The global diesel generator market attained a value of USD 24.20 Billion in 2025 and is projected to expand at a CAGR of 8.10% through 2035. The market is further expected to achieve USD 52.73 Billion by 2035. High-efficiency generator demand is getting progressively pulled up by rugged telecom towers deployments, remote industrial sites, and construction projects in regions with unstable grids. These diesel generators are also known for their round-the clock, unmanned, and rugged operations.
One of the recent and impactful changes, which has been a major driving factor for market expansion, is Cummins’s launch of its next-generation fuel-agnostic engine platform in March 2023. This generator was designed to run traditional diesel while permitting a subsequent shift to low-carbon fuels. It is also compatible with the company's overall decarbonization roadmap and effectively meets the rising demand for reliable backup power in data centers.
According to recent data center capacity additions across North America and Asia, operators are expanding footprint at a pace that outstrips grid readiness. In turn, this diesel generator market trend reinforces procurement of high-density gensets that can adapt to evolving emissions norms without sacrificing uptime reliability.
The market is responding to several demand changes caused by factors like the expansion of infrastructure, unstable grid conditions in emerging economies, and the continuation of energy security measures. Vendors are equipping the mechanical systems with real-time monitoring capabilities, increased load acceptance, and smart paralleling technology to guarantee uninterrupted operation even during severe grid disturbances. For example, Jakson Group introduced the next-generation CPCB IV+ compliant gensets, powered by Cummins, in Dehradun, Uttarakhand in October 2024, creating new diesel generator market opportunities. Purchasing patterns are also changing. Commercial buyers of today favor modular solutions that simplify deployment, especially in telecom, healthcare, mining, and remote industrial applications.
Base Year
Historical Period
Forecast Period
Compound Annual Growth Rate
8.1%
Value in USD Billion
2026-2035
*this image is indicative*
The widening gap between grid capacity and load growth is one major driving engine for the diesel generator market growth. This is especially the case in regions undergoing rapid electrification and urban migrations. Governments are repeatedly issuing advisories and regulatory updates to strengthen backup preparedness. For example, the United States Department of Energy’s Grid Resilience and Innovation Partnerships (GRIP) program has allocated billions toward strengthening the national grid, indirectly pushing hospitals, data centers, and industrial plants to maintain diesel gensets as part of their resilience stack. In January 2025, GM announced the new commercial applications of its HYDROTEC fuel cell technology, as the company’s initiative towards electrification.
Hyperscale data centers remain one of the fastest-growing demand pools. Operators increasingly depend on multi-MW diesel generators for redundancy because battery-only backup still struggles with long-duration resilience. New campuses by Amazon Web Services, Google, and Microsoft across Virginia, Singapore, and Mumbai include next-gen diesel gensets with improved NOx control and advanced load-acceptance tuning, influencing diesel generator market trends and dynamics. In August 2025, Rolls-Royce began its local production of its mtu Series 2000 G06 engine, targeting data center and power generation applications in China.
Massive infrastructure upgrades are driving sustained uptake of portable and stationary diesel generators for on-site power. Programs like the United States Infrastructure Investment and Jobs Act (IIJA), India’s PM Gati Shakti program, and Saudi Arabia’s giga-projects (NEOM, Red Sea, Qiddiya) all require dependable temporary power solutions for tunneling, lifting, welding, and remote-site fabrication work. Hitachi Energy announced plans to launch a movable variant of an eco-friendly generator for temporary deployment in November 2023. Construction contractors prefer diesel systems due to their ruggedness, fuel availability, and predictable performance in dusty or uneven terrains, impacting the overall diesel generator market opportunities.
Telecom operators are persistently installing thousands of new towers in the rural and semi-urban areas where grid connectivity is either weak or not available. The government-led digital inclusion programs in Africa, India, and Indonesia have been the main contributors to the speedy rollout of towers, with each site calling for reliable off-grid or hybrid diesel power. For example, the BharatNet Phase-II extension in India is introducing broadband to the remote villages, making it necessary for the tower companies to deploy gensets that come with remote monitoring and extended service intervals, thus facilitating the diesel generator market value growth. In October 2024, HIMOINSA released the HGY Series, a novel power solution that is ready to be the main power source for mission-critical projects. The series combines the power generation expertise of HIMOINSA with the advanced engine technology of YPT.
Processing units, factories, and logistics hubs are strengthening their backup systems to stay away from losses due to production downtime. Countries like Mexico, Vietnam, and the UAE have been experiencing an unprecedented level of industrial investment. Consequently, this diesel generator market trend was instrumental in prompting OEMs to produce higher-capacity gensets that can facilitate continuous, multi-shift production. In November 2024, Hyliion Holdings Corp. shared the news of the successful demonstration of the KARNO generator that comes with revolutionary fuel-agnostic capabilities, confirming a seamless switch between different fuel types even during their live operation.
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The EMR’s report titled “Global Diesel Generator Market Report and Forecast 2026-2035” offers a detailed analysis of the market based on the following segments:
Market Breakup by Power Rating
Key Insight: As per market data, small-scale generators are still a fundamental need for households, small clinics, retail outlets, and mobile site operations. This demand is mainly driven by the affordability and simplicity of their implementation. Medium-power generators are on the front line to serve mid-size factories, commercial complexes, and regional logistics hubs by providing a fair combination of cost-efficiency and durability, boosting the diesel generator market revenue. High-power generators retain their core position in mission-critical environments such as data centers, heavy industries, airports, and refineries, and it is growing its market shares at a quick pace due to increased load densities and higher reliability requirements.
Market Breakup by Mobility
Key Insight: Stationary generators remain foundational for industries, hospitals, and commercial facilities where prolonged outages can halt production or compromise safety, and where permanent installations ensure compliance and seamless integration. Portable generators dominate dynamic and temporary environments such as construction sites, outdoor events, remote maintenance teams, and emergency response operations where mobility and rapid setup are essential, creating new diesel generator market opportunities for growth.
Market Breakup by Cooling System
Key Insight: Liquid-cooled generators drive major demand in the diesel generator market across large-scale industrial, healthcare, and data center environments that depend on continuous uptime and rugged thermal management. Their ability to withstand long-duration loads and extreme climates makes them essential for mission-critical power frameworks. Air-cooled units, in contrast, serve lighter, flexible, and budget-driven applications where mobility, simplicity, and rapid deployment matter. They are favored across small commercial setups, remote operations, residential societies, and construction crews.
Market Breakup by Application
Key Insight: On one hand, standby backup generators remain essential for critical facilities and businesses needing uninterrupted power during outages. On the other hand, peak shaving serves energy-intensive sectors looking to reduce operational costs by offsetting grid dependency during high-tariff windows, broadening the diesel generator market scope. Both applications reflect evolving energy-management priorities. Standby focuses on reliability, while peak shaving targets cost efficiency.
Market Breakup by End Use
Key Insight: Trends across the end use segmentation are variable. Industrial operations require high-capacity, reliable gensets to maintain productivity and process stability, making them the largest end-use contributor. Commercial establishments demand digitally monitored systems to protect customer services, data integrity, and environmental comfort, driving rapid growth in this category. Residential users continue adopting smaller gensets to mitigate routine grid fluctuations and ensure appliance continuity.
Market Breakup by Region
Key Insight: Asia Pacific occupies the leading position in the diesel generator market. This is due to strong manufacturing expansion, infrastructure development, and persistent grid inconsistencies. North America and Europe maintain steady adoption driven by data centers, healthcare facilities, food logistics, and industrial automation requirements. Latin America relies on diesel gensets for both urban resilience and remote-resource operations, while the Middle East & Africa experiences rapid uptake due to megaproject execution and unreliable grids.
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By power rating, low power generator leads the market owing to residential and small-business reliability needs
Low-power diesel generators maintain the largest share of the market. This is because they serve residential, small commercial, retail, and light industrial environments. The category benefits from higher purchase frequency, ease of service, and lower acquisition costs, ensuring steady volume movement across distributors. In December 2023, Cummins Inc. announced the newly released C1760D5, C1875D5 and C2000D5B generator models that result in even more power for a wider range of applications. Light construction contractors, rural clinics, telecom repeaters, and small warehouses continue to rely on this rating because it offers immediate deployment without complex installation requirements.
High-power diesel generators are posting the fastest growth in the diesel generator market as hyperscale data centers, large manufacturing plants, petrochemical facilities, and logistics hubs expand globally. These assets need multi-megawatt backup infrastructure with tight synchronization and rapid load acceptance, making large-rated gensets the default redundancy source. Industries undergoing automation upgrades are demanding higher electrical stability, further driving adoption.
By mobility, stationary generators account for the dominant share of the market due to industrial and commercial baseline loads
Stationary diesel generators hold the dominant market share as industrial plants, commercial buildings, healthcare facilities, and data centers depend on permanently installed systems to protect critical operations. These setups are designed for long-duration backup with facility switchgear, which makes them indispensable for regulated sectors. For example, HIMOINSIA offers a 'HS Stationary Range' that has been designed to meet the needs of stationary applications. Users value the robustness of stationary gensets, which offer longer service intervals, safer fuel storage, and easier compliance with emissions and noise standards.
As per the diesel generator market report, portable diesel generators are witnessing the fastest growth because construction contractors, event managers, field-service teams, rural telecom operations, and emergency-response units need flexible and immediate power sources. These units allow rapid deployment across shifting job sites and outdoor environments. Therefore, these are ideal for short-term or mobile operations. Manufacturers are upgrading portability with lighter frames, towable chassis, optimized fuel efficiency, and digital control panels that support quick startup even under rugged conditions.
Liquid cooling systems occupy a significant portion of the market due to heavy-duty industrial load requirements
Liquid-cooled diesel generators, engineered for high-load applications lead the market. These systems deliver superior thermal stability, making them suitable for continuous or prime-power setups where overheating risks must be minimized. Their enclosed radiators, high-capacity coolant systems, and improved acoustic insulation appeal to end users who prioritize reliability, noise reduction, and operational longevity, broadening the diesel generator market scope.
Air-cooled diesel generators are expanding their shares in the market and are contributing greatly to the market revenue. Small enterprises, construction contractors, residential communities, and field teams seek low-maintenance, compact, and cost-friendly power systems. These units eliminate the need for coolant systems, reducing mechanical complexity and enabling easier on-site servicing. Their lighter frames and simpler installation processes are particularly attractive for mobile operations, backup needs in remote sites, and temporary power setups. For example, Mahindra Powerol offers 400/500/625 kVA DG powered by Perkins 2000 series engines. These are turbocharged and air-to-air charge cooled with certifications up to Euro Stage IIIA/U.S. EPA Tier 3 and to India's CPCB-II emissions standards.
By application, standby backup power dominates the industry due to rising grid instability and infrastructure growth
Standby backup diesel generators register the largest market share because commercial buildings, hospitals, and telecom towers require total continuity during outages. Rising grid fluctuations, extreme-weather disruptions, and higher digital-load densities are some of the key factors that have pushed businesses to invest in dependable standby units. Manufacturers are equipping these gensets with automated transfer switches and low-noise enclosures that streamline response time and operational reliability. In March 2022, Mitsubishi Heavy Industries Engine & Turbocharger, Ltd. launched a new MGS-R Series of diesel generator sets, positively impacting the diesel generator market dynamics.
Peak-shaving diesel generators are becoming increasingly important as large commercial complexes and factories try to minimize peak-hour electricity charges. Industries facing volatile tariffs and rising power consumption are deploying gensets to offset loads during peak-time demand, improving operational economics.
By end use, the industrial sector occupies a substantial share of the market due to high load density
The industrial sector dominates diesel generator usage because most of the factories, refineries, and chemical units rely on stable and high-capacity backup power. Production lines, robotics systems, and process automation equipment cannot tolerate downtime. In turn, they invest in robust, large kVA gensets equipped with synchronization and remote-performance control. Skilled labor shortages and rising automation create further dependency on uninterrupted power.
The commercial segment is quickly boosting the chances for diesel generator market expansion as data centers and corporate campuses prioritize uptime in line with digital transformation and customer service expectations. These facilities integrate diesel generators with smart energy suites, automatic switching systems, and IoT-based diagnostics for predictable performance. The surge in HVAC loads, EV chargers, and refrigeration units also increases reliance on stable backup power.
Asia Pacific leads the market due to expanding industrialization and ongoing infrastructure investments
Asia Pacific remains the leading market for diesel generators. With rapid industrial expansion, construction booms, mining activity, and data center growth, the region has experienced significant diesel generator deployment. Countries such as India, China, Indonesia, Vietnam, and the Philippines continue upgrading industrial parks and transportation infrastructure, requiring consistent backup capacity.
The diesel generator market in the Middle East and Africa region is demonstrating fast growth due to heavy reliance on backup power across oil & gas sites, construction zones, mining operations, and expanding urban zones. Megaprojects in the Gulf, spanning smart cities, industrial clusters, and logistics platforms continue to deploy high-capacity diesel generators for baseline and emergency loads. Sub-Saharan Africa’s chronic grid instability further amplifies genset demand across commercial buildings, hospitals, and remote communities.
The global market is becoming more and more competitive as OEMs sharpen their focus on cleaner combustion systems, hybrid-ready architectures, and digital service layers that help customers maintain uptime with fewer technicians. Diesel generator market players are moving beyond conventional mechanical designs and introducing software-driven diagnostics, remote fleet management, and predictive maintenance models to extend engine life and optimize fuel efficiency. Rising demand from data centers, healthcare networks, and smart manufacturing hubs is creating room for premium, low-emission engines and synchronized multi-genset solutions.
Diesel generator companies also see opportunities in grid-constrained regions across Africa, South Asia, and Latin America, where rental fleets and modular generators are gaining momentum. Strategic partnerships with fuel companies, microgrid developers, and EPC contractors are emerging as the fastest route to expand installed bases.
Atlas Copco AB supports the market through portable, fuel-optimized, and telemetry-enabled units designed for construction, mining, and emergency response applications. The company, founded in 1873 and headquartered in Stockholm, Sweden, integrates smart controllers, variable-speed engines, and hybrid battery packs to help customers reduce fuel burn and noise emissions, boosting the diesel generator market growth.
Established in 1925 and headquartered in the United States, Caterpillar Inc., has emerged to be a major diesel generator manufacturer recognized for high-capacity gensets used across data centers, industrial plants, and large infrastructure projects. The company offers advanced parallel systems, low-emission engines, and integrated digital monitoring through Cat Connect.
Cummins Inc., founded in 1919 and headquartered in Indiana, United States, serves the diesel generator market with engines and alternators engineered for efficiency, low NOx levels, and strong load acceptance. Cummins also partners with data centers, commercial builders, and industrial EPC firms to customize multi-megawatt backup systems.
Generac Holdings Inc., founded in 1959 and headquartered in Wisconsin, United States, caters to the diesel generator market with residential, light-commercial, and mobile power solutions. Generac’s portfolio targets telecom towers, small enterprises, and emergency services through compact generators and hybrid energy storage pairings.
*Please note that this is only a partial list; the complete list of key players is available in the full report. Additionally, the list of key players can be customized to better suit your needs.*
Other key players in the market Aggreko Ltd., and AKSA Power Generation, among others.
Unlock the latest insights with our diesel generator market trends 2026 report. Discover regional growth patterns, consumer preferences, and key industry players. Stay ahead of competition with trusted data and expert analysis. Download your free sample report today and drive informed decisions in the market.
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*While we strive to always give you current and accurate information, the numbers depicted on the website are indicative and may differ from the actual numbers in the main report. At Expert Market Research, we aim to bring you the latest insights and trends in the market. Using our analyses and forecasts, stakeholders can understand the market dynamics, navigate challenges, and capitalize on opportunities to make data-driven strategic decisions.*
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In 2025, the market reached an approximate value of USD 24.20 Billion.
The market is projected to grow at a CAGR of 8.10% between 2026 and 2035.
The market is estimated to witness a healthy growth in the forecast period of 2026-2035 to reach about USD 52.73 Billion by 2035.
Manufacturers are expanding hybrid portfolios, integrating AI-based diagnostics, diversifying into rental fleets, strengthening dealer training, and forming co-development partnerships with EPC firms to accelerate adoption across data-intensive and grid-constrained markets.
The industry is expected to be augmented by the growing deployment of innovative solutions in diesel generators to bolster fuel efficiency, the increasing research activities to minimise greenhouse gas emissions, and the rising demand for diesel generators in industrial applications.
The major regions in the industry are North America, Latin America, the Middle East and Africa, Europe, and the Asia Pacific.
The major power ratings of diesel generator in the industry are low power generator (0-75 kVA), medium power generator (75-375 kVA), and high power generator (375 kVA and above), among others.
The various mobility segments available in the market are portable and stationary.
The major cooling systems available in the market are air cooled and liquid cooled.
The significant application segments of diesel generator are standby backup power and peak shaving.
The major end uses of diesel generator are commercial, industrial, and residential.
The key players in the market include Atlas Copoco AB, Caterpillar Inc., Cummins Inc., Generac Holdings Inc., Aggreko Ltd., and AKSA Power Generation, among others.
Emission compliance pressure, volatile diesel pricing, increasing competition from gas and hybrid systems, supply-chain bottlenecks, and customer demand for digital monitoring are some of the key challenges found in the market.
Explore our key highlights of the report and gain a concise overview of key findings, trends, and actionable insights that will empower your strategic decisions.
| REPORT FEATURES | DETAILS |
| Base Year | 2025 |
| Historical Period | 2019-2025 |
| Forecast Period | 2026-2035 |
| Scope of the Report |
Historical and Forecast Trends, Industry Drivers and Constraints, Historical and Forecast Market Analysis by Segment:
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| Breakup by Power Rating |
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| Breakup by Mobility |
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| Breakup by Cooling System |
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| Breakup by Application |
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| Breakup by End Use |
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| Breakup by Region |
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| Market Dynamics |
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| Competitive Landscape |
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| Companies Covered |
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| Report Price and Purchase Option | Explore our purchase options that are best suited to your resources and industry needs. |
| Delivery Format | Delivered as an attached PDF and Excel through email, with an option of receiving an editable PPT, according to the purchase option. |
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