U.S. power industry sees growth despite lean times

subscribe

Despite the global economic downturn, the U.S. Power Industry is managing to see continued growth driven primarily by the development of renewable energy resources and new natural-gas-fired generation.

At present, there are 341 new generating units representing more than 45,000 megawatts (MW) of capacity under construction in the country. In addition, 300 units totaling 23,000 MW are scheduled to begin construction in the nation during the last half of 2009.

Much of this capital project spending activity is being driven by the construction of new renewable energy sources, led by wind, biomass and solar. In fact, Industrial Info Resources has identified 14,000 MW of renewable energy currently under construction in the country and an additional 9,900 MW earmarked for construction kickoff before the end of the year.

Assuming all of this planned capacity moves to fruition, it will represent an investment of more than $20 billion. This drive to build renewable energy sources is being driven by a number of factors, including incentives such as a three-year extension of the Renewable Energy Tax Credit, Investment Tax Credits and the passage of renewable energy portfolio standards by 28 states. Of course, this segment of the industry is facing a number of hurdles, as well, including financing issues, permitting obstacles and transmission constraints, to name a few.

In addition to construction activity to build new renewable energy sources, the industry is experiencing an upswing in activity to build new natural-gas-fired generation units.

Currently, 22,000 MW of simple-cycle and combined-cycle natural-gas-fired capacity is under construction. Furthermore, there are more than 100 units and 11,000 MW of new natural-gas-fired capacity under development and planned for construction kickoff before the end of the year.

Assuming this additional activity moves forward to a construction phase, it will represent a total investment of more than $7 billion. Much of this new capacity is being built to meet demand that was originally planned as coal-fired capacity and scheduled for completion after 2010. Other natural-gas-fired units are being built to supply peaking capacity and for grid support across the country.

Higher construction costs and uncertainty over looming carbon-dioxide legislation have derailed the development of new coal-fired projects. Yet still, there are 33 new coal-fired units under construction, representing 16,000 MW and more than $28 billion in the United States, that are expected to proceed to completion.

There are an additional six units and 1,900 MW of new coal-fired capacity scheduled for construction starts in 2009, but it is expected that these will be delayed for a few years. Beyond 2009, 27,000 MW of coal-fired capacity is under development in the United States.

While the industry has experienced a downturn in activity when compared to recent years, spending in the Power Industry is expected to remain healthy. Even though demand has been down for the past several months, projections indicate the need to develop 15,000-20,000 MW per year to meet demand and to replace older units scheduled for retirement.

Related News

ontario-ev-jobs-boom

Ontario's EV Jobs Boom

ONTARIO - The electric vehicle (EV) revolution is gaining momentum in Canada, with Honda Canada announcing a historic $15 billion investment to establish the country's first comprehensive EV supply chain in Ontario. This ambitious project promises to create thousands of new jobs, solidify Canada's position in the EV market, and significantly reduce greenhouse gas emissions.

Honda's Electrifying Vision

The centerpiece of this initiative is a brand-new, world-class electric vehicle assembly plant in Alliston, Ontario. This will be Honda's first dedicated EV assembly plant globally, marking a significant shift towards a more sustainable future. Additionally, a standalone battery manufacturing plant will…

READ MORE
ontario hydro

Ontario will not renew electricity deal with Quebec

READ MORE

Ontario to Provide New and Expanded Energy-Efficiency Programs

READ MORE

carbon capture

Carbon capture: How can we remove CO2 from the atmosphere?

READ MORE

clary power lines

Electricity alert ends after Alberta forced to rely on reserves to run grid

READ MORE