Forecasts suggest that between 2004 and 2030, global electricity generation will double. Between 2001 and 2030, some 4700 GW of new generating capacity is expected to be built worldwide. About a third of this will be in developing Asia. In particular, the economies of China and India will require increasing amounts of electricity to continue their rapid development. Much of this will be provided by coal-fired power plants (see figure above).
In OECD countries, more than a third of current capacity is likely to be retired during this period; most of this will be coal-fired. Significant investment in new generating capacity will be needed, particularly between 2015 and 2030. World coal-fired generation capacity is forecast to rise from 1300 GW in 2006, to 1700 GW in 2011, reaching 2700 GW in 2030.
Some suppliers are having difficulties in meeting current demand for virtually all types of power plant equipment. This tightness of supply continues to impact on costs and delivery times. However, not all such problems arise solely from limitations in manufacturing capacity as various other factors affect the industry’s ability to supply, construct and operate new generating capacity. These include increasing delays with permitting, skilled labour shortages, regulatory uncertainties, environmental and political opposition, project financing problems, and securing fuel supplies.
As a result of the intense activity within the equipment supply sector in recent years, most major suppliers have been fully booked for some time. As a result, lead times for some engineered equipment increased by an estimated 50% during 2007-08. In some cases, longer delivery times resulted from delays with materials suppliers and sub-contractors. Although most suppliers are increasing manufacturing capacity for SC boilers, steam turbines and other advanced equipment, much of this new capacity has not yet been completed. As a result, supply of many key items is likely to remain tight for some time. Against a background of growing global demand, the cost of all types of power plant has risen rapidly. Prices for construction commodities and equipment have risen sharply as global demand has increased, leading to resource constraints. The cost of turning these commodities into components is also rising sharply. In Europe, the cost of new-build coal-fired power plants increased by up to 30% between 2005 and 2007. In North America, the cost of new plant construction has increased by 130% over 2000 levels. A power plant that cost US$1 billion in 2000 could now cost well in excess of US$2 billion. Rising raw material and equipment prices are impacting on ordering patterns and in some cases, projects have been deferred.
Factors similar to those impacting on the supply of coal-based generating equipment are also affecting the supply of environmental control systems. Furthermore, manufacturing constraints and other factors are also likely to impact on the supply of carbon capture and storage equipment, should widespread deployment become necessary. Many of the manufacturers and engineering procurement and construction companies who would undertake this work are already heavily committed in the power sector, and are expected to remain so for some years.
Meeting the demand for new coal-fired power stations
Steve Mills
CCC/141, ISBN 978-92-9029-460-3, November 2008
£255 non-member countries
£85 member countries
£42.50 educational price
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