New-Build Power Projects Blossom Where Older Projects Wilted in North America

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Researched by Industrial Info Resources (Sugar Land, Texas)--New-build projects in the North American Power Industry, which are projects that are under construction or are being planned for the future, are being driven primarily by the closures of fossil-fuel and nuclear generation facilities. About 85 gigawatts (GW) of fossil and nuclear capacity has been closed since 2010, according to Britt Burt, Industrial Info's vice president of global Power Industry research, who gave a detailed presentation on the status of North American new-build projects.

Click on the video below to listen to Burt discuss the outlook for new-build projects in the North American Power Industry.


The bulk of the closures--about 50 GW--comes from coal-fired facilities. Industrial Info is tracking about 27 GW of coal-fired capacity that is slated for closure through the end of 2020, according to Burt, as well as 10 GW of nuclear capacity. A lack of demand growth is among the factors driving the closures.

Of the roughly $317 billion in new-build projects set to begin construction between now and the end of 2020, Industrial Info currently estimates 386 projects worth about $112 billion have a high probability of kicking off.

Much of the development is attributable to renewable projects such as windfarms, which now generate about 10% of electricity consumed in North America, Burt said. The recent extension of tax credits for renewable energy sources, as well as state-level mandates for renewable generation, are among the biggest influences for this growth.

Burt expects to see 8 to 10 GW of wind power kick off each year through 2020, although he stressed that this number could widely fluctuate, depending on market conditions and government policies. Such factors also will affect the development of solar energy, which has a smaller, but growing, number of projects.

Nonetheless, Burt noted that natural gas is becoming "the predominant fuel of choice in the Power Industry," as the low prices for the fossil fuel are expected to hold steady in the coming years. Much of the new natural gas capacity is being built to replace retiring capacity, particularly coal-fired capacity.

Areas with a growing number of natural gas-fired facilities are widespread, including California, Texas, much of New England and various regions in Canada.

"Projections say that between now and 2038, we should see natural gas-fired capacity grow at about 3% per year, moving forward," Burt said.

Industrial Info is tracking about 34 GW of natural-gas fired capacity under construction, with an additional 87 high probability projects and $40 billion anticipated to kick off before the end of 2020. This number is expected to increase in the future.

Industrial Info Resources (IIR), with global headquarters in Sugar Land, Texas, five offices in North America and 10 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/.