EEE has Answers for Projects:They Should Consider K-Fuel Technology ?
Coal Projects Dwindle, But Remainder Packs $40 Billion Punch
SUGAR LAND--March 3, 2008--Researched by Industrial Info Resources (Sugar Land, Texas)--Even as the economics of building new coal-fired generation capacity scare off proposed projects, a stable of projects remains active to replace antiquated units and meet rising baseload capacity demand in the U.S. Today, there are about $40 billion worth of coal projects representing more than 18,000 megawatts (MW) that are still on track to begin construction within the next year or so. The number of active coal-fired projects is down significantly from last year as project owners continue to defer or cancel projects.
Britt Burt, Vice President of Industrial Info's Power Group said: "A record number of proposed new coal-fired generation projects over the last two years have turned into a record number of project cancellations or deferments, mainly due to the skyrocketing capital costs required to build new coal-fired generation." In addition, uncertainty regarding upcoming CO2 regulation has added to the fallout. "Nevertheless, coal projects continue to be developed and built due to rising demand for baseload capacity, which can't be realistically reached by short term options like renewable fuels and natural gas," Mr. Burt said.
In addition to planned projects, there are 36,000 MW of new generation - about 300 units of all fuel types - under construction in the U.S. These units are scheduled to come online between now and 2012. Coal accounts for 41% of that total, followed by natural gas with 33%, and renewable sources with 11%.
Click on the image at right to view a chart showing the breakdown of new generation under construction in the U.S. by fuel type.
At the end of 2006, Industrial Info was tracking about $23 billion worth of coal-fired projects planned in the U.S. That number had tripled by the end of 2007 to $60 billion. That number has further reduced to the aforementioned $40 billion today, and may continue to decline as the year progresses. Many projects are being deferred or put on the back burner while owners evaluate the changing economic landscape of the Power Industry. Several high-profile projects have been canceled during the last year, such as the FutureGen project.
On the supply side, coal mining companies in the U.S. are planning several new mines and mine expansion projects to meet projected demand for coal, not only from domestic sources but growing international demand. Industrial Info is currently tracking 41 projects representing more than $3.5 billion in total investment value (TIV). If built, these projects could add close to 131.8 million tons per year over the next several years. Coal demand is expected to continue to increase.
As U.S. coal mining and power generation companies grapple with the economics of expansion, one thing is for sure - change can be counted on.
Industrial Info Resources (IIR) is a marketing information service specializing in industrial process and energy related industries with products and services ranging from industry news, forecasting, plant and project databases, as well as multimedia advertising campaign assistance.
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