Heat Recovery Steam Generator Market – Global Industry Size, Share, Trends, Opportunity, and Forecast, Segmented By Design (Horizontal Drum Units, Vertical Drum Units), By Application (Cogeneration, Combined Heat & Power), By Power Rating (Up to 30 MW, 31 MW - 100 MW), By End-user (Utility, Chemicals), By Region, By Competition Forecast & Opportunities 2021-2031F

Forecast Period	2027-2031
Market Size (2025)	USD 1.56 Million
CAGR (2026-2031)	5.25%
Fastest Growing Segment	Chemicals
Largest Market	North America
Market Size (2031)	USD 2.12 Million

Market Overview

The Global Heat Recovery Steam Generator Market is projected to grow from USD 1.56 Million in 2025 to USD 2.12 Million by 2031 at a 5.25% CAGR. A Heat Recovery Steam Generator (HRSG) is a heat exchanger that captures thermal energy from hot exhaust gases, primarily from gas turbines or industrial processes, to generate steam for electricity, heating, or other applications. The market's expansion is driven by the increasing global demand for energy-efficient power generation, especially combined cycle systems, and an industrial imperative to reduce operational costs. Additionally, growing pressure to lower carbon emissions through improved energy utilization supports HRSG adoption.

According to COGEN Europe's 2024 Snapshot Survey, renewable energy sources comprised over 25% of the primary energy used in European Union cogeneration plants. Nevertheless, a significant challenge impeding market expansion is the substantial initial capital investment required for HRSG installations. This financial outlay can be a barrier for project developers and industrial operators, potentially delaying or preventing new deployments, particularly in regions facing economic uncertainty.

Key Market Drivers

The growing adoption of Combined Cycle Power Plants (CCPPs) for enhanced efficiency is a pivotal factor driving the global Heat Recovery Steam Generator market. HRSGs are indispensable components within CCPPs, capturing exhaust heat from gas turbines to generate additional steam for power production, significantly boosting overall plant efficiency and reducing fuel consumption. This inherent capability makes HRSGs central to modern, high-efficiency power generation. The robust demand for new CCPP installations directly translates into increased orders for HRSG units globally. According to GE Vernova, in its December 2025 investor update, the company anticipates ending 2025 with an 80-gigawatt backlog for gas turbines, extending into 2029, indicating sustained growth in the segment that relies heavily on HRSG technology.

Concurrently, increasing global investment in clean energy and decarbonization initiatives significantly fuels the HRSG market. As industries and governments worldwide intensify efforts to reduce greenhouse gas emissions and transition towards lower-carbon operations, HRSG technology plays a crucial role by maximizing energy recovery from industrial processes and power generation, thereby lowering the carbon footprint. These initiatives often involve modernizing existing facilities or developing new, more energy-efficient plants that incorporate advanced heat recovery systems. The European Commission, in February 2026, awarded EUR 2.9 billion in Innovation Fund grants to support decarbonization projects, highlighting substantial financial commitments towards cleaner industrial operations. Furthermore, Doosan Škoda Power reported in March 2026 that its backlog for 2026 reached nearly 13 billion CZK, representing an increase of over one-third compared to the prior year, underscoring the broader market expansion for power generation equipment, including HRSGs.

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Key Market Challenges

A significant challenging factor impeding the expansion of the Global Heat Recovery Steam Generator (HRSG) Market is the substantial initial capital investment required for these installations. This considerable financial outlay acts as a direct barrier for project developers and industrial operators. It frequently leads to delayed investment decisions or, in some cases, the outright prevention of new deployments, particularly within economically sensitive regions where capital access is more constrained.

The high cost of securing project financing further exacerbates this challenge. According to the International Energy Agency, in 2025, the cost of capital for renewable power projects in emerging markets and developing economies was at least double the amounts observed in advanced economies. Such elevated financing costs directly undermine the financial viability and attractiveness of projects, thereby slowing the adoption of energy-efficient HRSG technology. This disproportionate financial burden restricts market growth, especially where investment in new industrial and power generation capacity is crucial.

Key Market Trends

The emergence of modular and standardized HRSG designs is a significant trend, addressing the market's demand for faster deployment and reduced on-site construction complexities. These pre-engineered solutions facilitate quicker manufacturing and installation processes, leading to decreased project timelines and lower associated labor expenses. This approach allows for greater flexibility and scalability, enabling quicker responses to evolving energy demands. For example, NEM Energy Group, a notable supplier, has delivered dozens of modular HRSG units for industrial gas turbines, underscoring the increasing industrial acceptance and practical application of this design philosophy in diverse power generation settings.

Another pivotal trend is the expansion of HRSG applications into green hydrogen production, where waste heat recovery is essential for enhancing the overall efficiency and economic viability of electrolysis processes. As the global drive for decarbonization accelerates, green hydrogen facilities are increasingly integrating heat recovery systems to optimize energy utilization from electrolyzers, which generate considerable heat. This integration directly contributes to lowering the levelized cost of hydrogen. According to the International Energy Agency (IEA), in its February 2026 analysis, global low-emissions hydrogen production reached nearly 1 million tons in 2025, highlighting the substantial and growing scale of this new market segment for HRSG technology.

Segmental Insights

The Chemicals segment is emerging as the fastest-growing application within the Global Heat Recovery Steam Generator Market. This acceleration is primarily attributed to the chemical industry's increasing demand for effective energy management and the pursuit of lower operational costs. Chemical facilities are progressively integrating Heat Recovery Steam Generators to efficiently capture waste heat generated from various processes, thereby significantly improving overall energy efficiency and fostering sustainable industrial practices. This strategic adoption is further driven by the necessity to comply with tightening carbon emission regulations and to mitigate the impact of volatile energy prices, ensuring enhanced resource utilization and environmental adherence across the sector.

Regional Insights

North America emerges as a leading region in the global Heat Recovery Steam Generator market, primarily propelled by stringent environmental regulations and significant investments in advanced energy infrastructure. Regulatory bodies, such as the U.S. Environmental Protection Agency, implement measures focused on reducing greenhouse gas emissions and improving energy efficiency within the power sector. This robust regulatory framework encourages the widespread adoption of heat recovery steam generators, particularly in combined cycle power plants, to efficiently convert waste heat into electricity. Moreover, the region's continuous focus on upgrading aging infrastructure and expanding industrial cogeneration applications substantially contributes to market expansion.

Recent Developments

• In March 2026, Turboden, an Italian manufacturer of large heat pump systems, successfully launched what was described as the world's largest steam-producing heat pump at a specialty paper plant. This system integrates mechanical vapor recompression with electric heat pump technology to generate superheated steam at approximately 350 degrees Fahrenheit. The installation demonstrated efficiency exceeding initial expectations by 10% and represents a notable advancement in industrial steam production, providing an alternative to traditional combustion boilers.
• In November 2025, Alfa Laval introduced a new once-through steam generator (OTSG) designed for modular thermal energy storage systems utilizing molten salt as a heat transfer medium. This high-efficiency OTSG aims to support both renewable and hybrid energy plants, offering a compact and durable solution for advanced thermal storage technology. It integrates with renewable energy sources, such as solar photovoltaic systems, to form power plants with capacities ranging from 2-10 MW, aligning with the global objective to decarbonize power generation and enhance energy flexibility.
• In March 2025, Fuji Electric, a Japanese electrical equipment company, was engaged in the initial prototyping phase for a new steam-generating heat pump system. This system is engineered to recover heat energy from industrial wastewater. The goal is to produce steam at a temperature of 150°C, an increase from their existing 120°C systems. This development is expected to enable new applications such as sterilization and degreasing, in addition to existing cleaning capabilities, with commercial availability anticipated in 2026.
• In March 2025, Bharat Heavy Electricals Limited (BHEL), an Indian power equipment manufacturer, formed a partnership with Vogt Power International Inc. (VPI) to enhance its capabilities in the heat recovery steam generator (HRSG) sector. This collaboration aimed to strengthen BHEL's technological expertise in HRSG design and supply, thereby maintaining its competitive position in combined-cycle and cogeneration power projects. Vogt Power International Inc., a United States-based entity, specializes in HRSG designs and engineering services for efficient steam generation.

Key Market Players

• Thermax Limited
• Siemens AG
• Mitsubishi Hitachi Power Systems Ltd
• AC BOILERS SpA
• Kelvion Holding GmbH
• General Electric Company
• Alfa Laval AB
• Mersen SA
• Sofinter SpA
• Alstom SA

By Design	By Application	By Power Rating	By End-user	By Region
Horizontal Drum Units Vertical Drum Units	Cogeneration Combined Heat & Power	Up to 30 MW 31 MW - 100 MW	Utility Chemicals	North America Europe Asia Pacific South America Middle East & Africa

Report Scope:

In this report, the Global Heat Recovery Steam Generator Market has been segmented into the following categories, in addition to the industry trends which have also been detailed below:

• Heat Recovery Steam Generator Market, By Design:

• Horizontal Drum Units
• Vertical Drum Units

• Heat Recovery Steam Generator Market, By Application:

• Cogeneration
• Combined Heat & Power

• Heat Recovery Steam Generator Market, By Power Rating:

• Up to 30 MW
• 31 MW - 100 MW

• Heat Recovery Steam Generator Market, By End-user:

• Utility
• Chemicals

• Heat Recovery Steam Generator Market, By Region:

• North America
• United States
• Canada
• Mexico
• Europe
• France
• United Kingdom
• Italy
• Germany
• Spain
• Asia Pacific
• China
• India
• Japan
• Australia
• South Korea
• South America
• Brazil
• Argentina
• Colombia
• Middle East & Africa
• South Africa
• Saudi Arabia
• UAE