Power Engineering - New Year prediction for FGD

23 December 2005 - Orders for flue gas desulphurization (FGD) systems for power plants around-the-world will soar to $7.8bn in 2006 but will then fall back to an average of $5bn/yr over the next three years as suppliers scramble to build capacity, according to the latest forecast from the McIlvaine Company.

The firms World FGD Markets, a continually updated online service, had suggested that the market would taper off after the $15bn investment to meet the regulatory requirements of the US Clean Air Interstate Rule (CAIR) which has an interim 2010 deadline. But it now says that there are a number of developments which insure that the longer-term market will be sustained at $5 billion/yr or more. These developments include, activity in China
and in many other countries around-the-world including Chile, the switch from natural gas to coal for new coal-fired plants as well as some existing plants, high price of allowances and the need for multipollutant control including mercury.

There has been a complete reversal over the last five years. Coal is now expected to increase its market share and natural gas is going to lose market share in power generation. Owners, instead of hesitating to invest in upgrading existing coal-fire plants, are realizing that a modest increase in generating capacity would warrant substantial capital expenditures for scrubbers.

Over the next ten years the Chinese will invest even more than the U.S. in FGD systems. Other countries in Asia will also be significant purchasers of FGD. Europe will be burning coal more efficiently with new super critical boiler plants all equipped with FGD.

Latin America which has not previously shown any signs of FGD activity has become a promising market.

One of the biggest factors in growth of the FGD market will be multi-pollutant control. Recent studies show that with the use of chemical additives, FGD systems can remove 90 percent of the mercury, hydrogen chloride and hydrogen fluoride. FGD systems will also remove cadmium, arsenic, lead, copper, chromium and other toxic metals. In addition, FGD systems remove fine particulate which may escape the precipitators or fabric filters which are the primary particulate collectors.

The biggest question facing the industry is whether there will be sufficient supplier capacity to fill the needs. The answer is that flexibility will be needed but the market demands can be met. If there is not enough nickel alloy steel, then the industry will have to use tiles and concrete, FRP, resin or rubber linings. If there are not enough ball mills to grind limestone, then the industry will have to use lime. If the U.S. suppliers cannot fill the domestic demand there are always the Japanese suppliers ready and able.

The main impact of the high demand is sharply rising prices of installed systems. The average FGD system is presently selling for 30 per cent more than it did in 2000.

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