The most rapidly urbanising and industrialising economies in Asia-Pacific (APAC) need energy security. While many also have ambitious decarbonisation targets, they have been clouded by the region’s soaring electricity demand, keeping thermal power firmly in the mix.
A new GlobalData report on the global steam and gas turbine market highlights the role of thermal power in burgeoning economies, particularly in China and India, where urbanisation and large-scale industrialisation are putting a strain on energy security. Senior power analyst at GlobalData and author of the report, Pavan Vyakaranam, tells Power Technology: “The combined pressures of sustained electricity demand, rapid industrialisation and the expansion of urban infrastructure in APAC ensure that national energy planning maintains a strong emphasis on securing firm thermal capacity, while balancing energy security, affordability and the transition toward sustainability.”
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This status makes the APAC region “stand out as the largest and most strategically vital market for steam and gas turbines within the global thermal power industry”, the report notes.
However, the two sectors are driven by different types of demand. Gas turbines are seeing uptake in markets looking for a balance between emissions targets and capacity demand. Meanwhile, steam turbines, the majority of which are used for coal-fired power, offer high capacity but a dirtier emissions profile, meeting the security need quickly but falling short of any environmental benefits.
As a result, the sectors are on related but distinct trajectories. While steam-powered assets are seeing a modernisation trend to improve emissions, gas-fired assets are being looked to as the cleaner cousin of thermal generation. Both have been accepted by APAC governments as a fundamental necessity for energy security in the medium term.
APAC’s dominance in the steam and gas turbine market
The GlobalData report estimates the value of APAC’s 2025 gas turbine market value at around $4.6bn. This is $1.8bn more than the second biggest market, the Europe, Middle East and Africa (EMEA) region, and far ahead of the Americas, which is less than 22% of APAC’s market.
Source: GlobalData Power Database, February 2026.
APAC is expected to maintain its dominance, with its gas turbine market forecast to be worth $7.4bn by 2030. This trend is tied to the key economic drivers of the region, which is seeing rapid urban development, particularly in East and South East Asia.
APAC had more than 2.2 billion urban dwellers as of March 2025, making it the world’s most populous urban region. Forecasts suggest that by 2050, APAC’s urban population will have increased by 50%. Massive growth means massive buildout, which unavoidably translates into huge electricity demand.
These circumstances have led to an acceptance of the need for thermal power in the region; however, this conflicts with many APAC countries’ decarbonisation targets. China has pledged to reach peak emissions by 2030 and net zero by 2060; Australia, Japan and Malaysia aim to achieve net zero by 2050, Indonesia by 2060 and India by 2070.
Gas turbines, especially when used in combined-cycle configurations, produce significantly lower carbon emissions compared to coal-fired steam turbines. Against a backdrop of ambitious decarbonisation goals, this makes them an attractive alternative to coal, on which many APAC nations remain reliant. The GlobalData report points out: “Policy measures aimed at reducing reliance on coal and improving air quality underpin APAC’s position as the most dynamic demand centre [for gas turbines].” However, while coal-fired steam turbines are carbon-intensive and produce more emissions, soaring baseload demand has kept the technology in the conversation, particularly in the case of APAC.
Steam turbines are typically larger than gas turbines and offer a higher maximum power capacity. The sector therefore lends itself to easier scale-up and greater power generation – two considerations that make it an attractive generation option for governments looking to support rapid demand growth.
According to analysis by think tank Ember, Asia is experiencing faster power demand growth than any other region at approximately 5% annually.
In line with this finding, APAC was the largest market for steam turbines in 2025, with 76.9% of the global market share. It dwarfs other regions, with the second largest being EMEA, which only contributes 14.6% to the global share.
Source: GlobalData Power Database, February 2026.
The lead translates into buoyant domestic industries too, with Asian original equipment manufacturers, particularly in China, India and South Korea, at the forefront of global turbine manufacturing for both steam and gas turbines, driven by large-scale production and robust domestic demand.
However, the steam turbine trajectory is likely to be one of change, according to the GlobalData report: “International decarbonisation efforts, particularly those arising from the Paris Agreement, are significantly shaping steam turbine investment patterns. Coal phase-out policies, the introduction of emissions performance benchmarks and the adoption of carbon pricing mechanisms are collectively constraining new coal-based steam turbine installations.”
As a result, APAC countries are seeing a modernisation trend around existing thermal assets; supercritical and ultra-supercritical steam technologies are being used to increase thermal efficiency, in addition to an uptick in the deployment of digital monitoring solutions.
Urbanisation, industrialisation and electrification: the APAC drivers
The report identifies three key drivers for the growth of the steam and gas turbine markets: urbanisation, industrialisation and the need for reliable grid operation.
These factors, Kumar says, “lead to sharp increases in electricity demand across residential, commercial and industrial sectors, creating concentrated pressure points within power infrastructure.
“This heightened and localised demand makes a resilient, uninterrupted electricity supply critical, while also increasing the risk of grid overloads and outages if infrastructure upgrades or supply diversification do not keep pace.”
There is rapid industrialisation happening across the APAC region, particularly in South East Asia and India, which is forecast to be the world’s largest and fastest-growing market for energy services until the middle of the century. India is pushing to become an industrial leader in technology, electronics and green energy. Government initiatives including ‘Make in India’ and ‘Start-up India’ have sought to position India as a global manufacturing hub. In 2022, it overtook Britain to become the fifth-largest economy, and the International Money Fund expects India to overtake Japan in fourth place in 2026.
Meanwhile, Vietnam has become a key electronics and textiles manufacturing hub, having benefitted from the ‘China-Plus-One’ strategy that emerged in the mid-2000s. Malaysia, Thailand and Indonesia have also seen increased industrialisation on the back of the investment framework: Malaysia is a prominent destination for semiconductor, packaging and technology manufacturing, Thailand is a major automotive production centre and Indonesia is growing in popularity for electric vehicle assembly.
China, on the other hand, has long been an industrial hot spot: it accounts for more than 75% of lithium-ion battery manufacturing globally and over 80% of solar module production. It has also become a dominant force in the technology sector and remains the primary player in many heavy industries, including steel production.
With rapid industrialisation, the APAC region witnessed a 192% increase in electricity consumption per capita between 2000 and 2023. The effect of the increase is magnified by the rapid population growth, which stood at around 3.7 billion in 2000, compared to 4.8 billion in 2024.
“In many APAC markets, infrastructure development often lags behind this surging demand, intensifying challenges related to grid stability and supply chain resilience,” comments Kumar. “To manage these pressures, APAC power systems are increasingly focused on maintaining baseload reliability – primarily through steam turbine generation – while also expanding the deployment of flexible gas turbine technologies. This dual approach is essential for accommodating demand volatility and supporting the integration of variable renewable energy sources.”
Understanding the global steam and gas turbine picture
Decarbonisation strategies and net-zero commitments are reshaping gas and steam turbine markets. Although fundamental to energy security now, thermal dependency has an eventual government-issued expiry date, making policy the primary driver for change.
As the GlobalData report notes: “Policy frameworks at the international and national levels are exerting significant influence over the market’s trajectory.”
It highlights frameworks such as the Paris Agreement Policy, which are designed to reduce emissions, naturally driving a transition away from high-carbon assets. In Europe, REPowerEU is the European Commission’s platform to support the clean energy transition while limiting the EU’s dependence on Russian fossil fuels; it directs investments for energy security, including around natural gas sources and hydrogen infrastructure, which the report points out is “thus driving the development of hydrogen-ready gas turbine facilities”.
In the US, the Inflation Reduction Act (IRA) offers tax credits for carbon capture and storage (CCS) and clean energy generation. As gas turbines can be configured for CCS and used in hydrogen co-firing, the report says the IRA “bolsters” the gas turbine market in the US. It also points out the role of emissions standards issued by the Environmental Protection Agency, which incentivise adoption of high-efficiency combined-cycle gas turbines (CCGT) and the upgrading of existing steam turbine units with cleaner technologies.
“Together, these measures are leading to a recalibration of project economics, encouraging the shift from conventional subcritical coal plants to modern, flexible and environmentally compliant thermal infrastructure in the US,” the report states.
In the Middle East, there is a trend of expanding gas-fired power plant fleets as a cleaner transitional option, with CCGT plants replacing traditional oil-fired units. In particular, Saudi Arabia is developing projects such as Taiba 1, 2, Qassim 1, 2, Rumah 2 and Nairyah 2, adding more than 7GW of combined capacity. The national Saudi Vision 2030 strategy is demonstrative of the nation’s prioritisation; it aims to position Saudi Arabia as a global clean energy leader by diversifying away from oil. Other regional strategies, including the UAE Energy Strategy 2050, are further moving the sector away from steam-powered turbines but still supporting robust demand for large-scale gas turbines.
The energy security question means APAC faces a more delicate balance, which policy frameworks broadly reflect. Kumar explains: “Unlike the relatively stable urbanisation and well-established grid infrastructure seen in Europe and North America, APAC countries are navigating rapid urban migration and accelerated industrialisation, leading to significant and localised surges in electricity demand across residential, commercial and industrial sectors.”
The report concludes: “In such markets, the primary new business opportunities lie in modernisation projects and emissions-compliant retrofitting rather than greenfield coal developments.”
