Large-Scale Oil & Gas Exploration Activities to Offer Impetus to Power Rental Market
The global power rental market has witnessed sizeable growth fueled by the increasing commencement of new projects in the mining, manufacturing, marine, and utility sector across diverse locations. Quick service allocation, favorable renting schemes offered by manufacturers as well as challenges associated with the transportation of equipment setup from one place to another will positively influence the business outlook.
Reports estimate that the global power rental market size is projected to amass USD 16 billion in valuation by 2027. Frequent cases of power outages and brownouts, the presence of aging distribution and transmission lines, and recurring natural calamities will support industry growth. Additional factors like rapid expansion of commercial spaces like hotels, malls, supermarkets, and other public as a result of increasing urbanization will support the adoption of 75kVA to 375 kVA rated power rental units.
The rise in population coupled with an increase in disposable income has led to the demand for continuous and reliable power supply. Notably, prime power rentals are slated to witness robust demand due to their extensive range of applications across off-grid and remote locations that have zero or restricted access to electricity.
According to the Energy Access Outlook report (2019) by IEA, nearly 771 million lacked basic access to electricity, out of which 75% of the people belonged to the Sub-Saharan region of Africa. Rising electricity demand from underdeveloped regions that witness extended power outage even during peak working hours will boost the market scenario.
Regionally speaking, European power rental market has emerged as a profitable revenue terrain led by Germany that held for more than 14% of the market’s revenue share in the year 2020. The regional market is likely to witness momentum due to shifting government focus on the reduction of cost, energy efficiency, and environmental compliances.
The frequent occurrence of storms and failure of the electricity grid will spark the demand for reliable power backup systems. Additionally, supportive public and private investment across the region in order to drive innovations across the sectors will steer product deployment.
The power rental industry is slated to grow substantially in the oil and gas sector based on surging demand for power across upstream, midstream, and downstream businesses for supporting continuous operations. Partial grid connectivity across sites that are located across offshore and remote locations will support the need for power rental units. Suitable infrastructural investment along with growing adoption of large-scale oil and gas exploration projects is likely to augment business outlook.
Moreover, site operators usually prefer power renting services on account of unbalanced operational structures of oil wells through upstream operations. Power rental companies are actively investing in R&D to advance their technology in order to offer reliable energy solutions. Few of the industry players that are making substantial advancements include Caterpillar, Cummins, United Rentals, and Atlas Copco. Growing demand for power rental units due to their easy accessibility, fuel flexibility, and reduced O&M cost will support industry outlook in the forthcoming years.