The district cooling market is expected to increase from US$ 29.2 billion in 2023 to US$ 63.2 billion by 2033, at an 8.0% CAGR from 2023 to 2033.
| Report Attribute | Details |
|---|---|
| Market Value (2023) | US$ 29.2 billion |
| Market Anticipated Value (2033) | US$ 63.2 billion |
| Market Growth Rate (2023 to 2033) | 8.0% CAGR |
The Rising Environmental Impact of Global Warming May Drive The Market
Global warming has a harmful influence on the environment. For example, trees are blooming earlier, ice on rivers and lakes is breaking earlier, and glaciers are receding. Carbon dioxide (CO2) concentrations in the atmosphere have risen over the last century as a result of the use of fossil fuels such as coal and oil.
Furthermore, land clearing for industrial and agricultural uses, as well as other human activities, has increased the concentration of hazardous greenhouse gases. As a result, temperatures have risen, contributing to the effects of global warming. As a result, as global warming continues, there might be a growing demand for cooling.
Temperatures are scorching, and people are seeing a rise in the intensity and frequency of heat waves each year as global warming fears mount. Extreme heat events are killing more people around the world. As the temperature rises to critical levels, the environmental consequences escalate, posing serious threats to living creatures.
Temperature rises can also harm data centers, perishable foods and related agriculture services, and the supply of health services such as vaccines and medicines. Given these conditions, access to environmentally friendly, long-lasting cooling solutions is critical. Governments also stress the use of reclaimed water in district cooling operations, as well as the reduction of electricity use.
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The district cooling market is expected to be worth US$ 27.1 billion by 2022, growing at a 7.6% CAGR. Absolute dollar growth in the global market is US$ 34.0 billion.
District cooling systems distribute chilled water produced in a central plant to buildings via an insulated pipe network, enabling free cooling and significantly lowering power use. These systems can also exchange heat with natural water sources such as rivers, lakes, and seas. These systems make better use of building structures and enable peak shaving via thermal energy storage.
District cooling systems take use of economies of scale by removing the need for individual air conditioning units in buildings. Furthermore, DC systems use less energy than AC systems and have little to no refrigerant leakage. While DC systems have acquired substantial importance in leading countries throughout the world, they have yet to be recognized as a cross-cutting technology that must be complemented by suitable interventions at the state and central levels. Governments are launching initiatives and instituting regulatory obligations in local ordinances as well as fiscal incentives to achieve significant energy savings and expand access to cost-effective cooling systems.
| Historical CAGR (2017 to 2022) | 7.6% |
|---|---|
| Forecast CAGR (2023 to 2033) | 8.0% |
As per the FMI analysts, a valuation of US$ 63.2 billion by 2033 end is estimated for the market.
| Year | Market Value |
|---|---|
| 2016 | US$ 21.82 million |
| 2021 | US$ 931 billion |
| 2022 | US$ 27.1 billion |
| 2023 | US$ 29.2 billion |
| 2033 | US$ 63.2 billion |
The population living in tropical and hot temperature regions requires cooling to be more comfortable, particularly during the summer. The International Energy Agency (IEA) reports that air conditioner ownership is increasing in certain areas. The Middle East is one of the most advanced markets for district cooling.
Summertime temperatures in the Middle East have surpassed 50 degrees Celsius. One of the most important issues confronting the countries in this region is cooling. According to the Dubai Electricity and Water Authority, between midday in the summer, there is a 40% increase in demand for electricity, primarily for cooling. During the summer, cooling accounts for 70% of the region's energy requirement.
District cooling is a good solution for energy-intensive traditional cooling systems since it allows for efficient cooling. According to the IEA, global energy demand for space cooling increased by 60% between 2000 and 2010. When compared to conventional air conditioning, district cooling helps reduce the use of environmentally harmful refrigerants such as hydrochlorofluorocarbons (HCFCs) and hydrofluorocarbons (HFCs).
The primary district cooling markets in the Middle East are Saudi Arabia, the UAE, Qatar, Bahrain, Oman, and Kuwait. The need to save energy and the region's exceptionally high temperatures are two important factors that are projected to enhance demand for energy-efficient cooling.
Principal Consultant
District cooling plants are time-consuming and capital-intensive, demanding substantial planning. The installation of the distribution network is equally costly. District cooling necessitates a large-scale centralized cooling generation and distribution grid. As a result, it has substantial capital expenditures (CAPEX) for production and delivery. This significant capital outlay must be offset by decreased operating expenses.
Different manufacturing technologies can be employed to optimize operating expenses (OPEX) through a centralized facility. The development of the distribution system accounts for approximately 50% of overall investments. As a result, district cooling is economically viable in locations with high cooling demand density but expensive in low-density ones. The rate of return on investment for district cooling is higher and therefore only suited for the long term.
Energy use is accounted for by buildings. As a result, energy-efficient structures are required. Buildings must lower their energy use under the new building codes. In Europe, for example, Eurocodes ensure that buildings are both sustainable and under the applicable codes. The International Code Council's International Energy Conservation Code also requires energy-efficient structures.
With rising income and urbanization, the need for cooling is increasing. Rising energy prices, growing environmental concerns, and an increased need for low-cost, high-efficiency cooling systems are likely to drive district cooling demand. District cooling plants utilize less water and energy, which results in greater environmental benefits. Cooling is generated in a centralized facility, which is more efficient than individual air conditioners.
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Heat fluctuates from 35 to 55 Celsius in the Middle East, resulting in DC systems commonly employed to meet rising cooling needs. As a result, the worldwide district cooling industry may soon be driven by expanding Middle Eastern demand.
Tropical and hot climate populations require cooling, especially during the summer, according to the IEA, air conditioner ownership is rising in these areas, and the Middle East is the second-leading market for district cooling systems. Summer temperatures in the Middle East have risen beyond 50°C. Cooling is a significant concern in this location.
Dubai Power and Water Authority see a 40% rise in electricity use in the summer. Cooling accounts for 70% of the energy used by the region in the summer. Therefore, district heating and cooling is a better way to cool and heat than traditional methods that use a lot of energy.
There are a lot of districts in the Middle East that use district cooling technology. These are Saudi Arabia, UAE, Qatar, Bahrain, Oman, Kuwait, and more. Demand for district energy plant conditioning is expected to rise because of the need to save energy and the extreme heat in the area.
District cooling systems are capital and time expensive, requiring extensive planning, and the distribution network is highly costly to install. District heating and cooling require massive centralized production and distribution systems. As a result, manufacturing and delivery costs are considerable.
Reduced operational expenses must offset large capital expenditures. Various manufacturing for district cooling technology can be employed to reduce OPEX in a centralized facility. The distribution grid accounts for around half of the overall investments. District cooling technology is cost-effective in high-density regions but inefficient in low-density ones. District cooling technology has a slower return on investment and is only appropriate for long-term use, which is causing hesitance among market players.
Rising affluence and urbanization are boosting the district cooling market's demand. The desire for district cooling technology is predicted to increase because of rising energy costs, environmental concerns, and demand for low-cost, high-efficiency systems.
District energy plants utilize less water and energy, benefiting the environment. In addition, centralized cooling is more efficient than individual air conditioners.
The space needed for district cooling plants and pipes is enormous, and the building takes to proceed in phases over time. In addition, there are interactions with other infrastructure in the chilled water and condensing water piping systems.
Interfacing issues are typical in such instances, especially in Greenfield sites. To tackle these interface challenges, an integrated planning strategy is necessary. The main construction issue with a district cooling system is the lack of space for building equipment.
Other construction obstacles include relocating equipment and coordinating builders. One of the most significant difficulties is ensuring chiller plants and distribution pipes. Operating a district cooling plant year-round is difficult.
| Country | United States |
|---|---|
| CAGR (2017 to 2022) | 6.4% |
| Valuation (2023 to 2033) | US$ 17.4 billion |
| Country | France |
|---|---|
| CAGR (2017 to 2022) | 7.2% |
| Valuation (2023 to 2033) | US$ 893.9 billion |
| Country | China |
|---|---|
| CAGR (2017 to 2022) | 8.4% |
| Valuation (2023 to 2033) | US$ 4.1 billion |
| Country | Japan |
|---|---|
| CAGR (2017 to 2022) | 8.4% |
| Valuation (2023 to 2033) | US$ 5.5 billion |
| Country | South Korea |
|---|---|
| CAGR (2017 to 2022) | 8.1% |
| Valuation (2023 to 2033) | US$ 4.8 million |
Due to its harsh weather conditions, which necessitate year-round cooling, the region exhibits significant potential for the utilization of district cooling systems. Furthermore, the installation of costly glass exteriors for hotels, airports, and workplaces, among others, bolsters market demand, resulting in exceptionally high temperatures inside.
The Middle Eastern government has recognized that district cooling systems may meet the region's refrigeration and cooling needs. Furthermore, the combination of distributed generation of energy and waste heat usage can provide a long-term solution to an expanding number of hotels, residential complexes, commercial buildings retails and malls, and other structures.
Another lucrative market for district cooling systems in the Asia Pacific. Rising district cooling system deployments in a variety of offices and commercial locations boost market income. Furthermore, the region's district cooling market size is supported by increased urbanization and government initiatives to ensure the use of energy-efficient district cooling systems in newly constructed office buildings.
With increased industrialization and rising spending on energy-efficient cooling systems in commercial projects, India, Australia, and Indonesia are the main markets for district cooling solutions. With its substantial commercial construction expansion, India is a promising market for district cooling products. International firms are increasingly establishing exclusive reseller partnerships with local players to grow their footprints in the Indian market.
| Attribute | Details |
|---|---|
| Market Size Value in 2023 | US$ 29.2 billion |
| Market Size Value in 2033 | US$ 63.2 billion |
| Market Analysis | US$ billion for Value |
| Key Region Covered | North America; Latin America; Europe; Asia Pacific; The Middle East & Africa |
| Key Segments | By Production Technique, By Application, By Region |
| Key Companies Profiled | National Central Cooling Company PJSC; Emirates District Cooling; LLC (EMICOOL); Shinryo Corporation; ADC Energy Systems LLC; Keppel DCHS PTE LTD; LOGSTOTR A/S; Ramboll Group A/S; SIEMENS AG; Stellar Energy |
| Report Coverage | Market Forecast, Company Share Analysis, Competition Intelligence, DROT Analysis, Market Dynamics and Challenges, and Strategic Growth Initiatives |
| Customization & Pricing | Available upon Request |
Many commercial buildings such as hospitals, educational institutions, retail malls, market complexes, government, and corporate offices, and public transport buildings together account for the leading share of the district cooling market.
Industrial establishments have traditionally been the significant utilizers of district cooling systems. However, because of the high installation cost of the large-scale district cooling system, its adoption in residential buildings has remained limited to large apartments.
As the overall temperature regulation cost for big commercial spaces can be reduced significantly by using district cooling systems, it has emerged as the most preferred solution for this segment. Commercial buildings have overtaken industrial buildings in using district cooling facilities as it offers maximum energy utilization compared to individual room cooling solutions.
Due to the continuous requirement for cooling spaces in certain sections of the industrial set-up, the district cooling market is expected to experience a favorable growth potential with the rise of industries in emerging economies: In addition, the recent development of district cooling technology systems with connection and disconnection facilities is expected to gain popularity even in small settlements with separate buildings.
Electric chillers are the most suitable method among the various production techniques used in the district cooling market, electric chillers guarantee an uninterrupted supply of cooling services that makes them the most preferred solutions for buildings requiring temperature regulation all day long.
Combined with some provisions for utilizing electricity generated from renewable sources, this segment may become the significant district cooling advantage to acquire the dominant position.
The absorption cooling technique is also preferred equally for setting up district cooling systems in various regions. This segment also possesses equal opportunities for growth during the forecast period by utilizing a more sustainable energy source. However, the growth of the free cooling market has stagnated in recent years with other techniques because of its low capacity in terms of volume it can cool, which is the central district cooling disadvantage of this technique type.
In 2023, the market is expected to be worth US$ 29.2 billion.
The market is expected to be around US$ 63.2 billion by 2033.
The market is expected to boost at an 8% CAGR until 2033.
The United States market to attain a valuation of US$ 17.4 billion from 2023 to 2033.
China's market to attain a valuation of US$ 4.1 billion from 2023 to 2033.
District cooling demand is increasing as urbanization and rising wealth do.
1. Executive Summary
1.1. Global Market Outlook
1.2. Demand-side Trends
1.3. Supply-side Trends
1.4. Technology Roadmap Analysis
1.5. Analysis and Recommendations
2. Market Overview
2.1. Market Coverage / Taxonomy
2.2. Market Definition / Scope / Limitations
3. Market Background
3.1. Market Dynamics
3.1.1. Drivers
3.1.2. Restraints
3.1.3. Opportunity
3.1.4. Trends
3.2. Scenario Forecast
3.2.1. Demand in Optimistic Scenario
3.2.2. Demand in Likely Scenario
3.2.3. Demand in Conservative Scenario
3.3. Opportunity Map Analysis
3.4. Product Life Cycle Analysis
3.5. Investment Feasibility Matrix
3.6. PESTLE and Porter’s Analysis
3.7. Regulatory Landscape
3.7.1. By Key Regions
3.7.2. By Key Countries
3.8. Regional Parent Market Outlook
4. Global Market Analysis 2017 to 2022 and Forecast, 2023 to 2033
4.1. Historical Market Size Value (US$ Million) Analysis, 2017 to 2022
4.2. Current and Future Market Size Value (US$ Million) Projections, 2023 to 2033
4.2.1. Y-o-Y Growth Trend Analysis
4.2.2. Absolute $ Opportunity Analysis
5. Global Market Analysis 2017 to 2022 and Forecast 2023 to 2033, By End-user
5.1. Introduction / Key Findings
5.2. Historical Market Size Value (US$ Million) Analysis By End-user, 2017 to 2022
5.3. Current and Future Market Size Value (US$ Million) Analysis and Forecast By End-user, 2023 to 2033
5.3.1. Blood Transfusion
5.3.2. Oxygen Therapy
5.3.3. Antibiotics
5.3.4. Opioids
5.3.5. Amphetamine & Methamphetamine
5.3.6. LSD
5.3.7. Other End-users
5.4. Y-o-Y Growth Trend Analysis By End-user, 2017 to 2022
5.5. Absolute $ Opportunity Analysis By End-user, 2023 to 2033
6. Global Market Analysis 2017 to 2022 and Forecast 2023 to 2033, By Region
6.1. Introduction
6.2. Historical Market Size Value (US$ Million) Analysis By Region, 2017 to 2022
6.3. Current Market Size Value (US$ Million) Analysis and Forecast By Region, 2023 to 2033
6.3.1. North America
6.3.2. Latin America
6.3.3. Europe
6.3.4. Asia Pacific
6.3.5. Middle East and Africa
6.4. Market Attractiveness Analysis By Region
7. North America Market Analysis 2017 to 2022 and Forecast 2023 to 2033, By Country
7.1. Historical Market Size Value (US$ Million) Trend Analysis By Market Taxonomy, 2017 to 2022
7.2. Market Size Value (US$ Million) Forecast By Market Taxonomy, 2023 to 2033
7.2.1. By Country
7.2.1.1. USA
7.2.1.2. Canada
7.2.2. By End-user
7.3. Market Attractiveness Analysis
7.3.1. By Country
7.3.2. By End-user
7.4. Key Takeaways
8. Latin America Market Analysis 2017 to 2022 and Forecast 2023 to 2033, By Country
8.1. Historical Market Size Value (US$ Million) Trend Analysis By Market Taxonomy, 2017 to 2022
8.2. Market Size Value (US$ Million) Forecast By Market Taxonomy, 2023 to 2033
8.2.1. By Country
8.2.1.1. Brazil
8.2.1.2. Mexico
8.2.1.3. Rest of Latin America
8.2.2. By End-user
8.3. Market Attractiveness Analysis
8.3.1. By Country
8.3.2. By End-user
8.4. Key Takeaways
9. Europe Market Analysis 2017 to 2022 and Forecast 2023 to 2033, By Country
9.1. Historical Market Size Value (US$ Million) Trend Analysis By Market Taxonomy, 2017 to 2022
9.2. Market Size Value (US$ Million) Forecast By Market Taxonomy, 2023 to 2033
9.2.1. By Country
9.2.1.1. Germany
9.2.1.2. United Kingdom
9.2.1.3. France
9.2.1.4. Spain
9.2.1.5. Italy
9.2.1.6. Russia
9.2.1.7. Rest of Europe
9.2.2. By End-user
9.3. Market Attractiveness Analysis
9.3.1. By Country
9.3.2. By End-user
9.4. Key Takeaways
10. Asia Pacific Market Analysis 2017 to 2022 and Forecast 2023 to 2033, By Country
10.1. Historical Market Size Value (US$ Million) Trend Analysis By Market Taxonomy, 2017 to 2022
10.2. Market Size Value (US$ Million) Forecast By Market Taxonomy, 2023 to 2033
10.2.1. By Country
10.2.1.1. China
10.2.1.2. Japan
10.2.1.3. India
10.2.1.4. South Korea
10.2.1.5. Australia
10.2.1.6. Rest of APAC
10.2.2. By End-user
10.3. Market Attractiveness Analysis
10.3.1. By Country
10.3.2. By End-user
10.4. Key Takeaways
11. Middle East and Africa Market Analysis 2017 to 2022 and Forecast 2023 to 2033, By Country
11.1. Historical Market Size Value (US$ Million) Trend Analysis By Market Taxonomy, 2017 to 2022
11.2. Market Size Value (US$ Million) Forecast By Market Taxonomy, 2023 to 2033
11.2.1. By Country
11.2.1.1. South Africa
11.2.1.2. Saudi Arabia
11.2.1.3. UAE
11.2.1.4. Israel
11.2.1.5. Rest of MEA
11.2.2. By End-user
11.3. Market Attractiveness Analysis
11.3.1. By Country
11.3.2. By End-user
11.4. Key Takeaways
12. Key Countries Market Analysis
12.1. USA
12.1.1. Pricing Analysis
12.1.2. Market Share Analysis, 2022
12.1.2.1. By End-user
12.2. Canada
12.2.1. Pricing Analysis
12.2.2. Market Share Analysis, 2022
12.2.2.1. By End-user
12.3. Brazil
12.3.1. Pricing Analysis
12.3.2. Market Share Analysis, 2022
12.3.2.1. By End-user
12.4. Mexico
12.4.1. Pricing Analysis
12.4.2. Market Share Analysis, 2022
12.4.2.1. By End-user
12.5. Germany
12.5.1. Pricing Analysis
12.5.2. Market Share Analysis, 2022
12.5.2.1. By End-user
12.6. United Kingdom
12.6.1. Pricing Analysis
12.6.2. Market Share Analysis, 2022
12.6.2.1. By End-user
12.7. France
12.7.1. Pricing Analysis
12.7.2. Market Share Analysis, 2022
12.7.2.1. By End-user
12.8. Spain
12.8.1. Pricing Analysis
12.8.2. Market Share Analysis, 2022
12.8.2.1. By End-user
12.9. Italy
12.9.1. Pricing Analysis
12.9.2. Market Share Analysis, 2022
12.9.2.1. By End-user
12.10. Russia
12.10.1. Pricing Analysis
12.10.2. Market Share Analysis, 2022
12.10.2.1. By End-user
12.11. China
12.11.1. Pricing Analysis
12.11.2. Market Share Analysis, 2022
12.11.2.1. By End-user
12.12. Japan
12.12.1. Pricing Analysis
12.12.2. Market Share Analysis, 2022
12.12.2.1. By End-user
12.13. India
12.13.1. Pricing Analysis
12.13.2. Market Share Analysis, 2022
12.13.2.1. By End-user
12.14. South Korea
12.14.1. Pricing Analysis
12.14.2. Market Share Analysis, 2022
12.14.2.1. By End-user
12.15. Australia
12.15.1. Pricing Analysis
12.15.2. Market Share Analysis, 2022
12.15.2.1. By End-user
12.16. South Africa
12.16.1. Pricing Analysis
12.16.2. Market Share Analysis, 2022
12.16.2.1. By End-user
12.17. Saudi Arabia
12.17.1. Pricing Analysis
12.17.2. Market Share Analysis, 2022
12.17.2.1. By End-user
12.18. UAE
12.18.1. Pricing Analysis
12.18.2. Market Share Analysis, 2022
12.18.2.1. By End-user
12.19. Israel
12.19.1. Pricing Analysis
12.19.2. Market Share Analysis, 2022
12.19.2.1. By End-user
13. Market Structure Analysis
13.1. Competition Dashboard
13.2. Competition Benchmarking
13.3. Market Share Analysis of Top Players
13.3.1. By Regional
13.3.2. By End-user
14. Competition Analysis
14.1. Competition Deep Dive
14.1.1. EMIRATES CENTRAL COOLING SYSTEM CORPORATION
14.1.1.1. Overview
14.1.1.2. Product Portfolio
14.1.1.3. Profitability by Market Segments
14.1.1.4. Sales Footprint
14.1.1.5. Strategy Overview
14.1.1.5.1. Marketing Strategy
14.1.2. NATIONAL CENTRAL COOLING COMPANY PJSC
14.1.2.1. Overview
14.1.2.2. Product Portfolio
14.1.2.3. Profitability by Market Segments
14.1.2.4. Sales Footprint
14.1.2.5. Strategy Overview
14.1.2.5.1. Marketing Strategy
14.1.3. EMIRATES (EMICOOL), LLC
14.1.3.1. Overview
14.1.3.2. Product Portfolio
14.1.3.3. Profitability by Market Segments
14.1.3.4. Sales Footprint
14.1.3.5. Strategy Overview
14.1.3.5.1. Marketing Strategy
14.1.4. SHINRYO CORPORATION
14.1.4.1. Overview
14.1.4.2. Product Portfolio
14.1.4.3. Profitability by Market Segments
14.1.4.4. Sales Footprint
14.1.4.5. Strategy Overview
14.1.4.5.1. Marketing Strategy
14.1.5. ADC ENERGY SYSTEMS LLC
14.1.5.1. Overview
14.1.5.2. Product Portfolio
14.1.5.3. Profitability by Market Segments
14.1.5.4. Sales Footprint
14.1.5.5. Strategy Overview
14.1.5.5.1. Marketing Strategy
14.1.6. KEPPEL DHCS PTE LTD
14.1.6.1. Overview
14.1.6.2. Product Portfolio
14.1.6.3. Profitability by Market Segments
14.1.6.4. Sales Footprint
14.1.6.5. Strategy Overview
14.1.6.5.1. Marketing Strategy
14.1.7. LOGSTOR A/S
14.1.7.1. Overview
14.1.7.2. Product Portfolio
14.1.7.3. Profitability by Market Segments
14.1.7.4. Sales Footprint
14.1.7.5. Strategy Overview
14.1.7.5.1. Marketing Strategy
14.1.8. RAMBOLL GROUP A/S
14.1.8.1. Overview
14.1.8.2. Product Portfolio
14.1.8.3. Profitability by Market Segments
14.1.8.4. Sales Footprint
14.1.8.5. Strategy Overview
14.1.8.5.1. Marketing Strategy
14.1.9. SIEMENS AG
14.1.9.1. Overview
14.1.9.2. Product Portfolio
14.1.9.3. Profitability by Market Segments
14.1.9.4. Sales Footprint
14.1.9.5. Strategy Overview
14.1.9.5.1. Marketing Strategy
14.1.10. STELLAR ENERGY
14.1.10.1. Overview
14.1.10.2. Product Portfolio
14.1.10.3. Profitability by Market Segments
14.1.10.4. Sales Footprint
14.1.10.5. Strategy Overview
14.1.10.5.1. Marketing Strategy
15. Assumptions & Acronyms Used
16. Research Methodology
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District Cooling Market
