North America's Natural Gas-Fired Peaking Power Units Grow in Popularity

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Researched by Industrial Info Resources (Sugar Land, Texas)--Natural gas-fired peaking power units are being installed across North America to address coal-fired power plant retirements, regional load growth, and the ability of these fast-start facilities to follow load fluctuations caused by the growing number of renewable energy projects.

Industrial Info is tracking 31 simple-cycle, natural gas-peaking unit additions in North America, which have a total investment value of $8.24 billion. The top market regions include the West Coast, with six projects worth $1.82 billion; the Northeast, with four projects worth $1.74 billion; and the Southwest, with six projects valued at $1.47 billion.

Projects in this category that are scheduled to begin construction between January 2015 and December 2016 total 15, with a total investment value of $3.79 billion. The West Coast includes two projects worth $880 million; the Northeast has two projects worth $860 million; and the Southwest has three projects valued at $685 million.

In comparison, in late 2013, Industrial Info was tracking 22 simple-cycle capital projects valued at $6.4 billion. The top market regions at that time were the Southwest, with five projects valued at $1.4 billion; the Northeast, with three projects valued at $1.19 billion; and the West Coast, with three projects valued at $1.08 billion.

Simple-cycle combustion turbines are fast-start units capable of being brought online in minutes, compared to hours for conventional fossil-fuel steam turbines.

For related information, see October 6, 2014, article - U.S. to See $87 Billion in Project Kick-Offs Before End of Year, with Four Industries Touting Billion-Dollar Highlights.

With 42 gigawatts of coal-fired generation to be retired by 2025, peaking units have become a popular choice for power generators to avoid future load deficits and to meet the regional peaking needs of today's power grid. An example is in California, where combined ramping capacity may be insufficient to maintain grid stability to assure against brownouts during the hottest times of the year.

With simple-cycle combustion turbines currently costing between $839 and $1,285 per kilowatt to construct, and the low cost of natural gas, these fast-start generators will be one of the first choices by independent power producers and utilities.

Industrial Info Resources (IIR), with global headquarters in Sugar Land, Texas, three 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.