Natural Gas-Powered Electricity Generation Market on Track to Reach an Estimated USD 79 Billion by 2034, Projecting a 5.6% Annual Growth Rate
Global Natural Gas-Fired Electricity Generation Market Poised for Strong Growth
The Global Natural Gas-Fired Electricity Generation Market is projected to experience significant growth from 2025 to 2034. According to recent projections, the market is expected to reach USD 79.0 billion by 2034, growing from USD 26.9 billion in 2024 at a Compound Annual Growth Rate (CAGR) of 5.6%[1].
Sweet natural gas is the leading fuel source, contributing 56.2% to total electricity generation capacity[2]. This dominance is reflected in the market's segmentation, with sweet natural gas leading the By Source segment in 2024 with a 56.2% share[2].
The market plays a crucial role in stabilizing grids against short-term and seasonal demand swings[3]. Combined cycle technology, accounting for 67.9% of the market share globally, dominates the market[2]. Power plants with an output of 100-500 MW hold a 42.1% share in the overall generation capacity market[4].
The Distributed Natural Gas Fueled Generation Market is also expected to grow, reaching approximately USD 66.1 billion by 2034, growing from USD 10.8 billion in 2024 at a CAGR of 9.4% during this period[1]. This growth is driven by increasing electricity demand, the push for cleaner energy sources, and advancements in turbine technology, integration with hydrogen blends, and the adoption of alternative fuels like methanol[5].
Key factors contributing to this growth include rising electricity demand from sectors such as data centers, hospitals, and industrial/commercial applications requiring reliable and uninterrupted power supply[1]. Additionally, natural gas emits less CO₂ compared to coal or oil, aligning with global decarbonization efforts, which encourages natural gas adoption in power generation[1][2].
Technological and infrastructure advancements, including the integration of distributed generation with renewable sources like solar and smart grid technologies, enhance energy reliability and operational efficiency[1]. Government incentives and policies promoting clean and efficient power generation also support market expansion[1]. Urbanization and infrastructure development boost demand for decentralized and flexible power solutions[1].
The Asia-Pacific region led the Natural Gas-Fired Electricity Generation Market in 2024 with a 43.60% share and a value of USD 19.9 billion[6]. Other significant contributors to the market include the Industrial application, which led demand with a 56.8% contribution[7].
Notable developments in the market include Ansaldo Energia securing a contract in February 2024 to reconstruct the Almaty CHPP-3 in Kazakhstan, which can handle hydrogen blends of up to 40%[8]. BHEL also received an order in August 2024 to showcase methanol firing in a gas turbine at the 350 MW Kayamkulam Combined Cycle Power Plant in Kerala[9].
In summary, the market’s growth is underpinned by a combination of increasing energy demand, environmental considerations favoring natural gas, technological integration opportunities, and supportive regulatory frameworks[1][2]. The market is evolving as a key player in delivering cleaner, reliable, and efficient power.
[1] MarketsandMarkets [2] Grand View Research [3] IBISWorld [4] IBISWorld [5] IBISWorld [6] IBISWorld [7] IBISWorld [8] Ansaldo Energia [9] BHEL
In light of the growing demand for cleaner energy sources, the Finance industry might consider investing in the Energy sector's Natural Gas-Fired Electricity Generation Market, given its projections to reach USD 79.0 billion by 2034 [1]. The sports industry could also take note, as the advancing technology in natural gas power plants could offer an edge for cities hosting global sports events, such as the World Cup or Olympics, seeking reliable and sustainable energy. [1] [2]
