Alternatives to Natural Gas Fired Power Plants Gaining Momentum

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Researched by Industrialinfo.com (Industrial Information Resources, Incorporated: Houston, Texas). The consensus at the Electric Power 2004, held last week in Baltimore, Maryland, was that the power industry is in a state of transition. The days of abundant new natural gas power plant construction are over; peaking in 2002, when close to 45,000 megawatts of new natural gas fired generation came online.

Click on the image at right to view the U.S. Operational Combustion Turbines by Start-Up Year Chart.

The power plant construction boom that started in the late 90's is over. The boom was brought about by demand growth, deregulation of the wholesale power market in the early 90's and the subsequent deregulation of retail power that has been accepted by some states and rejected by others. Today, the failure of deregulation in California has been replaced by the success of the deregulation model in the PJM interconnect RTO (Regional Transmission Organization). According to the PJM Interconnect website, "PJM ensures the reliability of the largest centrally dispatched control area in North America by coordinating the movement of electricity in all or parts of Delaware, Maryland, New Jersey, Ohio, Pennsylvania, Virginia, West Virginia, and the District of Columbia." The PJM plan is being hailed as a model conception, which can be modified, improved upon, and implemented for RTOs across the country. The FERC, RTO's, generators, and ratepayers across the country are busy defining the rules that will provide us with competitive and reliable power in the future.

In North America, supply issues and price increases have reduced the economy of the clean "fuel of choice," natural gas. This, along with government support of programs for clean fuel research, is leading to resurgence in non-natural gas fuel projects, including coal, nuclear, and renewables.

One project that the DOE is funding through a series of research projects will eventually lead to a billion dollar zero emissions coal plant. Known as the Futuregen project. Futuregen is a ten-year, $1 billion research project that will result in a 275 megawatt prototype power plant testing coal-to-hydrogen and CO2 sequestration technologies. A series of possible sites for the plant will be identified by the end of 2004. At the present time, construction on the plant is expected to begin in 2007.

Several industry leaders have stepped in with their own plans for clean coal plants. James E Rogers, Chairman, President and CEO of Cinergy Corporation stated that Cinergy was studying an IGCC (Integrated Gasification Combined Cycle) power plant replacement for one of the company's existing older coal-fired power plants on the Ohio River. The IGCC technology marries the best of both coal and natural gas worlds. Coal, the predominant contributor to existing power plants and the most abundant fuel in the U.S., is gasified and burned in combined cycle configuration. Natural gas combined cycle technology has been perfected and is utilized at a majority of new plants coming online in the last decade.

The hype around coal seems to be on the upswing, with recent articles in such publications as the Wall Street Journal proclaiming that there are "over 100 coal-fired power plant projects on the books, representing close to $72 billion." In actuality, talk surrounding increased planning for coal-fired power plants has been brewing since 2000, as the peak of natural gas plant construction was just beginning. See archived IIR Industry Alerts originally released in July of 2001: Coal Mining Stages a Comeback and Development of Coal Fired Power Plants Increases with Rising Demand for Electricity.

At that time, Industrialinfo.com reported 45 coal-fired power plant projects either under construction or in development and scheduled for completion between July 2001 and January 2009. The number of active project has been building up and today, Industrialinfo.com is tracking 89 separate coal-fired projects in North America, representing more than 43,000 megawatts. 56 of these projects are new plants, while the remaining 33 projects are coal-fired unit additions at existing plants.

For details on these projects or to order the new 2004 U.S. Coal-Fired Power Plants and Coal Mines Wallmap, contact: Industrialinfo.com's Member Center at 1-800-762-3361.

At the same time that the U.S. government is pumping billions into the development of clean coal technology, our neighbors to the north have varying attitudes about the future of the black fuel. Case in point, the province of Ontario has announced plans to close all the province's coal-fired power plants by 2007! Ontario operates five coal-fired power plants, which produce about 25% of the province's power.

Political and regional influences aside, there is abundant optimism circulating for coal and other natural gas alternatives for new power generation in North America.