Released November 11, 2019 | SUGAR LAND
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Written by John Egan for Industrial Info Resources (Sugar Land, Texas)--The global Power Industry has about 5,800 capital and maintenance projects for electricity generation under construction, with an aggregate value of about $1.1 trillion, said Britt Burt, Industrial Info's vice president of research for the global Power Industry, in a web conference November 6. Burt noted that compared with a year earlier, the project count has increased by about 1,200, while the total investment value (TIV) for those projects under construction has declined by about $50 billion.
"Some of that is due to larger projects, including coal-fired generation, being cancelled or postponed," Burt said on the webinar.
An even broader look at all active future electricity projects--including transmission, distribution and in-plant maintenance--shows about 40,000 projects, valued at about $4.9 trillion, that are scheduled to kick off in the future. These projects are in the planning and engineering stages, and include maintenance projects.
"We don't expect all of those projects to begin construction according to their schedule," Burt told the webinar attendees.
Returning to electric-power projects under construction, Burt noted the following regions have the highest levels of project spending:
"The world remains heavily dependent on coal for baseload electricity," Burt said about generating units that are operating. But around the world, he added, there's more solar and gas-fired generation capacity under development than coal-fired capacity.
"By and large, we expect natural gas-fueled units will be replacing retiring coal and nuclear generation," he said. "Gas will be the go-to fuel as coal and nuclear units are retired."
In the U.S., Burt said, 2019 is the last year to begin construction of wind generation if developers want to receive a federal production tax credit (PTC). The investment tax credit (ITC) for solar generation is declining, but will still be available for units built after 2019.
The Trump administration's Affordable Clean Energy (ACE) rule has done nothing to slow the retirement of coal-fired generation, he continued. "So far in 2019, we have seen about 9,000 megawatts (MW) of coal generation retired, and by the end of this year, that number could rise by another 5,000 to 7,000 MW."
Speaking about project activity in the U.S. and Canada through yearend 2021, Burt said: "New capacity construction will be dominated by new solar and wind projects. Beyond 2019, wind and solar construction will continue to move forward without tax credits. Natural gas will continue to be the dominant fuel source for electricity generation. Nuclear generation continues to be in a difficult business climate. Battery energy-storage systems will continue across the region. And while the closure of coal generation has cut into the industry's overall maintenance-spending plans, that spending will remain healthy due to scheduled maintenance for gas turbines and nuclear reactors."
Beyond power projects already under construction, Burt summarized trillions of dollars in other projects that are scheduled to begin construction during 2020 and 2021. Scheduled project spending in these regions are in addition to projects under construction, Burt emphasized. The regions with the largest planned future spending include:
Industrial Info Resources (IIR), with global headquarters in Sugar Land, Texas, six offices in North America and 12 international offices, is the leading provider of global market intelligence specializing in the industrial process, heavy manufacturing and energy markets. Industrial Info's quality-assurance philosophy, the Living Forward Reporting Principle, provides up-to-the-minute intelligence on what's happening now, while constantly keeping track of future opportunities. Follow IIR on: Facebook - Twitter - LinkedIn. For more information on our coverage, send inquiries to info@industrialinfo.com or visit us online at http://www.industrialinfo.com/.
"Some of that is due to larger projects, including coal-fired generation, being cancelled or postponed," Burt said on the webinar.
An even broader look at all active future electricity projects--including transmission, distribution and in-plant maintenance--shows about 40,000 projects, valued at about $4.9 trillion, that are scheduled to kick off in the future. These projects are in the planning and engineering stages, and include maintenance projects.
"We don't expect all of those projects to begin construction according to their schedule," Burt told the webinar attendees.
Returning to electric-power projects under construction, Burt noted the following regions have the highest levels of project spending:
- East Asia, $372 billion
- Europe, $180 billion
- South Asia, $121.4 billion
- Western Asia/Middle East, $110.7 billion
- U.S. and Canada, $103.8 billion
- Africa, $83.4 billion
- Southeast Asia, $77.2 billion
- South America and Mexico, $43.2 billion
"The world remains heavily dependent on coal for baseload electricity," Burt said about generating units that are operating. But around the world, he added, there's more solar and gas-fired generation capacity under development than coal-fired capacity.
"By and large, we expect natural gas-fueled units will be replacing retiring coal and nuclear generation," he said. "Gas will be the go-to fuel as coal and nuclear units are retired."
In the U.S., Burt said, 2019 is the last year to begin construction of wind generation if developers want to receive a federal production tax credit (PTC). The investment tax credit (ITC) for solar generation is declining, but will still be available for units built after 2019.
The Trump administration's Affordable Clean Energy (ACE) rule has done nothing to slow the retirement of coal-fired generation, he continued. "So far in 2019, we have seen about 9,000 megawatts (MW) of coal generation retired, and by the end of this year, that number could rise by another 5,000 to 7,000 MW."
Speaking about project activity in the U.S. and Canada through yearend 2021, Burt said: "New capacity construction will be dominated by new solar and wind projects. Beyond 2019, wind and solar construction will continue to move forward without tax credits. Natural gas will continue to be the dominant fuel source for electricity generation. Nuclear generation continues to be in a difficult business climate. Battery energy-storage systems will continue across the region. And while the closure of coal generation has cut into the industry's overall maintenance-spending plans, that spending will remain healthy due to scheduled maintenance for gas turbines and nuclear reactors."
Beyond power projects already under construction, Burt summarized trillions of dollars in other projects that are scheduled to begin construction during 2020 and 2021. Scheduled project spending in these regions are in addition to projects under construction, Burt emphasized. The regions with the largest planned future spending include:
- East Asia, $664.4 billion
- South Asia, $497.5 billion
- Europe, $347.8 billion
- U.S. and Canada, $323.7 billion
- Africa, $316.5 billion
- Southeast Asia, $307.3 billion
- Mexico and South America, $238.7 billion
- Western Asia/Middle East, $156.7 billion
Industrial Info Resources (IIR), with global headquarters in Sugar Land, Texas, six offices in North America and 12 international offices, is the leading provider of global market intelligence specializing in the industrial process, heavy manufacturing and energy markets. Industrial Info's quality-assurance philosophy, the Living Forward Reporting Principle, provides up-to-the-minute intelligence on what's happening now, while constantly keeping track of future opportunities. Follow IIR on: Facebook - Twitter - LinkedIn. For more information on our coverage, send inquiries to info@industrialinfo.com or visit us online at http://www.industrialinfo.com/.
