The global District Cooling System industry is poised to increase at a steady CAGR of 3%, reaching US$ 1.28 Bn by 2032 from US$ 930 Mn in 2021.
Problems with the interface are frequent, particularly in new construction. Planning at the highest level is necessary to resolve these interface problems. The lack of equipment space presents the biggest construction challenge for district cooling technology. If industrial operations start up again and lockdowns are lifted, there will be greater demand for district cooling systems in the Middle East.
Major industries like manufacturing, chemical, and construction have had to shut down as a result of the epidemic’s severe damage to commercial and industrial operations. Access to manufactured goods has also been hampered by delays in logistics and transportation operations.
Tropical and hot climate populations require cooling, especially during the summer. According to the IEA, air conditioner ownership is rising in these areas. The Middle East is a 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.
Between noon and 5 p.m., the 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. District heating and cooling is a better way to cool and heat than traditional methods that use a lot of energy.
District cooling systems are time and money-consuming, and they demand careful planning. Installing the distribution network is very expensive. A substantial centralized production and distribution system is necessary for district heating and cooling. Costs associated with manufacturing and delivery are high as a result.
Large capital expenditures must be offset by decreased operating costs. To lower OPEX in a centralized facility, various district cooling manufacturing technologies can be used. The distribution grid is where about half of all investments are made. In high-density areas, district cooling technology is cost-effective; however, in low-density areas, it is ineffective. District cooling technology has a slower return on investment and is only appropriate for long-term use, which is causing hesitance among market players.
Competitive Analysis:
Major global district cooling market players are 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, and Stellar Energy.
Given the benefits of the district cooling systems, real estate developers, electricity utility, and gas utility companies are now also investing in establishing business models for district cooling. Emaar is one such real estate company of which an 80% stake was acquired by Tabreed in 2020 for a district cooling business in Downtown Dubai.
Key Segments
By Production Technique:
- Free cooling
- Absorption Cooling
- Electric Chiller
By Application:
- Commercial
- Residential
- Industrial
By Region:
- North America
- Latin America
- the Asia Pacific
- Europe
- Middle East & Africa
