demand for CNG tanks cylinders is likely to increase.
Several companies are involved in the manufacturing and distribution of CNG tanks cylinders in the United States. These companies compete in terms of technology, design, and safety features. The CNG tanks cylinders market is also influenced by global energy trends and geopolitical factors that impact natural gas supply and demand.
Increasing Adoption of Natural Gas to Boost CNG Tanks Cylinders Market in China
China CNG tanks cylinders industry is poised to exhibit a CAGR of 6.6% during the assessment period. By 2033, China market size is expected to reach US$ 795.6 million.
The CNG tanks cylinders market in China is expected to witness decent growth during the forecast period. This is due to the increasing adoption of natural gas as a clean alternative to traditional fuels. China government’s focus on reducing air pollution and carbon emissions has driven the demand for CNG-powered vehicles. This is consequently boosting the CNG tanks cylinders industry in the country. China has been investing in the expansion of CNG refueling infrastructure, encouraging the use of CNG-powered vehicles across various regions.
Government policies, such as subsidies for CNG vehicles and refueling stations, have played a role in promoting the growth of the CNG tanks cylinders market. Several domestic and international companies are engaged in manufacturing CNG tanks cylinders in China to cater to the increasing demand.
Ensuring the safety of CNG storage and transportation is crucial, leading to the implementation of stringent safety standards and regulations for CNG tanks cylinders. Ongoing research and development efforts aim to improve the efficiency, capacity, and safety of CNG tanks cylinders, driving innovation in the market.
To satisfy consumer requests and safety regulations, leading companies concentrate on producing lightweight, strong, and high-capacity CNG cylinders. To improve the effectiveness, safety, and performance of CNG cylinders, they are merging cutting-edge materials and production procedures.
Leading manufacturers seeking to expand into new markets by forming alliances, distribution networks, and partnerships with regional players.
In April 2023, The Altroz iCNG, Tata Motors’ much-anticipated premium hatchback, made its formal debut. This design now boasts a new twin-cylinder CNG tank technology, making it the first vehicle in India.
In August 2023, The Tiago and Tigor upgraded CNG vehicles, which now have the upgraded twin-cylinder CNG tank layout, have been released by Tata Motors.