Forecast sees strong growth in coal, gas, hydro generation
Ann Chambers, Associate Editor
Coal continues to be the most widely used energy source in the world, and one-third of all investments in power generation will go to coal-fired plants in the next 15 years, according to “Financing Worldwide Electric Power: Can Capital Markets Do the Job?” from the US Department of Energy (DOE). Investments in gas-fired capacity are also expected to be large in most parts of the world. China and Latin America are expected to add considerably to their hydroelectric capacity .
Coal is projected to be the most widely used energy source and to receive the largest investment in every region but Latin America. Asia will lead the world in new coal generation. Currently, 34 percent of the world power capacity is coal-fired, generating 39 percent of total electricity. Older coal-fired plants will be upgraded to improve efficiency and reliability and to reduce emissions, especially in North America, Eastern and Western Europe, the New Independent States (NIS) and China. The worldwide market for retrofits and repowering of existing coal-fired power plants is estimated at (US)$128 million over the next 15 years. Some solid fuel capacity in North and Latin America is also predicted.
Gas-fired capacity is projected to grow faster than any other type of generation and is increasingly being used for baseload purposes. Twenty-one percent, or an estimated (US)$298 billion, of the total investment in new capacity will be for gas-fired plants, according to the DOE projections. Capacity factors for gas-fired power plants are increasing in most parts of the world and are expected to keep increasing. This reflects anticipated construction and use of combined-cycle combustion turbines. All regions except China, which has only small gas reserves, are expected to add substantial gas-fired capacity. Lower capital costs, shorter lead times, low gas prices and environmental concerns are stimulating investment in gas-fired generation.
The total worldwide investment in new hydroelectric capacity is projected at (US)$235 billion. Strong growth is expected in China and Latin America, both of which have large, untapped hydroelectric resources. China is expected to increase its hydroelectric capacity by 74 GW, or 32 percent of total new capacity. In Latin America, hydroelectric plants generated nearly 75 percent of all power in 1992, and with a planned capacity increase of 58 GW between 1995 and 2010, it will continue as the most important power source in Latin America.
New nuclear power capacity is planned in the Pacific Rim, China, East Asia, South Asia and the NIS. These regions are planning 63 GW of new nuclear capacity and account for 85 percent of planned new nuclear capacity worldwide. Nuclear power plants are being constructed primarily in Japan, South Korea, China and Taiwan. Currently, about 81 percent of all nuclear power generation capacity is concentrated in developed countries. Developing countries, however, will install much of the new nuclear capacity in the next 15 years. Substantial investments will also be required to rehabilitate nuclear plants in transitional countries.
Very little new, oil-fired generating capacity is anticipated.