Mcilvaine Insights

No. 105   May 17, 2019

WELCOME

Weekly selected highlights in flow control, treatment and combustion from the many McIlvaine publications.

• Coal Fired Power Plant Combust, Flow and Treat Purchases will Exceed Those for Wind, Solar, Nuclear, and Gas Turbine Plants
• Power Industry will Spend $ 3.2 billion for Pumps Next Year

Coal Fired Power Plant Combust, Flow and Treat Purchases will Exceed Those for Wind, Solar, Nuclear, and Gas Turbine Plants

In the last 20 years an average of 50,000 MW per year of new coal fired power plants have been added to the world generation capacity. Over the next 10 years 40,000 MW per year  of new capacity will be added. This will be partially offset by retirement of 13,000 MW per year  of existing capacity.

Annual new plant investment will exceed $160 billion per year. The installed base of plants has now reached 2 million MW and will increase by 270,000 MW over the next decade. The investment in the installed base exceeds $4 trillion. Potential for third party upgrades, repair, service, and remote operation will exceed $200 billion per year. This includes major environmental upgrades in India and other countries in Asia, Eastern Europe, and Africa.

The climate change issue is dominant in certain countries but not relevant in others. The McIlvaine Company has created a metric to assess individual and national goals.  The metric is Quality Enhanced Life Days (QELD).  A struggling  Pakistani farmer is offered the choice of electricity or helping to protect the earth fifty years from now.  He will assign a much higher QELD to construction of coal plants in Pakistan than will a wealthy American who is creating trusts for his grandchildren. Sustainability Universal Rating System. 

China is making a  contribution to raising the standard of living for poor citizens of many Asian and African countries.  It is financing new power plants to supply the electricity needed by industry and families. Despite the investment in new coal plants or in many cases because of it the Chinese CO₂ emissions have been positively impacted by the reduction of inefficient fossil and biomass combustors in residential and commercial establishments.

Despite the claimed certainty relative to greenhouse gas damage by both sides of the issue, the science is not well understood. The intense debate over SO₂ emissions which has been waged for half a century has had many twists and turns.  McIlvaine testified before senate sub committees as an EPA contractor at the time it was thought that acid rain would kill forests throughout the world.  It was later determined that this impact would be much less than anticipated.  However, it was then determined that SO₂ reacts with sodium and ammonia in the atmosphere to form small particles with more impact on health than any other pollutant.

It is not only the health impacts which are unclear, there is considerable debate about the costs of various solutions. The U.K.  already generates 11 percent of its electricity from biomass combustion. The large coal fired Drax plant has switched from coal to biomass. A pilot program has been initiated to sequester the CO₂ with the claim that this is the only way for a combustion process to reduce CO₂.  The slogan is “Suck the CO₂ out of the air”. 

Use of CO₂ for enhanced oil recovery and sequestration has been practiced for many years. Proximity is the issue.  SaskPower is operating the first commercial coal fired power plant EOR system at its Boundary Dam plant. The use of CO₂ to replace water in hydraulic fracking looks very promising.  We could return to the 1980s era activity in the U.S. where multiple small coal fired boilers were constructed in the California oil fields for EOR.

Longer term solar and wind will gather market share in all regions of the world. In the short term countries without natural gas, limited solar and wind potential, and in urgent need of electricity will continue to build coal plants.  Energy storage developments could alter the picture. In any case in the last half of this century coal will play a diminished role in power. But over the next ten years there will be substantial activity in many  regions.

Africa:  New coal fired capacity is planned for seven countries with coal fired capacity and eleven with no coal fired capacity.  South Africa, Egypt and Zimbabwe are planning 40,000 MW of additional coal fired capacity. In many of the African countries the first coal plants will be owned by and for mining companies.

Asia:  China and India are planning more than 300,000 MW of new coal fired capacity. Vietnam is moving forward with 40,000 MW of capacity followed by Indonesia with 30,000 MW and Bangladesh with 25,000 MW.  China, South Korea and several other Asian countries have significant coal to chemicals programs.

Eurasia:  Georgia, Kazakhstan and Russia have more than 60,000 MW of coal plants in operation and have plans for an additional 10,000 MW.

Europe:  Despite the pressure from the EU, thirteen countries have new coal fired power plants in the planning stage. The total in Turkey is over 30,000 MW, Poland, 9,000 MW, and Bosnia-Herzegovina, 4000MW.

Americas: No new plants are planned in the U.S and Canada. Four Latin American countries are planning a total of 4,000 MW of new coal fired capacity. However, the continent will continue to operate nearly 300,000 MW of coal fired units at least over the next fifteen years.

The purchases of combust, flow and treat products and services by coal fired utilities worldwide will continue to exceed those by any other fuel  source. In part this is because sources other than nuclear spend much less per MW for CFT products and services.  The 42EI Utility Tracking System  provides forecasts of new capacity for each plant, each owner, and by country.  Specific forecasts by plant and owner for purchases of valves, pumps, chemicals, filtration equipment, FGD systems, NO_x control systems, fabric filters, precipitators, cooling towers, fans and other power plant products are displayed in the McIlvaine market reports shown at  http://home.mcilvainecompany.com/index.php/markets

Bob McIlvaine can answer your questions at rmcilvaine@mcilvainecompany.com  847 226 2391

Power Industry will Spend $ 3.2 billion for Pumps Next Year

Power plant purchasers will spend $3.2 billion for pumps next year. Sixty-seven percent of the purchases will be for Asian power plants. Decades ago many pump decisions for Asian power plants were made in other regions by international power plant developers. Today many Chinese power plant developers are making  pump decisions for Africa, the Middle East, and Turkey.

Most power plant operators including those in Asia are making decisions based on lowest total cost of ownership. This provides a window of opportunity for international suppliers with better products.

The challenge for international pump companies is to reach the decision makers. New plants are  being built in seven African countries which already have some coal fired capacity. Another eleven African countries will be installing coal fired power plants for the first time.  Vietnam is planning to move forward with an additional 40,000 MW of coal plants. Indonesia will add another 30,000 MW while Bangladesh with Chinese help is adding 25,000 MW of coal plants.

More money will be spent for pump replacement and repair than for pumps at new plants. There are already 2 million MW of coal fired plants installed worldwide.  The base will increase by 270,000 MW in the next decade even with the retirements in some countries. An additional pump market is created by SO₂ emission limits being applied in India and other Asian countries. The new regulations are also being applied in Africa. This means large FGD slurry pumps will be installed at many existing plants as well as at most new plants.

Regulations regarding water pollution are forcing plants to install treatment systems which include pumps needed to move the wastewater through filtration equipment.

The top fifty owners will buy more than 50 percent of all the power plant pumps. The top dozen will spend  $200 million or more on pumps each year.

More than 8,000 owners will spend at least $70,000 for pumps each year. McIlvaine can supply forecasts for pump purchases for 1300 owners operating 10,000 plants burning coal for either electricity generation or for industrial use.  Many of the new plants in Africa are solely for providing power for mining operations. Pump purchase forecasts can also be supplied for thousands of gas turbine, biomass, and geothermal power plant owners. Detailed forecasts are also available for nuclear pump purchases.

There are multiple tracking systems to identify each new project.  A weekly Utility E-Alert provides the latest insights.  The individual services which can be combined in a package are linked below.

N019 Pumps World Market

42EI Utility Tracking System

42EIC Chinese Utility Plans

41F Utility E-Alert

59EI Gas Turbine and Reciprocating Engine Supplier Program

A whole program built around individual owner forecasts’ is explained at www.mcilvainecompany.com

Bob McIlvaine can answer your questions at 847 226 2391 or rmcilvaine@mcilvainecompany.com