Hydropower Turbine Market - Global Industry Size, Share, Trends, Opportunity, and Forecast, Segmented By Type (Reactive, Impulse, Gravity, Others), By Capacity (Less than 1 MW, Between 1 - 10 MW, Above 10 MW), By Application (Power Generation, Power Storage, Marine, Aeronautics), By Region, By Competition, 2018-2028

Market Overview

Global Hydropower Turbine Market was valued at USD 2.57 billion in 2022 and is anticipated to project robust growth in the forecast period with a CAGR of 4.40% through 2028. The hydropower turbine market refers to the sector within the global energy industry that focuses on the design, manufacturing, installation, and maintenance of turbines specifically engineered for the generation of electricity from the kinetic energy of flowing water. These turbines are integral components of hydropower plants, which harness the energy of moving water, such as rivers, dams, and waterfalls, to produce electrical power. Hydropower turbines are essential in the process of converting the mechanical energy of water into electrical energy. They come in various types, including Francis, Pelton, and Kaplan turbines, each tailored for specific water flow conditions and head levels. The market encompasses a wide range of stakeholders, including turbine manufacturers, engineering firms, utilities, and government agencies involved in the planning, regulation, and promotion of hydropower projects.

Key Market Drivers

Renewable Energy Transition and Environmental Concerns

The global push for renewable energy sources in the face of climate change and environmental degradation has become a significant driver of the hydropower turbine market. With increasing awareness of the detrimental effects of fossil fuels, governments, businesses, and individuals are seeking cleaner energy alternatives. Hydropower stands out as one of the most established and reliable renewable energy sources, providing a steady and consistent supply of electricity without carbon emissions or pollution. This growing emphasis on sustainability and reducing greenhouse gas emissions is propelling investments in hydropower projects worldwide.

Hydropower's environmentally friendly attributes align with global efforts to combat climate change, and its reliability ensures a stable energy supply, making it an attractive option for governments and utilities looking to reduce their carbon footprints.

Energy Security and Reliability

Energy security and reliability are critical concerns for nations around the world. Unstable energy sources, such as wind and solar, can be intermittent and weather-dependent, which makes grid stability a challenge. In contrast, hydropower provides a consistent and reliable source of electricity, making it an essential driver in the global energy landscape. Hydropower plants can respond quickly to fluctuations in demand, making them valuable assets for grid stability and energy security.

As countries seek to reduce their dependence on imported fossil fuels and enhance their energy resilience, investments in hydropower turbines and infrastructure continue to rise.

Infrastructure Modernization and Rehabilitation

Many existing hydropower facilities around the world are aging and in need of modernization or rehabilitation. This presents a significant driver for the global hydropower turbine market. Governments and utilities recognize the potential to enhance the efficiency, capacity, and lifespan of these facilities by upgrading their turbine systems.

Modern turbine technologies offer improved efficiency, greater power generation, and reduced maintenance costs. Thus, the need to refurbish and upgrade older hydropower plants is boosting demand for new hydropower turbines and associated equipment.

Growing Urbanization and Energy Demand

Rapid urbanization and population growth are driving up global energy demand. As more people move to cities and economies expand, the need for electricity continues to grow. Hydropower is uniquely positioned to meet this escalating demand due to its ability to provide a stable and substantial energy supply.

Emerging economies are particularly keen on harnessing hydropower to support their expanding industrial and residential needs. As a result, investments in new hydropower projects and turbines are on the rise.

Government Incentives and Policies

Government policies and incentives play a pivotal role in shaping the growth of the hydropower turbine market. Many countries offer financial incentives, subsidies, and favorable regulatory frameworks to encourage the development of hydropower projects. These policies can include feed-in tariffs, tax credits, and grants, which attract private sector investments and drive market expansion.

Additionally, governments may set renewable energy targets and emissions reduction goals, further incentivizing the adoption of hydropower as a clean and sustainable energy source.

Technological Advancements and Innovation

Advancements in turbine technology and innovation are transforming the hydropower industry. New turbine designs, materials, and control systems are enhancing efficiency and performance while reducing environmental impacts. Miniaturization and modularization of turbines are making smaller-scale hydropower projects more feasible and cost-effective.

Moreover, the integration of digital technologies, such as predictive maintenance and remote monitoring, is optimizing the operation and maintenance of hydropower turbines, minimizing downtime and maximizing energy output.

In conclusion, the global hydropower turbine market is being driven by a combination of factors, including the renewable energy transition, energy security concerns, infrastructure modernization, urbanization, government policies, and technological advancements. As the world continues to prioritize clean and sustainable energy sources, the demand for hydropower turbines is expected to remain strong in the coming years.

Government Policies are Likely to Propel the Market

Renewable Portfolio Standards (RPS)

Renewable Portfolio Standards, commonly known as RPS or Renewable Energy Standards (RES), are government policies that mandate a certain percentage of electricity generation to come from renewable sources, including hydropower. These standards vary by country and region but typically require utilities to produce a specified portion of their electricity from renewable sources by a certain target year.

RPS policies create a strong incentive for the development of hydropower projects, as they provide a guaranteed market for renewable energy. They encourage the growth of the hydropower turbine market by ensuring a consistent demand for hydropower-generated electricity. To meet these standards, utilities often invest in the construction and upgrading of hydropower plants, leading to increased demand for hydropower turbines and related equipment.

Additionally, RPS policies drive innovation in the hydropower industry by encouraging the adoption of more efficient and environmentally friendly turbine technologies to meet renewable energy goals.

Investment Tax Credits (ITC) and Production Tax Credits (PTC)

Investment Tax Credits (ITC) and Production Tax Credits (PTC) are fiscal incentives provided by governments to promote the development of renewable energy, including hydropower. These policies offer financial incentives to investors, developers, and operators of hydropower projects.

The Investment Tax Credit provides a direct reduction in the income tax liability of those investing in hydropower projects. This tax credit can significantly lower the overall project costs, making hydropower investments more attractive to private investors.

Production Tax Credits, on the other hand, offer a per-kilowatt-hour tax credit for the electricity generated by qualified renewable energy facilities, including hydropower plants. These credits provide ongoing financial support for the operation of hydropower projects, ensuring their long-term viability.

Both ITC and PTC policies stimulate investment in the hydropower turbine market by reducing the financial burden on project developers and investors. This encourages the construction of new hydropower facilities and the modernization of existing ones.

Environmental Regulations and Permitting

Government regulations and permitting processes significantly impact the hydropower turbine market, particularly concerning environmental considerations. Hydropower projects often involve the construction of dams, which can have environmental and ecological implications. Therefore, governments establish stringent regulations and permitting requirements to ensure that hydropower developments are conducted responsibly and sustainably.

Environmental impact assessments, fish passage requirements, and water quality standards are some of the key components of these regulations. Compliance with these regulations often necessitates the installation of advanced turbine technologies and fish-friendly designs, which drive innovation in the hydropower industry.

While these regulations can add complexity and cost to hydropower projects, they also help ensure the long-term sustainability of the industry. Governments may offer incentives or streamlined permitting processes for projects that meet high environmental standards, further incentivizing the use of advanced hydropower turbines and responsible project development.

Research and Development Funding

Government funding for research and development (R&D) in the hydropower sector plays a crucial role in advancing turbine technologies and increasing the efficiency of hydropower generation. Governments often allocate budgets to support R&D initiatives aimed at enhancing the performance, reliability, and environmental sustainability of hydropower turbines.

R&D funding can be directed towards various aspects of hydropower technology, including materials research, turbine design, and control systems. These investments lead to the development of cutting-edge turbine technologies that can increase energy output, reduce maintenance costs, and minimize environmental impacts.

Additionally, government-funded research projects often involve collaboration between academia, industry, and government agencies, fostering innovation and knowledge sharing within the hydropower turbine market.

Export Credit Agencies (ECAs) and International Support

Export Credit Agencies are government entities that provide financial and risk mitigation services to domestic companies engaged in international trade and investment. In the context of the hydropower turbine market, ECAs can play a pivotal role in supporting the export of domestically manufactured turbines to foreign markets.

Many governments offer support through their ECAs to promote the export of renewable energy technologies, including hydropower turbines. This support may include financing options, insurance against political and commercial risks, and assistance with market entry strategies.

By facilitating the export of hydropower turbines, governments can boost the domestic manufacturing sector, create jobs, and expand the global reach of their hydropower industry. This policy encourages turbine manufacturers to invest in research and development, quality control, and competitiveness in the global marketplace.

Renewable Energy Subsidies and Incentive Programs

Renewable energy subsidies and incentive programs are critical government policies that directly impact the hydropower turbine market. These programs are designed to reduce the financial barriers associated with hydropower project development and encourage the adoption of renewable energy.

Subsidies may include grants, low-interest loans, or direct financial incentives for the construction and operation of hydropower plants. Incentive programs often provide financial rewards for each unit of electricity generated from renewable sources, such as feed-in tariffs, which guarantee a fixed payment per kilowatt-hour of hydropower electricity produced.

These policies stimulate investment in hydropower projects by making them more economically viable. They create a predictable revenue stream for project developers and operators, which, in turn, drives demand for hydropower turbines and encourages the expansion of hydropower capacity.

In conclusion, government policies have a profound impact on the global hydropower turbine market. Renewable Portfolio Standards, tax incentives, environmental regulations, research funding, export support, and subsidies all play crucial roles in shaping the growth, innovation, and sustainability of the hydropower industry worldwide. These policies are essential drivers for meeting renewable energy goals and mitigating climate change through the adoption of clean and sustainable hydropower technologies.

Key Market Challenges

Environmental and Ecological Concerns

The global hydropower turbine market, while crucial for sustainable energy generation, is not without its challenges. One of the most significant challenges pertains to environmental and ecological concerns associated with the construction and operation of hydropower projects.

Environmental Impact on Waterways

Hydropower projects typically involve the construction of dams and reservoirs to regulate water flow, which can have a range of environmental impacts. Large dams can disrupt natural river ecosystems, altering the flow of sediment and nutrients downstream, and potentially harming aquatic life. The creation of reservoirs often results in the flooding of land, which can displace local communities and affect terrestrial ecosystems. Additionally, changes in water temperature and flow can impact the breeding and migration patterns of fish, potentially leading to declines in fish populations.

Mitigation Efforts

Addressing these environmental concerns requires careful planning and mitigation measures. Fish-friendly turbine designs, such as fish-friendly turbines and fish ladders, are being developed and implemented to facilitate fish passage and reduce the impact on aquatic life. Additionally, environmental impact assessments and thorough monitoring are critical components of responsible hydropower project development.

Sustainability and Licensing Challenges

The approval and licensing of hydropower projects can be time-consuming and challenging due to the need to demonstrate environmental sustainability. Some projects may face opposition from environmental groups and local communities concerned about the potential harm to ecosystems. Balancing the need for clean energy with environmental protection is an ongoing challenge for the industry.

Aging Infrastructure and Rehabilitation Needs

Another significant challenge in the global hydropower turbine market is the aging infrastructure of existing hydropower facilities and the associated need for rehabilitation and modernization.

Aging Hydropower Infrastructure

Many hydropower facilities around the world were constructed several decades ago and are now showing signs of aging. As these facilities deteriorate, they become less efficient and more costly to maintain. Outdated turbine technologies may result in lower energy output, higher maintenance costs, and reduced reliability.

Modernization Requirements

To address this challenge, governments and hydropower operators must invest in the modernization and rehabilitation of existing facilities. This often involves upgrading turbines, control systems, and other components to improve efficiency and reliability. Modernization efforts may also focus on enhancing environmental performance, such as implementing fish-friendly turbine designs and improving water management practices.

Financial and Technical Challenges

Modernization projects can be complex and costly, presenting financial and technical challenges. Funding such projects can be a barrier, especially for older facilities that may not have generated revenue to support ongoing maintenance and upgrades. Additionally, retrofitting older facilities with advanced turbine technology may require significant engineering and technical expertise.

Balancing Preservation and Upgrades

Another challenge is striking a balance between preserving the historical and cultural value of older hydropower facilities and the need for technological upgrades. Some older dams are considered historical landmarks, and their preservation is important, but this must be done while ensuring their continued functionality and compliance with modern environmental standards.

In conclusion, the global hydropower turbine market faces challenges related to environmental and ecological concerns, as well as the aging infrastructure of existing hydropower facilities. Addressing these challenges requires a multi-faceted approach that includes responsible project development, mitigation measures, modernization efforts, and finding ways to balance the need for clean energy with environmental preservation. Overcoming these challenges is essential for the continued growth and sustainability of the hydropower industry as a reliable and clean source of electricity.

Segmental Insights

Type Insights

The Reactive (Reactive also known as Francis) segment held the largest Market share in 2022. Francis turbines are highly versatile and can operate effectively across a wide range of water flow rates and heads. This adaptability makes them suitable for a broad spectrum of hydropower projects, from low-head to high-head applications. Their flexibility in handling varying flow conditions is a significant advantage in regions with fluctuating water availability. Francis turbines are renowned for their efficiency. They can convert a significant portion of the kinetic energy from flowing water into electricity. This high efficiency is attractive to hydropower developers because it maximizes the energy output from a given water source, optimizing the return on investment. Francis turbines provide stable and predictable performance under varying load conditions. They can adapt to changes in water flow and load demand, making them reliable for continuous power generation. This stability is essential for maintaining grid reliability and meeting energy demand. Francis turbines have been in use for many decades and have undergone continuous improvement. Their design and manufacturing processes are well-established, leading to the production of high-quality and durable turbines. This maturity in technology contributes to their dominance in the market. The adaptability of Francis turbines allows them to be used in a wide range of geographic locations and climate conditions. They are found in various settings, from mountainous regions with high-head hydropower potential to river-based projects with lower heads. Francis turbines are often considered cost-effective due to their widespread use, mature technology, and efficiency. Their proven track record makes them an attractive choice for project developers looking to minimize risks and optimize project economics. Regulatory bodies and governments often have established guidelines and standards for hydropower projects. Francis turbines, being a well-understood and widely accepted technology, tend to receive regulatory approval more readily, simplifying the permitting and licensing process for projects.

Application Insights

The Power Generation segment held the largest Market share in 2022. Hydropower has been a reliable and proven source of electricity generation for over a century. It represents one of the oldest and most established forms of renewable energy. As a result, the infrastructure for hydropower generation, including dams, reservoirs, and hydropower plants, has been extensively developed, making it the leading application for hydropower turbines. Hydropower projects can be developed in a wide range of geographical locations, from high mountainous regions with significant heads to lowland river systems. This versatility means that hydropower resources are abundant in many parts of the world, contributing to its dominance in power generation. Hydropower turbines provide reliable and consistent electricity generation. Unlike some other renewable sources, such as wind and solar, which are weather-dependent and intermittent, hydropower can be controlled and dispatched as needed. This stability makes it an ideal source for baseload and peaking power generation, ensuring a steady supply of electricity. Hydropower turbines are known for their high efficiency in converting the kinetic energy of flowing water into electricity. They can achieve efficiency levels well above 90%, making them a cost-effective and energy-efficient choice for power generation. Once hydropower plants are constructed, their operating and maintenance costs are relatively low compared to fossil fuel-based power plants. This cost-effectiveness makes hydropower an attractive option for utilities and governments aiming to reduce electricity production costs. Hydropower is a clean and environmentally friendly source of energy. It produces no direct greenhouse gas emissions during operation and has a minimal environmental footprint compared to many other forms of electricity generation. This environmental advantage aligns with global efforts to combat climate change and reduce air pollution. Hydropower plants and their associated turbines have long lifecycles, often exceeding 50 years with proper maintenance. This long-term reliability and durability are attractive to investors and utilities seeking a stable and enduring source of electricity. Hydropower provides grid stability due to its ability to respond quickly to fluctuations in electricity demand. It can be used for load following, helping to maintain grid reliability and balance supply and demand. Many countries have untapped hydroelectric potential, meaning there are opportunities to develop new hydropower projects. As global energy demand continues to rise, governments and utilities are exploring the expansion of hydropower capacity. Many governments incentivize and promote hydropower as part of their renewable energy and environmental policies. Supportive regulatory frameworks, subsidies, and incentives encourage the development of hydropower projects for electricity generation.

Regional Insights

Asia-Pacific

The Asia-Pacific region is witnessing a growing demand for hydropower turbines from both developed and developing countries. The region is home to a number of large hydroelectric projects, and many more are under development. The key trends in the Asia-Pacific hydropower turbine market include

Increasing focus on renewable energy development.

Government initiatives promoting hydropower development.

Technological advancements in turbine designs and manufacturing processes

North America

The North American hydropower turbine market is expected to witness significant growth in the coming years, driven by the increasing focus on renewable energy development. The US government is investing heavily in hydropower development, and a number of new hydroelectric projects are under development in the country.

Europe

The European hydropower turbine market is expected to grow at a moderate pace in the coming years. The key trends in the European hydropower turbine market include

Increasing focus on renewable energy development

Refurbishment of existing hydropower plants

Development of new hydropower technologies

Recent Developments

• In September 2023, General Electric (GE) announced an investment of USD 100 million in its hydropower turbine manufacturing facility in China. This investment will help GE to expand its production capacity and meet the growing demand for hydropower turbines in the region.
• In August 2023, Voith announced an investment of USD 50 million in its hydropower turbine manufacturing facility in Brazil. This investment will help Voith to expand its production capacity and meet the growing demand for hydropower turbines in the Latin American region.
• In July 2023, Andritz announced an investment of USD 30 million in its hydropower turbine manufacturing facility in India. This investment will help Andritz to expand its production capacity and meet the growing demand for hydropower turbines in the Indian market.

Key Market Players

• General Electric Company
• Voith Group
• Andritz AG
• Siemens Energy AG
• Harbin Electric Corporation
• Dongfang Electric Machinery Co. Ltd
• Hitachi Ltd
• Mitsubishi Heavy Industries Ltd
• Toshiba Corp.
• GE Renewable Energy.