Frost & Sullivan: Rise in Natural Gas Availability to Help Gas Turbines Edge Ahead of Steam Turbines
LONDON, July 31, 2014 /PRNewswire/ — The global gas turbine market has been on the upswing due to the rising replacement of ageing coal plants with modern gas-fired power stations as well as the growing availability and usage of natural gas in power generation. Market participants are also feeling optimistic due to the expansion of the global oil and gas industry, and the need for more flexible generating assets, owing to greater renewable energy generation.
Similarly, the global steam turbine market is experiencing a surge in demand due to the large coal-fired capacity additions in emerging markets such as China and India. Furthermore, the increase in the number of combined-cycle gas turbines (CCGT) plants, expansion of nuclear power, and upgrading of coal plants with supercritical and ultra-supercritical technology have all opened up the market for steam turbines.
New analysis from Frost & Sullivan, Global Gas and Steam Turbine Markets, finds that the market earned revenues of $32.51 billion in 2013 and estimates this to reach $43.49 billion in 2020.
"Although the current profitability of gas-fired generation is low in regions such as Europe, gas turbines will be the technology of choice for future capacity additions," said Frost & Sullivan Industry Director Harald Thaler. "Gas turbines will also benefit from increasingly stringent emissions legislation and roll out of emissions trading schemes in emerging markets, as they curtail the growth of steam turbines."
The rapid expansion of renewable energy has created uncertainties regarding the future of carbon markets, which, in turn, has affected the outlook for conventional generation. In this scenario, gas turbine manufacturers are focusing on the small- and medium-sized gas turbine output ranges to leverage the high demand for flexible generating units.
Likewise, small- and medium-sized steam turbine output ranges are forecast to outstrip the larger ranges due to a higher number of industrial applications, especially in the expanding oil and gas industry. Smaller units are also expected to have better financing prospects.
"The steam turbine market is expected to experience significant consolidation over the decade because of the presence of a large number of manufacturers and the growing internationalisation of Chinese OEMs," noted Thaler. "Comparatively, the gas turbine market will see limited acquisition activity beyond the recent Siemens-Alstom merger."
China is expected to become the leading gas turbine region as the position of the Middle East, hitherto the undisputed leader, declines gradually. China is aggressively promoting gas turbine plants in a bid to reduce dependence on coal plants and promote fuel diversification.
With regards to steam turbines, while China’s share of this market is forecast to decline over time — albeit remaining in a dominant position — India’s share will expand upon resolving coal shortage issues. Southeast Asia will also grow strongly as it looks to coal to reduce gas dependence. The European market, on the other hand, will remain weak amid uncertainty over future power demand growth and financially troubled utilities.
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Global Gas and Steam Turbine Markets is part of the Energy & Power (http://www.energy.frost.com) Growth Partnership Service program. Frost & Sullivan’s related studies include: Procurement Best Practices of Power Generation Utilities, Global Gas Gen-Sets Market, Global Hybrid Power Systems Market, Global Solar Power Market, Power Infrastructure Tracker in East Africa, and 2014 Asia Pacific Power Generation and T&D Market Outlook. All studies included in subscriptions provide detailed market opportunities and industry trends evaluated following extensive interviews with market participants.
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