The global economic slowdown cautioned power project developers against making huge investments in turbines, especially due to the lack of financing options. Therefore, power generation expansion programs took a backseat in 2009.
However, all this is changing with the economy on the mend and rising environmental consciousness triggering legislation. Governments in Australia and New Zealand have been actively promoting emission reduction and the use of greener technologies.
New analysis from Frost & Sullivan (energy.frost.com), ANZ Gas Turbines Market, finds that the market earned revenues of $249.0 million in 2009 and is expected to earn approximately $2,610.0 million from 2010 to 2016.
Highly efficient gas turbines, complemented with emissions reduction technologies, are alternatives to the environmentally hazardous coal power plants.
Interestingly, the market is also expected to acquire business from the several proposed coal-fired power plants in Australia, as they are expected to use integrated gasification combined cycle (IGCC), coal gasification and storage (CCS), or a combination of the two technologies. This will ensure steady demand for combined cycle gas turbine (CCGT) and open cycle gas turbines (OCGT), most often used for peaking power and wind balancing.
"Moreover, the drive toward energy efficiency ensures the usage of the latest, more expensive technologies for new build projects, thus boosting the total market revenues," says Frost & Sullivan Program Manager Irina Sidneva.
Considering Australia and New Zealand are two of the most advanced power markets in the Asia Pacific, technology providers should offer the latest, most efficient technologies, and lowest emissions output solutions to compete for new projects in these countries.
Moreover, with service becoming a vital component in the power solution package, potential suppliers have to provide enough flexibility to answer end users' needs - be it a turnkey contract for power plant construction or a full power plant availability service contract. To achieve this level of competence, original equipment manufacturers (OEMs) should have adequate coverage of the region, both in terms of engineers' availability and spare parts delivery.
The future of the gas turbines markets in the ANZ region seems promising in the next five years, with new contracts predominately expected from Australia. On the other hand, the New Zealand market will feel the pinch of the non-availability of gas resources and gas infrastructure in Pacific Islands, low grid electricity prices applied to industrial end-users, and volatility of gas prices.
While peaking gas-fired stations can be installed along with large wind power projects, the rising demand for the rest of technologies will hinder the gas turbines market. The business from the oil and gas segment is expected to remain constant as a few planned oil and gas and liquefied natural gas (LNG) projects will be set in motion soon.
"Overall, the growth potential for the utilities and industrial power segment will depend on the level of adoption of the other power generation sources including coal, renewables, hydro, and geothermal," notes Sidneva.
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ANZ Gas Turbines Market / P37E