NEWS RELEASE                                                                                                    AUGUST 2014

FGD Upgrades Will Assure a $5 Billion Annual Market

Revenues for FGD suppliers will average about $5 billion per year over the next five years. This will be split between upgrades of existing systems and new systems.  This is the latest forecast in McIlvaine FGD Market and Strategies.

Traditionally, most of the market has been for new systems.  The maturity of the market is established with the even split between new systems and upgrades by 2020.

FGD Supplier Revenues ($ Billions)




New Systems






The major markets for new FGD are now in Asia.  More than 70 percent of the new FGD orders in 2015 will be placed for Chinese power plants.

There is a large market developing to upgrade existing FGD systems. The biggest upgrade market will be China.  The government has identified 100,000 MW of FGD which must be upgraded.  Adding an extra spray section will be one of the upgrade measures. 

This forecast does not include consumables such as lime and limestone. Expenditures for these consumables have risen steadily and will continue to do so at a rate of approximately 5 percent per year until 2020.   After 2020, consumables expenditure growth will slow as the number of new coal-fired power plants built each year will be reduced and there will be increasing retirements of coal-fired power plants in Europe and the U.S.

This forecast is based on the assumption that a greenhouse gas reduction program is implemented.  There are mixed signals regarding the future of this program.  The U.S. has proposed a carbon trading program for coal-fired power plants which will result in retirement of nearly 50,000 MW of coal-fired capacity (20% of the existing fleet).   Australia has just repealed its carbon tax citing the high cost and lack of perceived benefits.

This forecast is also based on the continued success of the program to extract gas from shale. As long as gas prices remain at around $4-5/MMBtu, gas will be the preferred fuel for new power plants.  The U.S. is likely to generate all the gas it needs internally and will be able to export some quantity.  China has launched a big program to produce gas from coal.  This gas will be transported across the country and will fuel gas turbine plants in Eastern cities.

The Chinese gas-to-coal program will have the effect of reducing the longer range traditional FGD market. However, a very large air pollution market will be created to capture the H2S and particulate caused by the coal gasification process.

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