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NEWS RELEASE                                                                                                    NOVEMBER 2013

Investment of $790 Billion in Fossil and Nuclear Plants This Year

Fossil and nuclear power plants will invest $790 billion on new equipment and repair parts in 2013.   Fifty-six percent of the investment will be in coal-fired power plants. This is the latest finding in Fossil & Nuclear Power Generation: World Analysis & Forecast published by the McIlvaine Company. (www.mcilvain

2014 Fossil-fired and Nuclear Power Generation Market

Technology

Units

Coal-fired

Nuclear

Gas Turbine

 

 

Existing

New

Existing

New

Existing*

New*

Capacity

GW

2,300

100

474

20

1,300

100

Total Investment

$ Billions

240

200

100

80

   70

100

Combined New and Existing

 

$ Billions

 

440

 

180

 

170

 

* Added industrial gas turbines which were not included in previous forecast

Despite the virtual moratorium on new coal-fired power plants in the U.S., the rest of the world will spend $200 billion on new coal-fired power plants in 2014. This contrasts with only $100 billion for gas turbine systems. Repair parts and upgrades of existing coal-fired power plants will generate revenues of $240 billion. Chinese and U.S. power plants have major pollution control programs.

The future competition among these three major fuels will be shaped by a number of factors. The greatest variable is the quantity of shale gas which can be economically produced. The U.S. has potentially enough shale gas to meet present requirements for thirty years. China has even greater reserves, but they are located deeper and will be more expensive to extract. Furthermore, the Chinese shale gas industry is in its infancy. Even with its most ambitious plan, China’s gas production would only be eight percent of that in the U.S. in 2020.

The efforts to reduce greenhouse gases will virtually eliminate new coal-fired power plants as an option in certain countries. This sets up a chain of events whereby production of products requiring lots of energy input will be increased in countries which burn the cheaper coal. As a result, the fleet of world coal-fired power plants will keep growing.

Nuclear generation growth will also be highly regionalized. Some countries will not only avoid building new nuclear power plants, but will phase out existing ones. Other countries will be big investors in nuclear power. Nevertheless, this fuel option will continue to remain in third place far behind coal.

For more information on Fossil & Nuclear Power Generation: World Analysis & Forecast, click on:http://home.mcilvainecompany.com/index.php/markets/2-uncategorised/113-n043