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Table Of Content
March 2025
The global microgrid market size is accounted at USD 51.40 billion in 2025 and is forecasted to hit around USD 236.18 billion by 2034, representing a CAGR of 18.52% from 2025 to 2034. The North America market size was estimated at USD 17.71 billion in 2024 and is expanding at a CAGR of 18.55% during the forecast period. The market sizing and forecasts are revenue-based (USD Million/Billion), with 2024 as the base year.
The global microgrid market size was calculated at USD 43.19 billion in 2024 and is predicted to reach around USD 236.18 billion by 2034, expanding at a CAGR of 18.52% from 2025 to 2034.
The U.S. microgrid market size was evaluated at USD 12.47 billion in 2024 and is projected to be worth around USD 71.10 billion by 2034, growing at a CAGR of 19.01% from 2025 to 2034.
On the basis of geography, North America is expected to continue to be among the most alluring markets, and this region accounted for the majority of revenue share in the market throughout the projection period. The area has gained popularity in the market because of the presence of multiple microgrid companies and government programs, such as the Smart Power Infrastructure Demonstration for Energy Reliability and Security (SPIDERS) program, to encourage the implementation of microgrids. In terms of microgrid development and capacity, North America dominated the microgrid industry in 2024. Numerous fossil-fueled commercial and industrial (C&I) microgrids are being built in North America as resiliency options. Moreover, the dependency of end users on utility systems to provide their energy demands has risen due to the rise in global population and increase in power consumption. By 2040, worldwide energy consumption is predicted to rise by over 56%, according to the U.S. Energy Information Administration (EIA). In addition, the demand for electricity is growing quickly and cannot be fully fulfilled by the main networks because of increased industrialization and urbanization. Hence, this region has a prominent scope in the forecast period.
The Asia Pacific is anticipated to be one of the most appealing regions, accounting for the significance of the market's revenue share throughout the course of the projection year. This is mostly caused by the area's low electrification rate, poor grid connectivity, and high demand for electricity. It is predicted that the Asia Pacific market would grow significantly during the forecast period, largely as a result of the region's quick industrialization and urbanization, particularly in China and India. Additionally, governments in Asia-Pacific nations intend to support distributed energy generation and microgrids in order to provide electricity to their citizens.
A microgrid is an energy system that runs concurrently with or independently from the main power grid and has linked loads and dispersed energy resources. To transfer power from producers to consumers, it mostly comprises fuel cells, battery storage systems, wind turbine generators and microturbines, and solar generators. It enhances the efficiency and stability of the electric grid, lowers peak loads, fuel consumption, and congestion, and boosts dependability and resilience. Microgrids may be coupled with a variety of renewable energy sources, including solar, small hydro, wind, waste-to-energy, geothermal, and combined heat and power systems since they are more efficient than conventional electrical networks. The global consumption of energy is rising as a result of increased construction activity in the residential and commercial sectors. This is one of the main drivers of market growth, coupled with rising public and private agency spending on infrastructure development projects. Furthermore, key businesses in the sector are benefiting financially from the growing emphasis on rural electrification.
In terms of local and national economic gain and improved efficiency, microgrids provide a number of advantages with the worldwide trend toward renewable energy sources to address climate change. A paradigm shift toward the usage of reliable, safe power production units and the ongoing advancement of cutting-edge technologies to provide resilient energy against grid instability are anticipated to complement the market picture.
| Report Coverage | Details |
| Market Size in 2025 | USD 51.40 Billion |
| Market Size in 2024 | USD 43.19 Billion |
| Market Size by 2034 | USD 236.18 Billion |
| Growth Rate from 2025 to 2034 | CAGR of 18.52% |
| Largest Market | North America |
| Fastest Growing Market | Asia Pacific |
| Base Year | 2024 |
| Forecast Period | 2025 to 2034 |
| Regions Covered | North America, Europe, Asia-Pacific, Latin America, and Middle East & Africa |
Microgrid usage for rural electricity is increasing rapidly
Technological developments in renewable energy
Government mandates to reduce carbon footprint
The centralized control segment held the largest share of 43.10% in the 2024 microgrid market. The centralized control in microgrids includes a central control over all components, decision-making, and the collection of data. This segment provides sufficient control to the operator but comes with a few challenges in communication and scalability for extended microgrids. The centralized control is like the brain of the microgrid, balancing the load and generation for stabilized frequency and voltage. It’s multiple roles balancing out energy management to its best, and calculated use empowers sustainability.
The peer-to-peer control (blockchain-enabled) segment is expected to grow at a CAGR of 16.70% during the forecast period. The blockchain-enabled peer-to-peer (P2P) control in the microgrid industry encompasses decentralization of energy trading between consumers and prosumers. This control uses intelligent contracts with a blockchain consideration for automation and protection of transactions, providing unique pricing, visibility in tracking of energy flow without any intermediaries. Whereas the technology is an additional benefit to the coting, renewable energy integration. This dual advantage is running strong in the development of the microgrids.
The hardware segment held the largest share of 61.70% in the 2024 microgrid market. The hardware components, like smart meters, inverters, energy storage systems, and power generators, have become essential for large and smart organizations. The microgrid hardware is crucial in the deployment and development of microgrids worldwide. The components of the hardware are crucial for running operations and initial constructions of microgrids equally. The hardware segment needs and growth are accelerating with the increasing microgrid projects, diminishing energy storage costs, and governments’ interest in focusing on clean energy.
The software segment is expected to grow at a CAGR of 14.20% during the forecast period. The software is crucial for the operation and development of the microgrids. Its renewable energy integration, improved grid stability, and highly efficient energy management have strengthened this segment's position in the global market of microgrids. Microgrid software features several functionalities consisting of an energy management system (EMS), a microgrid control system, SCADA systems, and more. AI and machine learning are yet another boon to the microgrid software, improving future analytics. The software segment is rapidly emerging in the market due to its numerous advantages.
On the basis of connectivity, the grid-connected connectivity segment is expected to have the largest market share in the coming year period. Grid-connected microgrids are made up of several generators, distribution networks, and sophisticated controllers. These technologies offer several benefits, which enhance demand, in addition to increasing grid resiliency, improving power quality, and lowering their environmental effect.
Global utility-based grid network development and the extensive use of renewable energy sources, such as offshore wind, are two major factors influencing the segment's growth.
On the basis of type, the hybrid segment has accounted largest market share in the coming years period. This rise is related to the rising end-user demand for reliable power supply as well as the ongoing rollout of efficient & optimized energy storage technologies. Product penetration will result from a paradigm shift toward the use of low emission and minimal fuel consumption solutions to give better power quality and greater resilience. Additionally, continued technology developments for efficient remote energy management will have a favorable effect on the dynamics of the sector.
The on-grid (grid-connected) segment held the largest share of 54.20% in the 2024 microgrid market. The grid-connected microgrids are a rapidly growing segment in the global microgrid industry. The on-grid provides improved merging of renewable resources, minimal operational cost, and energy reliability while operating in tandem with the primary grid. The development is driven by its easy energy exchange, providing the sale of surplus energy flowing back to the grid and also enhancing grid stability. Its efficient energy systems, mainly as a renewable energy source, make it more approachable for the environmental ecosystem.
The hybrid segment is expected to grow at a CAGR of 13.60% during the forecast period. The hybrid microgrids merging numerous energy sources, such as wind, diesel, and solar, with energy storage, are transformational and developmental. The hybrid promotes sustainability and energy security mainly in remote and developing areas. It also contributes best to a cleaner and greener energy future. The segment is steadily growing and entering sustainable projects, and paving the way to new green energy development.
The solar photovoltaic (PV) segment held the largest share of 36.40% in the 2024 microgrid market. The PV has the potential to expand across various areas with its decentralized energy solution. By covering rural and developing areas with its capable access, the segment has positioned itself with the highest share. The microgrids' independent operations or to be able to connect with the main grid is possible with the solar PV’s potency to enable reliable, clean, and affordable electricity. Solar PV helps a vast population to control their energy resources, making the world a sustainable place to live in. This involves effective participation in energy management.
The hydrogen and fuel cells segments are expected to grow at a CAGR of 15.50% during the forecast period. Specific roles and developments have bolstered the hydrogen and fuel cells, including energy storage, clean energy source, and power quality. The fuel cells have the potential to convert hydrogen into electricity through heat and water. This reduces the environmental impact of microgrids. Hydrogen and fuel cells play a complementary role in the microgrid industry, as hydrogen is producible from surplus renewable energy such as wind and solar. Further, fuel cells convert the stored hydrogen into electricity. The development is driven by EMS, hydrogen production, and integration with hybrid systems. Technological advancement is an additional progress in the microgrid industry globally.
The commercial and industrial (C&I) segment held the largest share of 32.90% in the 2024 microgrid market. The C&I microgrids are important for businesses to manage their energy consumption ratio. The microgrids enable a backup power supply in grid outage cases that promises undisturbed operations for complex facilities such as data centers, manufacturing plants, and hospitals. The businesses get more control over their energy supply, which eliminates or reduces to some extent the dependency on the external energy providers.
The data centers segment is expected to rise at a CAGR of 14.80% during the forecast period. The data centers are increasingly merging with microgrids to lead sustainability, cut costs, and achieve resiliency. Microgrids are localized energy grids which is operational with or without connection. This provides on-site power generation and management. As data centers have become a complex infrastructure and so their demand for power generation has also increased.
The 1 MW- 5 MW segment held the largest share of 28.40% in the 2024 microgrid market. The 1 MW-5 MW power rating is a major segment mainly for commercial and industrial applications, research institutions, remote areas, and hospitals. With the emergency scenarios and heavy operations, this power range is suitable. The microgrids in this range utilize a mix of renewable resources, such as solar, and non-renewable resources such as natural gas. This is the best range of trends in energy storage system integration with the 1 MW-5 MW rate for batteries.
The >5 MW segment is expected to grow at a CAGR of 13.90% during the forecast period. The microgrids crossing over 5 MW are suitable for infrastructure projects, industrial, and commercial. These large microgrids are a combination of non-renewable and renewable energy sources, with a satisfying trend towards merging battery energy storage systems (BESS). With this, the battery market has also encouraged new development into battery-based products. The power rate improves grid resilience and perfectly acts as a resource to the main grid.
The new installations segment peaked with the largest share of 68.50% in the 2024 microgrid market. With the rising demand for microgrids across organizations comes the initial stage of new installations of the microgrid nearby to the organization or area providing energy to the residences and industries. With the smart grid integration using AI and smart metering, the demand has risen exponentially. The microgrids are heading in search of applications in several areas like healthcare, smart campuses, and defense. The new installation will lead to massive expansion in the future with the growth and development of the microgrid industry globally.
The retrofit projects segment is expected to grow at a CAGR of 12.60% during the forecast period. The microgrid retrofit projects have leveraged exemplification in the existing infrastructure area. These relevant projects consist of certain modifications and upgrades in existing power systems to microgrid potential, like connecting to distributed energy resources (DERs) such as battery storage and solar panels.
The AC microgrids segment held the largest share of 57.80% in the 2024 microgrid market. The AC microgrids enable a seamless and familiar solution for integrating distributed energy resources into previous power grids. The AC microgrids accelerate the development of AC power networks and potential electrical devices, easing control and execution. The electrical devices market demands AC microgrids for an effective power source. By sustainably engineering distributed generation such as wind and solar, as well as energy storage, the segment can improve its reliability of power supply grid outages.
The hybrid AC/DC microgrids segment is expected to grow at a CAGR of 14.90% during the forecast period. The hybrid AC/DC microgrids are popular for their flexibility in power systems, mainly in the language of integrating renewable energy sources. These microgrids generate the strength of AC and DC systems, unlocking ways for more smart grids. The flexible approach in linking various energy sources eases integration and improves power quality. It also improves stability by managing power flow between DC and AC sides and contributes to islanded and grid-connected operations.
By Grid Type
By Offering
By Energy Source
By End Use
By Control Type
By Power Rating
By Deployment Mode
By Technology
By Geography
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March 2025
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