According to Sriram, Chinese manufacturers are competing very aggressively in Southeast Asia and Australia/New Zealand (ANZ) - markets which she says are already “cut-throat”.

“If we look at the 500kW to 1MW [genset] range, the average price is around US$0.8 million. But the Chinese products cost much less, around $0.5 million. So for the customer who is only looking for backup power, they’d rather have Chinese equipment than an established brand.”

Chinese genset manufacturers don’t have a service or distribution network in Southeast Asia or ANZ, says Sriram. “They don’t have a presence. But, a lot of local importers and packagers will buy their equipment and repackage them," she says.

The local distributors make for a small part of the large genset market, although they are stronger in smaller-capacity genset markets. Multinational OEMs - Caterpillar, Cummins, MTU Detroit Diesel, Mitsubishi, and John Deere - take around 85% of the Southeast Asian market says Sriram, while in ANZ they take a “major portion”.

But price is the major decision-making factor across all size ranges, says Sriram; this is squeezing profit margins of established players already beleagured by loss of market share from cheaper imports.

Overall, Sriram sees a robust market for stationary gensets in Southeast Asia. Market revenues reached US$281.1 million in 2006, and are forecast to reach US$504 million by the end of 2013.

Sriram sees particular potential in Indonesia, Phillipines and Vietnam. “You have a lot of remote areas, lots of islands which are not connected to the grid," she says. In addtional, the power infrastucture is less developed in these countries’ mainland areas.

Nevertheless, he says, standby power - rather than baseload - is the key driver for genset markets. In ANZ, 40-50% of the market is commercial building standby power, while around 30% is industrial standby. In Southeast Asia (excluding China), standby power accounts for around 90% of the genset market.

Sriram says diesel is still the most popular fuel, and will remain so until gas networks are sufficiently developed. While environmental considerations are driving new sales - concerns about noise regulations for example, are forcing users to continuously upgrade - renewable power itself is not a serious threat to the fossil-fired genset market.

“Where you might have a problem transporting a diesel genset [to a location], there’s potential for renewable,” she says, adding that solar and solar/diesel hybrid solutions are working out well in telecoms applications.