NR1901

NEWS RELEASE                                                                                        JANUARY 2014

Investment in Fossil and Nuclear Plants Will Exceed $760 Billion in 2014

Fossil and nuclear power plants will invest $764 billion on new equipment and repair parts in 2014.   Sixty-five percent of the investment will be in coal-fired power plants. This is the latest finding in Fossil and Nuclear Power Generation: World Analysis and Forecast published by the McIlvaine Company.

2014 Fossil-fired and Nuclear Power Generation Market

Technology

Units

Coal-fired

Nuclear

Gas   Turbine

   

Existing

New

Existing

New

Existing

New

Capacity

GW

2400

130

440

16

1100

70

Total Investment

$

Billions

230

270

90

64

   35

75

Combined New and Existing

$ Billions

500

154

110

Despite the virtual moratorium on new coal-fired power plants in the U.S., the rest of the world will spend $270 billion on new coal-fired power plants in 2014. This contrasts with only $75 billion for gas turbine systems. Repair parts and upgrades of existing coal-fired power plants will generate revenues of $230 billion.

The reason for the large market at existing plants is the initiative by European and U.S. legislators and environmentalists to limit greenhouse gases. Environmental regulations make it impossible to build a coal-fired power plant in the U.S. and difficult to build one in Europe.

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, but the large investment in these power plants by other countries will result in coal-fired power continuing to be the most popular option.

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 and Nuclear Power Generation: World Analysis and Forecast click on: http://home.mcilvainecompany.com/index.php/markets/2-uncategorised/113-n043