The gas turbine services market is estimated to be valued at USD 40.93 Bn in 2024 and is expected to reach USD 73.57 Bn by 2031, growing at a compound annual growth rate (CAGR) of 8.7% from 2024 to 2031. The gas turbine services market is witnessing a shift towards long term service agreements as operators look to ensure availability and performance of aging gas turbine fleets.

Market Driver - Growing Demand for Power Generation Due to Rising Energy Consumption

The ever-increasing demand for electricity across both developed and developing world is well known. Gas in particular is being increasingly relied upon especially in large power plants due to its relatively cleaner burning properties compared to coal or oil.

Established markets in Europe and North America are densifying their grids. Emerging economies in Asia, Africa, and Latin America are on massive infrastructure expansion drives. The switch from coal to gas is also happening gradually yet stubbornly due to environmental regulations against pollution.

Original gas turbine service providers are ramping up production lines to cater to this spike in demand. Third party service providers in the gas turbine services market too have sprouted alongside OEMs to capture a share of the profitable aftermarket services market with specialized offerings. As gas continues to drive the global energy transition for time being supported by policy pushes, gas turbines will remain at the forefront of power sector addition and revamp plans across world regions.

Market Driver - Gas Turbines' High Efficiency and Low Emissions Compared to Other Fossil Fuel-Based Power Plants

Environmental concerns have been at the heart of recent shifts seen in the energy domain worldwide. Furthermore, the high combustion temperatures achieved in gas turbines translate to excellent thermodynamic efficiencies even exceeding 60% for the latest heavy-duty designs.

As a result of the above technical and environmental merits over alternative fossil choices, gas fired power capacity has grown substantially globally at the cost of coal retirements in key regions. Original gas turbine equipment manufacturers have therefore uprated gas turbine models through the years to capture this switch and maximize plant efficiencies further.

In turn, they also benefit from a steadily growing worldwide installed base driving long term services revenue well into the future. With technologies progressing quickly, gas turbines seem set to remain the transition fuel of choice for plurality of power markets in the coming decades augmenting overall prospects in the gas turbine services market.

Market Challenge - Increasing Competition from Renewable Energy Sources, such as Solar and Wind

The gas turbine services market is facing significant competition from rapidly growing renewable energy sources like solar and wind. Solar and wind power prices have declined substantially in the past decade due to technological advances and economies of scale in manufacturing. This has made them increasingly cost competitive with fossil fuel-based power sources.

Many utilities and power producers are now prioritizing additions of renewable capacity to their power generation portfolios to meet decarbonization targets. Gas turbines, being emitters of greenhouse gases, are also facing regulatory and policy pressures in jurisdictions with ambitious climate change commitments. This poses a serious challenge to equipment life management plans and the demand for services in the gas turbine industry.

If the transition to renewables continues at the current pace, it could significantly curtail the gas turbine services market size.

Market Opportunity - Adoption of Digital and Smart Technologies

The adoption of new digital technologies presents promising opportunities for the gas turbine services market. Technologies like predictive maintenance, digital twins, machine learning and advanced data analytics enable remote monitoring of gas turbine operations.

Vibration, temperature and other operational data collected from sensors can be analyzed using these technologies to make highly accurate predictions about future repairs and overhauls required for each turbine component or system. This allows services providers to schedule maintenance in advance to minimize disruptions. It also helps utilities and owners optimize operations and reduces unplanned downtime.

These smart digital solutions can also help in improving fuel efficiency and turbine performance. Their growing use in the gas turbine services market is likely to drive new demand for services centered around implementing, maintaining, and supporting such technologies.

Long-term service agreements (LTSA) - Many gas turbine OEMs such as General Electric and Siemens Energy have adopted the strategy of signing long-term service agreements with end-users. For example, in 2020 GE signed an 8-year LTSA with Al-Jahra Energy Company in Kuwait worth around $200 million for servicing GE gas turbines.

Life-extension programs - Turbine OEMs offer life-extension programs that upgrade and refurbish aging gas turbines to extend their service life by 10-15 years. For instance, in 2018 SIemens Energy completed a turbine life-extension program for SES's Roseton Generating Station in New York, enabling the plant to continue operations through 2050.

Bundled solutions - Turbine OEMs are increasingly bundling digital solution offerings around traditional services. For example, GE offers its Plant Optimization suite which combines monitoring systems, analytics, and asset performance management tools. In 2021, GE secured an 8-year digital solution contract worth over $50 million with EDF Energy in the UK.

Acquisitions - Many players are augmenting their service capabilities through selective acquisitions. For instance, in 2019 Siemens Gas and Power acquired the gas turbine servicing business of Mitsubishi Hitachi Power Systems Americas for $250 million.

Insights, By Turbine Type: Robust Growth in Power and Industrial Sectors

In terms of turbine type, heavy duty turbines account for 40.3% share of the gas turbine services market in 2024. This is due to robust growth in power generation and industrial sectors globally.

Growing electricity demand from population growth and urbanization is driving sizable investments into new coal, natural gas and nuclear power plants across developing nations. Moreover, strict emissions norms are prompting replacement of aging fleet of utility boilers with more efficient combined cycle gas turbines.

On the industrial front, energy intensive sectors such as aluminum, petrochemicals and fertilizers rely heavily on captive cogeneration facilities using heavy duty gas turbines for secure power and steam supplies. Tightening environmental regulations regarding emissions are also catalyzing replacements of old inefficient captive power units.

Overall expansion of the global electricity grid and industries is creating steady demand for maintenance services of existing heavy-duty turbines as well as installation of new units, thereby accelerating the heavy-duty turbine services segment.

Insights, By Service Type: Aftermarket Services Dominate Amid Increasing Fleet Utilization

In terms of service type, maintenance & repair services are projected to hold 46.2% share of the gas turbine services market in 2024. It is driven by the increasing demand for aftermarket services. Gas turbine operators are relying more on life extension services to squeeze additional runtime from existing turbine assets amid restricted capital budgets for new installations.

Furthermore, competitive contracts for long-term service agreements with gas plant operators offer lucrative recurring revenues for M&R service providers, enabling greater budgetary control. Evolving standards such as Condition Based Maintenance (CBM) and Reliability Centered Maintenance (RCM) also optimize maintenance intervals based on actual equipment condition rather than fixed schedules.

These factors are driving strong demand growth for maintenance & repair services over other lifecycle services. This in turn, will contribute to growth of the gas turbine services market.

Insights, By End User: Power Generation Sector Tightens Service Networks

In terms of end user, power generation contributes the highest share of the gas turbine services market driven by capacity additions in emerging economies. Power producers increasingly outsource turbine services to specialized OEMs and independent service providers for reducing operational downtime and minimizing life-cycle costs. While operations and maintenance functions may remain in-house, utilities are open to performance-based long term service agreements aligning service provider incentives with plant reliability targets.

Centralized maintenance pools with mobile field service teams also help attain consistent service standards across geographically dispersed gas turbine fleet. Central & South American nations in particular are witnessing massive investments to expand electricity access rates through combined cycle gas plants.

Collaborations such as integrated asset management programs integrating OEM expertise further optimize the overall turbine lifecycle for power generators. Such factors continue spurring demand from the power generation end-user segment.

• The adoption of remote monitoring systems has become prevalent, allowing service providers to offer real-time diagnostics and predictive maintenance, significantly reducing operational costs for end-users.
• Collaborations between OEMs and independent service providers have increased, aiming to expand service offerings and reach a broader customer base.
• Asia-Pacific Region Dominance: The Asia-Pacific region holds the largest share in the gas turbine services market due to rapid industrialization and increasing energy demand in countries like China and India.
• Europe is expected to be the fastest-growing region in the gas turbine services market due to the transition from coal to gas for power generation, and advancements in gas turbine technology.
• Environmental Regulations Impact: Stricter emission standards globally are propelling the upgrade and maintenance of existing gas turbines to comply with new regulations.

The major players operating in the gas turbine services market include General Electric, Siemens AG, Mitsubishi Power, Rolls-Royce, Ansaldo Energia, MTU Aero Engines, Solar Turbines, Sulzer AG, MJB International, Kawasaki Heavy Industries, MAN Energy Solutions, EthosEnergy, and MTU Aero Engines AG.

• In September 2023, Mitsubishi Heavy Industries (MHI) made significant advancements in gas turbine service technology. They developed a highly efficient gas turbine, the M701JAC, which has set new industry standards for efficiency and emissions reduction. This turbine operates at an inlet temperature of 1,650°C, resulting in a combined cycle thermal efficiency of over 63%.
• In June 2023, Siemens AG announced a partnership with a Middle Eastern energy company to provide long-term maintenance services for their gas turbine fleet, aiming to improve efficiency and reliability. This can help the company gain a competitive advantage in the gas turbine services market.
• In March 2023, General Electric launched a new digital monitoring for gas turbine services, enhancing predictive maintenance capabilities and reducing downtime for clients.

• By Turbine Type
  • Heavy Duty
  • Industrial
  • Aeroderivatives
• By Service Type
  • Maintenance & Repair
  • Overhaul
  • Spare Parts Supply
• By End User
  • Power Generation
  • Oil & Gas
  • Industrial
  • Aviation