January 2017 - FGD and DeNOx Insights 73

Largest Revenue Generation in the World FGD Market Will Be in the Aftermarket

The market for flue gas desulfurization (FGD) systems, components and services will grow over the next eight years despite the environmental initiatives to reduce coal-fired power generation. This is the latest forecast in N027 FGD Market and Strategies. The Trump Administration will not be able to reverse the movement away from coal in the U.S. The main reason will be the continued low cost of natural gas. However, Asia will continue to build coal-fired power plants. As a result, by 2025 Asia will have a coal-fired power capacity three times larger than that of Europe and the U.S. at their peaks.

In 2008, the U.S. was winding up a big FGD retrofit program and China was in the middle of a combined FGD retrofit and new coal-fired power plant expansion. Thus, the market for new systems was over $10 billion.

World FGD Market $ Millions
Revenue Source	2008	2017	2025
New Systems	10,000	3,000	4,500
Outsourced Repairs, Replacement and O&M Support	6,000	12,000	20,000
In House O&M	10,000	18,000	18,000
Total	26,000	33,000	42,500

Due to the abrasive and corrosive slurries, high temperatures and sheer size of the FGD systems and components, the market for replacement parts, repair and service is substantial Since most coal-fired power plants around the world cannot continue to operate when SO₂ levels exceed requirements, there is a big investment in operation and maintenance.

Smart valves, pumps and fans are increasingly combined with software programs to provide remote operation of plants. As a result, a big market is developing for third parties to support the operations or even take over the operations of the systems. The first such example was in the 1990s when an Indiana power plant contracted with Mitsubishi and Air Products & Chemicals for a BOO system.

The opportunity to offer BOO systems and generate revenues from byproduct sales will be expanding. In the past, suppliers have offered to supply BOO systems and to generate revenues from the supply of ammonium sulfate. Byproduct gypsum is only a fraction of the value of ammonium sulfate. The biggest opportunity is the potential extraction of rare earths. A two-stage scrubbing system is likely to provide the lowest cost process to extract rare earths from flyash and at the same time generate hydrochloric and sulfuric acid.

Connecting Things, People, Intelligence, Niche Experts and Wise Crowds for Power Industry Decisions

GE, Emerson, Siemens and many other companies are creating software to connect things. There is a large potential for this in power generation. This potential was reflected in a number of papers and displays at the recent PowerGen Asia exhibition.

“We believe the success of our power generation customers will be more and more supported by the intelligent use of data generated by ever increasing connectivity of devices. The integration of those data with people expertise and knowledge will create additional services in a cycle delivering unprecedented knowledge of the behavior and potential of their assets,” said Marco Sanguineti, Head of Technology for ABB’s Power Generation business unit.

McIlvaine recently conducted nine hours of webinars focused on a problem for one utility. Presentations by Siemens, GE and Emerson addressed the optimization route to a lowest total cost of ownership (TCO) solution but the participants (wise crowd) concluded that incorporating innovative new technologies and components would be equally important in a system which would provide the lowest TCO.

Companies such as ABB are integrating the data from many thousands of sensors which are monitoring thousands of pumps, valves, mixers, fans, compressors, burners, conveyors, filters, etc. In a large utility with multiple plants, there are hundreds of individuals with specialized knowledge that may be valuable in a specific lowest TCO determination. As a result, there are likely to be many thousands of people who can contribute to the decision-making process. How do you take advantage of all this niche expertise?

Jeff Immelt of GE observed that the power industry needs to adopt the “hurry up” attitude of Silicon Valley in developing new technology. McIlvaine believes that this “hurry up” mode can best be achieved by decision systems which interconnect machines with people, intelligent databases and systems, niche experts and wise crowds. Systems have been created which provide the four knowledge needs: Alerts, Answers, Analysis and Advancement. The newest addition has been to supplement periodic webinars with very focused LinkedIn discussion groups. These groups facilitate “wise crowd” decisions by addressing all the criteria needed for a “wise crowd” to function properly.

Criteria	Description	LinkedIn role
Diversity of Opinion	Each person should have private information.	Small LinkedIn discussion groups lend themselves to extracting the niche expertise and unique ideas.
Independence	People's opinions aren't determined by the opinions of those around them.	The small LinkedIn discussion groups are not subject to the peer pressure of the large webinars. McIlvaine editors then integrate the conclusions reached in the discussion groups.
Decentralization	People can specialize and draw on local knowledge.	The small LinkedIn discussion group is the ideal way to extract the local knowledge and benefit from niche expert participation.
Aggregation	Some mechanism exists for turning private judgments into a collective decision.	The LinkedIn discussion groups are a bridge between analyses and webinars which result in the collective decisions.

The LinkedIn discussion groups are an important part of the entire interconnection system between:

· The final interconnection between all the many individuals in each of the above

Supplier knowledge can be transmitted through individuals who are encouraged by management to focus on becoming more expert. These individuals will be “rainmakers.” If they demonstrate that their company has the knowledge and the products to provide the lowest TCO, they can be very effective in boosting sales.

The same is true of consulting companies. However, the challenge will be to offer just enough expertise to achieve the rainmaking without reducing the potential actual consulting revenues.

· Washington State has blocked Plans for the Nation’s biggest Coal Export Terminal

· EPA analysis shows Wet FGD is most Cost-effective Route to meet Federal Implementation Plan

The 41F Utility E-Alert is issued weekly and covers the coal-fired projects, regulations and other information important to the suppliers. It is $950/yr. but is included in the $3020 42EI Utility Tracking System which has data on every plant and project plus networking directories and many other features.