According to the UnivDatos Market Insights analysis, The Captive Power Plant Market was valued at USD 29.64 Billion in 2023 and is expected to grow at a strong CAGR of around 11.13% during the forecast period (2024-2032). The captive power plant market across the world has shown regional differences in the type of development, commissioning of the project, and the policies that have been formulated or implemented concerning the usage or generation of captive power plants. These variations are thus propelled by industrial requirements, energy systems, and structures and regulations. This blog covers an analysis of the captive power plant market in terms of region and covers recent trends, plants commissioned in the past three years, and government policies.

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Asia-Pacific

The Asia-Pacific region is likely to show the most potential growth for the captive power plant market, now and shortly. The need for a steady power supply to industries, especially in manufacturing regions has led to the popular use of captive power.

Projects Commissioned:

Reliance Industries: Thus, Reliance Industries linked a 500 MW power plant of captive solar power in Jamnagar, India in December 2021. This project seeks to supply its petrochemical complex to cut the use of conventional power sources.

Tata Power: Tata Power Co also commissioned a 200 MW solar captive power plant at Kohma, Maharashtra in February 2022 to provide power to its clients in industries to cut out the middleman for efficient generation of electricity.

Government Policies:

India: The Indian government has put into place several policies that seek to encourage the use of captive power plants. In the National Solar Mission, the government provides financial support in the form of incentives and grants along with facilitating the process of permitting solar captive power projects. Thus, in 2022 the MNRE decided to promulgate a policy that enters for captive Solar Power Plants with a 30% subsidy on the capital cost.

North America

North America especially the United States is experiencing a shift towards more renewable energy-based captive power plants. The emphasis is placed on the limitation of carbon dioxide releases and the improvement of energy self-sufficiency.

Projects Commissioned:

Apple: Apple commissioned a 100 MW solar captive power plant in September 2021 in North Carolina, the USA. This plant provides renewable energy that supports Apple’s data centers, which is in tune with its renewable goal.

Amazon: The 50 MW wind captive power plant was ordered in March 2022 in Texas, USA by Amazon. Some of the goals of this project are in line with Amazon’s idea of running its operations on renewable energy.

Government Policies:

United States: The Federal Energy Regulatory Commission or FERC has put measures in place to ensure the integration of DERs such as captive power plants. The SGIP program located in California motivates companies to incorporate renewable energy-based captive power systems. As of 2023, it raised its budget to one billion to enable it to fund more projects.

Europe

Europe is focusing on renewable energy and energy efficiency in the captive power plant market. The region's stringent environmental regulations drive the adoption of sustainable energy solutions.

Projects Commissioned:

Siemens: In November 2021, Siemens commissioned a 150 MW wind captive power plant in Germany to supply power to its manufacturing facilities. This project is part of Siemens' strategy to achieve carbon neutrality by 2030.

Nestlé: In January 2022, Nestlé commissioned a 100 MW biomass captive power plant in France, reducing its reliance on fossil fuels and enhancing energy sustainability.

Government Policies:

Germany: The German government offers subsidies and tax incentives for renewable energy projects, including captive power plants. In 2022, the Renewable Energy Sources Act (EEG) was amended to provide higher feed-in tariffs for captive renewable energy projects.

France: France's Energy Transition Law, updated in 2023, includes provisions to support the development of biomass and other renewable energy-based captive power plants through financial incentives and streamlined regulatory processes.

Middle East and Africa:

The Middle East and Africa region is leveraging captive power plants to address energy security and reliability issues, particularly in remote and industrial areas.

Projects Commissioned:

Saudi Aramco: In June 2022, Saudi Aramco commissioned a 250 MW gas-based captive power plant in Dhahran, Saudi Arabia. This plant ensures a reliable power supply for its industrial operations.

Dangote Group: In April 2021, Dangote Group commissioned a 150 MW gas-fired captive power plant in Nigeria to power its cement manufacturing facilities, enhancing operational efficiency.

Government Policies:

Saudi Arabia: The Saudi government, under its Vision 2030 plan, is promoting the development of captive power plants, particularly those based on natural gas and renewable energy. In 2022, the government announced a policy to provide financial support and regulatory ease for such projects.

Nigeria: The Nigerian government introduced the National Renewable Energy and Energy Efficiency Policy (NREEEP) in 2021, which includes incentives for the development of captive power plants. The policy aims to increase the share of renewable energy in the country's energy mix, offering tax breaks and subsidies for relevant projects.

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Conclusion

The captive power plant market is growing at a fast pace across the globe due to some regional indices, commissioning of projects and favorable regulation measures. Stakeholders are embracing capital-intensive facilities in renewable energy and newer technologies to improve energy efficiency. This paper has shown that policies as well as incentives are key factors that can influence the development of captive power plants, especially those relying on renewable sources of energy. Therefore, based on the need of industries to secure efficient and cheap energy sources the captive power plant market is expected to grow and develop further across various worldwide regions.

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