To cater the increasing power demand across the Middle East and Africa, signing supply contracts is adopted by maximum industry players as a key strategy in order to achieve growth in the power rental market. Permanent power producers’ inability to meet the power demand at regular periods and especially during extremely hot weather conditions, are considered as opportunities for the Middle East and Africa power rental market. This market is estimated to reach $9,048.25 million at a CAGR of 18.08% from 2014 to 2019.
The power rental market is defined as the revenue earned either through renting generators or from a temporary power plant. Earlier, power rental companies would rent out generators, the maintenance responsibility for which would have to borne by company itself, and the cost earned from renting such generators generated revenue for the power rental market. Now, power rental companies build and maintain temporary power plants and charge users on the basis of duration, capacity build, and electricity units supplied.
The power rental market in the Middle East and African region has a significant growth rate, as it is an economically sustainable option to rent out generators over installing an IPP for the same purpose.
Growing population, urbanization, and customized standards of living are seen improving in the Middle Eastern and African countries which are in turn likely to increase the demand for power in the coming years. Grid networks being poor or erratic in certain areas, power rentals would emerge as a feasible option to meet end-user requirements. This has created many opportunities for rental power service providers that can offer accelerated turnkey power solutions.
Saudi Arabia is the largest market for power rental in the Middle East and Africa, owing to the increased construction activities. UAE and South Africa are also one of the attractive markets for the power rental industry in the regions of the Middle East and Africa.
Middle East And Africa Market Share, by End-Users, 2019, ($Million)
Note: Other end users include Industrial, Shipping, Mining, Events, universities, government, hospitals
Source: Related research publications, and MarketsandMarkets Analysis
Currently, utilities sector dominate the power rental market of the Middle East and Africa in the end-user segment. Oil & gas market occupy the second largest market share in the oil rich regions of the Middle East and Africa. Construction segment is also one of the largest growing segments in the power rental industry.