Earlier this year, we launched the EIC Monitor, a quarterly index that uses the EIC’s database EICDataStream to track the status of more than 7000 projects across the global energy supply chain. Looking specifically at the power sector, what this revealed at the end of Q2 this year, was a staggering 50% decline in the number, value and capacity of new projects since Q3 2008, when the credit crunch began to bite.
Q2 2009 (running from April – June this year) revealed a continuous flat line on capacity for power projects totalling 68 GWe, however the total value of the 85 new projects in the sector stood at US$ 111 billion, up from US$ 85 billion on Q1 2009, but down from US$ 176 billion in Q2 2008. Figures for Q3 2009 are likely to show yet more signs of positive growth in the power sector.
Locating the hotspots
So where are the hotspots of activity? The signs are clearly pointing to India, China and the UK. Significant projects include two nuclear and one coal fired plant in China and three coal fired plants in India, all ranging in value from US$ 3 billion to US$ 7 billion and all with a capacity of between 2 GWe and 6 GWe. In the UK, notable projects include three proposed nuclear power plants – Bradwell B (US$ 8 billion), Sizewell C (US$ 16 billion) and Hinkley Point C, as well as the combined cycle gas turbine (CCGT) plants at West Burton, Pembroke and Staythorpe.
EICDataStream reveals that there are currently 534 current and future power projects across Europe. Other signs for optimism in the European power sector include the £40 billion new build nuclear programme for the UK and the National Grid announcing an extra £2 billion for its UK and US businesses by 2012, in addition to the £16 billion already announced.
As well as newbuilds, there are also significant opportunities for the global energy supply chain as industry and government looks to the use technologies such as Flue Gas Desulphurisation (FGD) and Carbon Capture Storage (CCS). The global CCS market is estimated to be worth US$ 100 billion/yr for the next 20 years, according to Nick Horler, Chief Executive of ScottishPower.
In order to best capitalise on new opportunities in the power sector, now is the time for major contractors and companies across the energy supply chain to work together more closely, with clear communications channels and a good knowledge of each other’s operating and procurement procedures.
Into the future
It is against this background that the EIC, in association with the UK Trade & Investment (UKTI), is holding EIConnect POWER 2009, 4 - 5 November, Manchester, UK. Dedicated to the UK energy supply chain, hundreds of representatives of UK energy companies and many of the world’s leading global operators and contractors will come together under one roof to discuss current projects and procurement requirements. Speakers include Alstom, Amec, Areva, CH2M Hill, GDF Suez, Doosan Babcock, EDF Energy, Electronuclear (Brazil), Fluor, Jacobs, Mitsubishi Heavy Industries, Punj Lloyd, RWE, Shaw Group, Siemens and URS, and the event is supported by the British Electrotechnical & Allied Manufacturers Association (BEAMA); The Nuclear Industry Association (NIA), and the Energy Institute.
With so much activity in the industry and a sense of organisations across the supply chain looking to work together more closely, I am optimistic that the global power sector is now on a course of positive long-term growth.
Author: Mike Major, CEO of the EIC. The EIC (Energy Industries Council) is the leading trade association for UK companies that supply capital goods and services to the energy industries worldwide. For further information on the EIC, EICDataStream and EIConnect visit www.the-eic.com
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