The genset demand is expected to follow the growth trajectory in 2022.
Mandar Deo Vice President, Power Systems, Cummins India What are the market dynamics and potential for gensets used in a range of applications such as mining, oil & gas, telecom, construction, datacenter, and
– Mandar Deo
Vice President, Power Systems, Cummins India
What are the market dynamics and potential for gensets used in a range of applications such as mining, oil & gas, telecom, construction, datacenter, and healthcare sectors?
The year 2020 was one of the toughest years in India and globally when our economy and business activity came to a standstill for nearly two quarters. The pandemic induced nationwide lockdown impacted the business growth across all industry verticals. At a state level, phased reopening for resumption of economic activity added to the complexity of conducting business. However, few segments in the genset business experienced demand in 2020 such as healthcare (Covid-19 readiness centers establishment, expansion and/or upgradation of existing health facilities), IT, particularly Datacenters (work from home as the prevalent model prompted organisations to advance and enhance server capacities), agriculture (for storage, processing, and other support functions) and rental infrastructure (customers deferring capex investment to save cost).
Despite the impact of second wave, 2021 heralded optimism for the genset business, which experienced a remarkable recovery with demand reaching nearly 95% of the pre-Covid 19 levels of 2019. Most industry sectors, barring hospitality, and travel observed a significant uptick in demand in the very first quarter of 2021.
Gazing into the future, the genset demand is expected to follow the growth trajectory in 2022. This demand will be driven by the increasing consumption, progress in vaccination rates, and the need for uninterrupted power supply for robust and sustainable economic growth. Datacenter is one of the key segments witnessing a strong double-digit growth with global companies investing hugely in building capabilities in India. Alongside, infrastructure, manufacturing, realty, healthcare, and rental will continue to bolster the growth and demand for gensets in 2022.
How do you see the growth of hybrid systems and how prepared are you to meet the demand surge?
The diesel powered genset will continue to retain its position as the primary product in the power backup segment across industry sectors for the foreseeable future. This is due to the ease of availability, maintenance, familiarity with the products and reduced run hours. With steady product improvements such as enhancement of fuel efficiency, carbon footprint reduction, remote monitoring devices and cleaner exhaust, the diesel genset remains a preferred choice for power backup across sectors. While alternative sources of energy and hybrid models are gaining traction in the Indian, industrial, and power backup market, their mass adoption would be heavily dependent on automotive segments transitioning to newer and renewable sources of power.
In line with our vision of innovating for our customers to power their success, Cummins has globally invested in alternate fuels, fuel cells, batteries, and electrolysers to lower emissions and harness the green technologies. As a global technology and power leader, we endeavour to deliver the near-term future of power as well as the medium to long-term next generation of power. Cummins in India is committed to focus on strengthening our core product portfolio and adjacencies while expanding to new business frontiers.
What are the technological and innovative trends in your range of gensets?
Cummins India’s Power Generation business offers customers the end-to-end range of gensets with assurance of aftermarket support. Our product range varies from 7.5 kVA to 3,750 kVA. The power generation market is expected to undergo significant shifts in the coming months.
The diesel genset segment is gearing up for the next CPCB-IV+ (Central Pollution Control Board – IV) emission norms, driving greener products, applicable on nodes up to 910 kVA. These norms are more stringent than the global Tier 4F norms for certain nodes, aimed at nearly 90% reduction in the CO, NOx, and PM from the previous emission guidelines. For the new norms, Cummins India is investing heavily in the development of robust, competitive, safe, and compliant products.
In 2021, Cummins India Power Generation business has developed and demonstrated capabilities to manufacture the largest genset in India – powered by Quantum 60 litres engine – delivering 2,500 kVA DCC and 2,750 kVA Standby. Our key area of focus will be on datacenter and commercial realty customers.
How do you assess the rental market for gensets?
With the recovery of demand this year, rental has emerged as a growing segment. With customers opting to defer the investment in a new asset, rental demand has increased over the last one year.
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