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Temporary Power

The Genset market in the GCC is ramping up

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Power, Temporary power, ANALYSIS

A genset is essentially a combination of an engine and an alternator, packaged in multiple configurations, with the prime purpose of generating electricity.

The engine itself could utilise various types of fuels, namely diesel (the most prominent in the Middle East), gas, and even fuel oil in some cases.

In 2013, the GCC genset market saw revenues of $1 - 1.1bn and is expected to see growth of around 7% per year until 2020, according to analysts at Frost & Sullivan.

“From a power rating perspective, gensets in the range of 15 - 75 kVA constitute the largest chunk of the market, commanding more than 60% of the total GCC Diesel Genset market,” says Abhay Bhargava, associate director and regional head-energy & environment practice, Middle East and North Africa, Frost & Sullivan.

“The main segments that these gensets see application in are telecommunications, small offices and construction sites for compressors and pumps. While in other countries this range of gensets also sees extensive application in the residential and agricultural sectors, this is not applicable in the GCC.

“From a revenue perspective, however, the most commanding position in the GCC diesel genset industry is occupied by the 1500 - 3000 kVA range of gensets.

“These gensets are used in some of the critical applications that form a large chunk of the GCC’s non-oil & gas growth story, including large process industries, airports, manufacturing units, shopping malls, desalination plants and sewage treatment plants.

Rising demand
The two major factors driving growth in the GCC, says Bhargava, are growing demand from construction and industrial activities, both of which are seeing large demand in the GCC. However covering for power shortages has also become an important driver for the industry.

“In the GCC, we see issues in meeting peak demand predominantly in the summer months. At such times, many utilities resort to utilising diesel gensets to cater to the escalating demand,” says Bhargava. Genset maker FG Wilson, says regional demand growth has taken off again in recent years and expects that to continue for the foreseeable future.

The company’s products range from 6.8 – 2,500 kVA, including open and enclosed generator sets providing prime and standby power – from standby domestic use, right up to power modules with the ability to operate as complete power stations supplying electricity to national grids.

“In the last 18 months, FG Wilson generator sets have been installed to help power the iconic Basra Sports City, an $800mn multi-purpose sports complex which is one of the largest developments of its kind in the Middle East, as well as Cairo Festival City in Egypt,” says Stephen McKinty, general manager of FG Wilson.

“After a slowdown in demand post-2008 we are seeing demand increasing again as investment returns to the region, with many development projects recommencing. Key highlights recently have been the awarding of the FIFA World Cup 2022 to Qatar and Expo 2020 to Dubai.

“It is expected that there will be significant infrastructure demands such as expansion to current metro and road networks, and also the construction of hotels and recreational facilities to host both of these huge, global events.

“There will be high demand for quality, reliable generator sets in the construction and stand-by requirement for these new projects - we believe that FG Wilson can successfully meet these demands through our dealer network.”

Sweden-based Atlas Copco has a range of diesel-driven, sound attenuated portable generators offering output from 14kVA to 1250kVA. These are available in three product ranges (QAX, QAS and QAC), all of which are designed to withstand frequent movement and the harsh environments in the Middle East.

“The enclosed canopy of our generators allows an almost “silent” running which is very important if you consider that these kind of generators can run a full day on a construction site or close to a residential area or hosplital,” says Mohammad Abdelqader, regional product manager APE (Atlas Copco Portable Energy) division.

“A premium resale value is another reason why rental companies chose Atlas Copco. They usually have a policy of renewing their fleet faster than normal and the high resale value gives them a stronger business case and lower lifecycle cost. Longer service intervals and an ease of maintenance further reduces the total cost of operation.

“A main driver for the growth in demand for rental generators is still the construction industry, however the lag in infrastructure and re-infrastructure of some rapidly expanding cities and industrial areas and remote areas continues to offer a strong demand for our products,”

“You can find our equipment on a growing number of major projects in the region such as the Qatar metro tunnelling project and the Al Jubail Industrial area in Saudi Arabia.”

Al-Futtaim Auto & Machinery Co. (FAMCO) is a local dealer for products made by Spanish manufacturer Himoinsa, which makes gensets from 3 to 3,000 kVA powered by a variety of engines. Adnan Dawood, regional general manager- marketing, says: “Himoinsa products are high quality products from a European manufacturer complying with European standards. Weather proof/sound proof generators and lighting towers are in high demand.

“The main driving force is construction projects where grid power is not available. Wherever reliability, service and durability is in demand we see HIMOINSA generators being called for.”

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