Market size and competition landscape of China's waste heat recovery industry in 2025

The market size of China's waste heat recovery industry is expected to reach about RMB 300-350 billion in 2025. This estimate is based on China's share of about 40% in the global waste heat recovery market and the continued expansion of the domestic waste heat equipment and service market.

From the perspective of market structure, China's waste heat recovery is mainly concentrated in high-energy-consuming industries such as steel, cement, and chemicals. These industries account for more than 75% of waste heat resources, but the current utilization rate is still less than 35%. It is estimated that the waste heat resources that can be recovered in the industrial field each year are approximately equivalent to 1.37 billion tons of standard coal, and there is huge room for improvement.

Industry growth is mainly driven by the following three aspects:

First, policy support. The 14th Five-Year Plan and the National Energy Conservation and Emission Reduction Action Plan clearly state that by 2025, the industrial waste heat recovery rate must reach 50% to 60%, and promote the combination of contract energy management model and green finance.

Second, there is a need for transformation of high-energy-consuming industries. Traditional manufacturing has low energy efficiency and urgently needs to reduce carbon emissions and operating costs through waste heat recovery.

The third is technological progress. Medium and low temperature waste heat recovery technology (such as organic Rankine cycle ORC) has been basically localized, and the equipment cost is about 40% lower than that of international brands. High temperature waste heat equipment still mainly relies on foreign technology such as Germany and Japan, but domestic substitution is gradually advancing.

In terms of competition, Chinese local enterprises are transforming from single equipment suppliers to system integration service providers. Typical representatives such as Degut, Shuangliang Energy Saving, and Hangzhou Boiler Group can already provide integrated services such as waste heat boilers, heat exchangers, system control, and energy trusteeship. Some enterprises are also expanding the market through contract energy management (EMC) and financial leasing models, especially in the fields of petrochemicals and metallurgy to form a stable customer base.

In terms of regional markets, East China accounts for more than 40% of the waste heat utilization market due to its intensive manufacturing industry. Northwest China has become one of the fastest growing regions in the industry in the past two years due to its energy structure transformation and policy support, with an annual growth rate of more than 18%.

In addition, as domestic equipment technology improves, China's waste heat recovery equipment begins to be exported, with Southeast Asia and the Middle East becoming key markets. In 2024, China's waste heat boiler exports will exceed Germany, demonstrating its international market competitiveness.

Overall, China's waste heat recovery industry is at the intersection of policy-driven, technological breakthroughs and industrial upgrading. The market space is broad, the concentration of leading companies is increasing, and the industry is moving towards a more efficient, smarter and greener direction.