Largest Revenue Generation in the World FGD Market Will Be in the Aftermarket
The market for flue gas desulfurization (FGD) systems, components and services will grow over the next eight years despite the environmental initiatives to reduce coal-fired power generation. This is the latest forecast in N027 FGD Market and Strategies.
The Trump Administration will not be able to reverse the movement away from coal in the U.S. The main reason will be the continued low cost of natural gas. However, Asia will continue to build coal-fired power plants. As a result, by 2025 Asia will have a coal-fired power capacity three times larger than that of Europe and the U.S. at their peaks.
In 2008, the U.S. was winding up a big FGD retrofit program and China was in the middle of a combined FGD retrofit and new coal-fired power plant expansion. Thus, the market for new systems was over $10 billion.
Due to the abrasive and corrosive slurries, high temperatures and sheer size of the FGD systems and components, the market for replacement parts, repair and service is substantial Since most coal-fired power plants around the world cannot continue to operate when SO2 levels exceed requirements, there is a big investment in operation and maintenance.
Smart valves, pumps and fans are increasingly combined with software programs to provide remote operation of plants. As a result, a big market is developing for third parties to support the operations or even take over the operations of the systems. The first such example was in the 1990s when an Indiana power plant contracted with Mitsubishi and Air Products & Chemicals for a BOO system.
The opportunity to offer BOO systems and generate revenues from byproduct sales will be expanding. In the past, suppliers have offered to supply BOO systems and to generate revenues from the supply of ammonium sulfate. Byproduct gypsum is only a fraction of the value of ammonium sulfate. The biggest opportunity is the potential extraction of rare earths. A two-stage scrubbing system is likely to provide the lowest cost process to extract rare earths from flyash and at the same time generate hydrochloric and sulfuric acid.
Source: The McIlvaine Company