Generator Sets Market Report Scope & Overview:

Generator Sets Market was valued at USD 42.36 billion in 2025 and is expected to reach USD 99.86 billion by 2035, growing at a CAGR of 9.02% from 2026-2035. 

Global generator set market is growing due to increase in industrialization, urbanization, and infrastructure development. And the adoption is fueled by rising demand for backup power especially across commercial, residential and industrial spaces, increasing frequency of power outages and increasing data centre and health facilities. In addition, the introduction of new technologies such as hybrid and energy-efficient gensets along with diverse initiatives by the government to encourage sustainable energy solutions is projected to propel the market growth in upcoming years.

According to the U.S. Energy Information Administration (EIA), American electricity customers experienced an average of about 5.6 hours of power interruptions annually, affecting millions of households, highlighting the critical need for reliable backup power solutions like generator sets across residential, commercial, and industrial segments.

Generator Sets Market Size and Forecast

• Generator Sets Market Size in 2025: USD 42.36 Billion

• Generator Sets Market Size by 2035: USD 99.86 Billion

• CAGR: 9.02% from 2026 to 2035

• Base Year: 2025

• Forecast Period: 2026–2035

• Historical Data: 2022–2024

Generator Sets Market Trends

• Rising demand for reliable backup power across industrial, commercial, and residential sectors is driving the generator sets market.

• Growing adoption in construction, healthcare, data centers, and telecom infrastructure is boosting market growth.

• Expansion of power outages and unreliable grid supply in emerging economies is fueling deployment.

• Increasing focus on fuel-efficient, low-emission, and hybrid generator technologies is shaping adoption trends.

• Advancements in diesel, gas, and renewable-powered generator sets are enhancing performance and sustainability.

• Rising investments in critical infrastructure and disaster-resilient power solutions are supporting market expansion.

• Collaborations between generator manufacturers, EPC contractors, and technology providers are accelerating innovation and global adoption.

U.S. Generator Sets Market was valued at USD 8.63 billion in 2025 and is expected to reach USD 19.62 billion by 2035, growing at a CAGR of 8.56% from 2026-2035. 

The U.S. Generator Sets Market driven by the demand for uninterrupted backup power due to frequent power outage outbreaks in industries, commercial buildings and data centers along with the adoption of more sophisticated, energy-efficient and hybrid generator solutions in residential and industrial sectors.

Generator Sets Market Growth Drivers:

• Growing industrialization and urbanization across developing regions drive strong demand for high-capacity generator sets solutions

In Asia-Pacific, Africa and Latin America, industrial expansion and growing urban population causing electricity shortage as the grid capacity has already reached its limit. Frequent unreliability or intermittent power supply makes most of the factories, hospitals and commercial facilities to use high capacity gensets. More residential complex, datacenter, or industrial plant construction equal onsite power demand. Moreover, continuous technological advancements in diesel & hybrid gensets with higher efficiency, lower emissions, & automation functionalities are also supporting the market growth. Hence, the persistent growth of industrial and urban power consumption, remained the Primary driver for the world generator sets market.

• According to the International Energy Agency (IEA), approximately 730 million people worldwide lacked access to electricity in 2024, with the largest gaps in Sub‑Saharan Africa and parts of Asia, highlighting ongoing reliability and infrastructure challenges.

• In Sub‑Saharan Africa, many regions experience daily outages of 6–12 hours during peak demand periods due to insufficient grid capacity.

• In Ecuador, severe droughts and underinvestment in generation capacity have led to prolonged blackouts of up to 14 hours per day, driving households and businesses to adopt reliable backup power solutions, including generator sets.

Generator Sets Market Restraints:

• Stringent environmental regulations and emission norms hinder expansion of traditional diesel and gas generator sets

Strict emission norms are being enforced by the Governments across the globe to reduce the emission pollution from diesel & gas engines. However, in order to meet these guidelines, equipment must be upgraded, cleaner fuels must be used or more sophisticated exhaust treatment systems need to be added, all of which contribute to increased costs. Where regulations are not being met or there are penalties or restrictions to their use, businesses are also being discouraged from utilizing traditional generator sets in some places. In addition, the necessity to improve environmental health and create higher levels of awareness to prevent fossil fuel promoting provides a further need for organizations to adopt renewable or hybrid energy sources. These all enchaining factors, to stiilx, limits the vertical growth of market and occasionally limit the market reach of conventional generator sets and rate of total market progress in few geographies.

• For instance, in the United States, the EPA Tier 4 emission standards for non-road diesel engines including many diesel gensets require approximately 90% reduction in particulate matter (PM) and about 50% reduction in nitrogen oxides (NOx) compared with older tiers, necessitating advanced engine and after-treatment systems.

• Similarly, the European Union enforces Stage I–V emissions standards for non-road mobile machinery, with Stage V being among the most stringent globally, limiting PM, NOx, and hydrocarbons across a wide range of power categories, adding regulatory and technological challenges for traditional generator sets.

Generator Sets Market Opportunities:

• Integration of renewable energy technologies with generator sets opens new market avenues for hybrid power solutions

There is a massive growth potential for hybrid generator sets that are either diesel or gas-powered, as well as solar or battery storage systems. These systems are always grid-connected and, can provide a continuous power supply with lower fuel consumption and emissions that are aligned with sustainability objectives. Collecting adoption in commercial buildings, hospitals, information center, and remote areas creates scope for products providing modern day solutions. Moreover, favourable government incentives for renewable integration along with green energy policies are promoting hybrid genset adoption. Companies also gain new technologies in areas like energy storage, automation, smart monitoring, etc., to tap into new market segments.

Leading Companies Offering Hybrid and Renewable-Integrated Generator Sets

Generator Sets Market Segment Highlights

• By Fuel Type, Diesel dominated the Generator Sets Market with ~73% share in 2025; Hybrid fastest growing (CAGR).

• By Application, Industrial dominated the Generator Sets Market with ~45% share in 2025; Residential fastest growing (CAGR).

• By Type, Low Power Gensets dominated the Generator Sets Market with ~38% share in 2025; Medium Power Gensets fastest growing (CAGR).

• By Sales, Dealer dominated the Generator Sets Market with ~45% share in 2025; Online fastest growing (CAGR).

Generator Sets Market Segment Analysis

By Fuel Type, Diesel segment dominates the Market, Hybrid segment expected to grow fastest

Diesel dominated the market in 2025 as they are easily accessible and regarded as the most suitable type of fuel available for any industrial and/or commercial use, as they are also highly reliable and space-efficient. They are offers consistent energy output, inexpensive than gas for operations and run out to be excellent for areas with inconsistent grid service which is favored over mass productions.

Hybrid are expected to grow fastest from 2026 to 2035 as it combines diesel or gas engines with renewable energy sources like batteries and solar. This integrated solution mitigates fuel-related expenses and reduces emissions while facilitating sustainability targets and is suitable for commercial and residential end users searching for the most economical and reliable emissions-free energy in an era where the green energy narrative is witnessing a global push.

By Application, Industrial applications dominate the Market, Residential applications expected to grow fastest

Industrial applications dominated the market in 2025 owing to the continuous demand of high power in manufacturing, data center, hospital and commercial facilities. Due to loss of power, which results in stops of work and violation of safety standards, uninterrupted power is imperative for industrial units which provides maximum power backup, hence increased demand of industrial generator set is expected over all large-scale energy-intensive operations globally.

Residential applications are expected to grow fastest from 2026 to 2035 driven by increased urbanization, persistent power outages, as well as rising requirement for house backup systems. Compact size, silent operations, easy installation and affordability of residential gensets has ensured uninterrupted power for homes, mostly for the underserved regions with lack of continuous electric supply and is a huge potential market for small gensets in such regions.

By Type, Low Power Gensets dominate the Market, Medium Power Gensets expected to grow fastest

Low power gensets dominated the market in 2025 due to their inexpensive and mobility features, making them use in small-scale industries, home & dwellings, and remote places. DMFC are well utilized for backup power requirements due to its compact size, simple installation, and economical operational cost contributing to substantial market share.

Medium power gensets are expected to grow fastest from 2026 to 2035 as rising commercial buildings, few industrial establishments, and healthcare stations will benefit from small-scale, sustainable power solutions. Base gensets for a diverse and growing range of mid-sized energy demand applications across the globe, Mid & high power gensets offer an improved base capacity compared to low power units at a very competitive price, ensuring reliability, and a plug & play solution.

By Sales, Dealer channels dominate the Market, Online channels expected to grow fastest

Dealer channels dominated the market in 2025 owing to the distribution network, local presence and after sales, guaranteeing installation, maintenance and warranty support that go hand in hand with these entities. Direct Access to Customers Between Different Industrial, Commercial, and Residential Segments by Dealers has Made this Channel Preferred for Procurement of Generator Sets, thus Contributing High Revenue Share.

Online channels are expected to grow fastest from 2026 to 2035 as e-commerce platforms offer convenience, competitive pricing, and a significantly larger selection of items. Increasing digital adoption, growth in contactless purchasing trends and availability of specifications and brands comparison over internet is drawing the interest of residential as well as small commercial buyers towards online platform which is propelling the sales of generator sets at a rapid pace.

Generator Sets Market Regional Analysis

North America Generator Sets Market Insights

North America held a major share in the Generator Sets Market in 2025 owing to high levels of industrialization and commercial infrastructure combined with high demand for reliable backup power. The growth is owing to the presence of major companies, advanced technological solutions, as well as regulations for uninterrupted power supply. Additionally, North America is a key region sustaining steady market growth in the global generator sets market, particularly due to increasing investments in data centers, healthcare, and fallback domestic solutions.

Asia Pacific Generator Sets Market Insights

Asia Pacific dominated the Generator Sets Market with the highest revenue share of about 41% in 2025 owing to the industrialization, urbanization, and infrastructure development in emerging economies like China, India and several Southeast Asian countries. The growth in the adoption of gensets due to regular power cuts, increase in the construction activities, and the escalation of the demand for backup power in the commercial, residential, and industrial areas explain the potential for the growth of our market.

Europe Generator Sets Market Insights

Europe held a significant share in the Generator Sets Market in 2025, due to the stringent mandates for power reliability, and emission Standard. The industries and commercial businesses along with critical infrastructure are having to face the high degree of demand for backup power, which is why higher adoption is driven by. Other drivers boosting growth of Europe Generator Sets Market include technological developments, growing demand for energy-efficient gensets and growing spending on hybrid and renewable-integrated generator solutions.

Middle East & Africa and Latin America Generator Sets Market Insights

The Middle East & Africa held a notable share in the Generator Sets Market in 2025 due to power cut occurrences, rapid industrial growth, and increasing infrastructure development throughout the region in Middle East & Africa. The inhospitable climatic conditions even at construction sites, coupled with the fact that many projects will be situated at remote locations, will help drive demand for gensets. Similarly, generator set growth across both regions was driven by Latin America, underpinned by urbanization, rising requirements for industrial and commercial power, and back-up power demands.

Generator Sets Market Competitive Landscape:

Cummins Inc.

Cummins Inc. is a global leader in power solutions with a rich portfolio of diesel technology, natural gas, hybrid, and electric engines, generator sets, and energy storage. The company provides reliable, efficient and sustainable power solutions for commercial, industrial and utility markets around the world. Cummins is deeply engaged within the adaptation of traditional energy systems with digital and modern AI-enabled with controls that enables automatic energy management, peak shaving and resilience to facilities that are directly aligned with decarbonization as well as renewable spanning sectors.

• 2025: Cummins partnered with Exergy Energy, LLC to deploy generator sets, energy storage, and switching solutions that automatically manage facility power without upfront CAPEX.

Generac Holdings Inc.

Generac Holdings is a leading global provider of backup power solutions and other power products consisting of residential, commercial, and industrial power products along with energy storage and microgrid systems headquartered in the U.S. Power systems capable of working on renewable as well as fossil-fuel based fuels for residential, commercial, and data centers applications. From IoT and remote monitoring to hybrid energy solutions, with a global portfolio, Generac enables companies and consumers to help power energy resilience, renewable integration and critical infrastructure protection worldwide.

• 2025: Generac unveiled the most powerful air-cooled home standby generator, expanding its 10–28 kW range with full integration into its energy ecosystem.

• 2025 (Apr): Generac introduced high-capacity standby generators (2.25–3.25 MW) targeting hyperscale, colocation, enterprise, and edge data center applications.

• 2023: Generac launched the GP7500E Dual Fuel portable generator, offering gasoline or propane operation for enhanced home and outdoor backup flexibility.

Caterpillar Inc.

Caterpillar Incorporated is one of the world leaders in construction and mining equipment, industrial engines, and power systems. With its line of generator sets, it offers dependable standby, prime, and continuous power solutions in commercial, industrial, and utility markets. Caterpillar gets right into the heart of the matter, highlighting fuel efficiency, emissions [and] sustainability, and heavy integration of AI-enabled digital monitoring and controls to help optimize energy consumption. The Cat generator sets and industrial engines that power those critical infrastructure, renewable integration and decarbonization projects.

• 2023: Caterpillar announced high-efficiency natural gas generator sets (350–500 kW) with improved fuel efficiency, emissions, and power density for standby and demand response.

• 2024: Caterpillar invested $90 million to prepare facilities for new industrial engine production, including C13D engines starting in 2026.

Key Players

Some of the Generator Sets Market Companies

• Cummins Inc.

• Generac Holdings Inc.

• Caterpillar Inc.

• Rolls‑Royce Power Systems (MTU Onsite Energy)

• Kohler Co.

• Atlas Copco AB

• Briggs & Stratton Corporation

• AKSA Power Generation

• Doosan Corporation / Doosan Enerbility

• Wärtsilä Corporation

• Yanmar Holdings Co., Ltd.

• Honda Motor Co., Ltd. / Honda Power Equipment

• Mitsubishi Heavy Industries Ltd.

• FG Wilson (Caterpillar brand)

• HIMOINSA S.L.

• Perkins Engines Company Ltd.

• Siemens Energy AG

• Aggreko Plc

• Cooper Corporation

• Greaves Cotton Limited