Middle East District Cooling Market size surpassed USD 4 billion in 2021 and is anticipated to grow at over 9% CAGR between 2022 and 2028. High reliability and increased energy efficiency are few of the paramount features offered by district cooling systems which will boost the business trends. Moreover, minimal environmental emissions along with implementation of stringent emission norms across Middle East will further complement the industry outlook.
Introduction of several governmental rebates, schemes and tax credits for the deployment of sustainable technologies including district cooling will proliferate the product penetration in the region. District cooling systems are said to reduce the energy consumption by up to 40%, which in turn will aid the homeowners, commercial offices and industries to reduce their electricity bills significantly. Additionally, extreme climatic conditions across majority of the countries in the MEA will propel the demand for effective cooling technologies.
Electric chillers-based district cooling market is estimated to reach USD 4 billion by 2028. Stringent emission norms coupled with reforms and policies pertaining to deployment of clean HVAC systems will positively sway the product adoption. Furthermore, steady advancements in heating and cooling technologies to reduce the maintenance & operational cost of these units will stimulate the market demand.
Silent & clean operations, lower energy consumption and shared capital cost across a district are few of the key features offered by these systems which will fuel the usage for electric chiller-based district cooling technology. However, ability to deliver high coefficient of performance with high centralized cooling power in comparison with single air-conditioning units across residential and commercial sector will proliferate the business landscape across the region.
Middle East district cooling market size across residential sector is projected to witness 8% gains through 2028. Rising investment toward the refurbishment of residential establishments and growing expenditure toward introduction of sustainable technologies will drive the market revenue. For instance, in 2020, Qatar district cooling company announced the signing of a contract to construct its fifth cooling plant in Qatar which will serve 73 varied villas, 659 residential units and 15 multi-family building across the country. Furthermore, soaring energy prices with rising concerns toward energy security is expected to spur the need for energy efficient technology.
Rising concern toward increasing carbon emissions from residential HVAC units will augment the demand for clean technologies including district cooling systems. Growing urbanization across the region coupled with increasing requirement for reliable and efficient technologies across the residential buildings will sway the product deployment. Additionally, easy control & monitoring and economical operations & maintenance will benefit the homeowners significantly.
UAE district cooling market revenue is predicted to register growth rate of about 8% through 2028. Rising investment toward the refurbishment of commercial establishment including institutes, offices and hotels amongst others will propel the industry spectrum. Ongoing efforts by policy makers to comply with energy conservation targets and gradual shift toward optimization of energy -efficient cooling across residential, commercial, and industrial establishments will drive the business expansion.
Moreover, the government of UAE has introduced various energy pricing reforms in order to reduce emissions, enhance efficiency and encourage private & public investments toward deployment of sustainable technologies and renewables will foster the district cooling industry growth.
Over the last few years, several industries have faced a decline in product deployment across the globe on account of imposed lockdowns by the government pertaining to the ongoing coronavirus pandemic. Majority of companies functioned with limited operations, owing to shortage of raw materials from lower-tier suppliers, less availability of manpower, and slow recovery of the logistics network. However, the demand for district cooling systems is likely to increase gradually across the commercial and residential sector due to the growing need for highly economical and efficient cooling solutions. In addition, gradual lifting of lockdown to boost the economy will fuel the regional demand.
Strategic acquisitions, partnerships, contracts, agreements and product innovations are amongst the key strategies implemented by the major players across the MEA market to enhance their presence. The firms are investing in R&D activities to develop new technologies in order to achieve economies of scale and gain a competitive edge. The key industry participants are engaging in backward and forward integration with component manufacturers and raw material suppliers to support their revenue streams.
Eminent companies operating across the Middle East district cooling market include Emirates Central Cooling System Corporation (Empower), Stellar Energy, Shinryo Corporation, National Central Cooling Company PJSC (Tabreed), Emicool, SNC Lavalin, ARANER, Pal Cooling Holding and Veolia amongst others.
