Industrial & Marine Turbine - Gas & Steam Turbines: The Market for Gas Turbine Electrical Power Generation

A review of the factors that drive the effectiveness of gas turbines as industrial workhorses will help explain why they remain the logical choice for a majority of new power plant projects, and will continue to do so for many years to come.

One of the benefits of gas turbine machines is their modularity and extreme flexibility. Schools, civic centers, and shopping malls are good applications for 200-kilowatt units; entire cities can be powered by 200megawatt units. Heat recovery units add the ability to cooperate with industry and provide steam for power or processes, or even supply a municipality with district heating/cooling. This also highlights the fact that in combined cycle and CHP applications, efficiencies up to nearly 60 percent are realized. Simple-cycle machines with ICR (intercooled recuperated) systems can see up to 35 percent efficiency.

Gas turbines, increasingly in combined-cycle applications with heat recovery steam generators (HRSGs) converting waste heat into steam, and steam turbine generators (STGs) using that steam for increased generation efficiency, will continue to be the workhorses in the power generation industry. While gas turbines accounted for 15 percent of the power generation industry in 1998, according to the U.S. Department of Energy they are expected to account for 40 percent of U.S. generation by 2021. In evaluating the market for gas turbine electrical power generation over the next decade, many factors lead to the conclusion that annual growth will most likely exceed 2.5-3.0 percent worldwide in order to keep up with demand.

With combined-cycle installations touching the 60-percent mark for net plant efficiency ratings, we do not believe that gas turbine machines will continue to get significantly larger in terms of power output. A gas turbine machine having a firing temperature of about 2,400°F (1,316°C) has about a 56 percent net plant efficiency level in combined-cycle configurations; at about 2,500°F (1,371°C), a 57.2-57.3 percent net plant efficiency; and at about 2,600°F (1,427°C), close to a 60-percent net plant efficiency. Any technological advances above the 60 percent level will be small and incremental, and will take more time to be introduced - but they will be introduced. What is left to accomplish with the gas turbine machine itself falls into the areas of improved combustion, more exotic heat-resistant alloys, improved metallic- or ceramic-based blade and vane coatings, more sophisticated cooling schemes, improved steam water injection techniques, and increased use of fuel preheating. It should be noted here, however, that some advances can take their toll on the gas turbine machines, actually placing them under greater stress.

Gas turbines can often be incorporated into renewable energy projects. When the topic of renewable energy is raised, the first items that come to mind are rows of towering wind turbines or large solar plants. Gas turbines are too often tied to images of fossil fuels: oil- and gas-powered plants, cleaner and more efficient than their coal-burning predecessors, but still dependent on a limited fuel supply. One does not have to believe that planet Earth is on the brink of a "post-peak oil" catastrophe to realize that there are advantages to having a balanced energy profile that includes a share of renewable fuels in the mix.

Gas turbines lend themselves to this end in two ways, directly and indirectly. In a direct manner, any number of fuels derived from renewable sources can be provided to a combustion turbine in a combined-cycle arrangement to derive the cleanest and most efficient use of that fuel. Indirectly, more conventional gas turbines with fossil fuel applications can be paired with the wind or solar plants to give a more reliable and dispatchable service profile as required by the market until storage and smart grid technologies catch up with generating capability.

No solitary source will meet all of the world's power requirements, but gas turbines are increasingly being adapted to many schemes to improve the efficiency and reliability of power projects. Renewable fuels show promise, as do synthetic fuels from coal and biomass; careful consideration of the energy demand for energy investment is required. It makes no sense to process materials through so many steps that the cost to make them is greater than any value derived from them. With the energy demand projected in the next decade, there will be room for unprecedented development in all sectors and regions.

When the need becomes critical, new electrical power generation capacity can come from several sources: fossil-fuel-burning machines such as gas turbines (including microturbine machines of under 250 kW) and the new wave of gas engines and diesels; hydroelectric, nuclear, solar, and wind power; waste-to-energy plants (which burn paper/wood, scrap, food waste, and bagasse); and exotic alternatives such as geothermal energy, ocean currents, and fuel cells.

A source of electrical power that many dismiss for initially appearing to be fiscally unproductive is conservation. Though it may slow the demand for new machine installations, there is a positive side to concerted conservation efforts in established markets. First, showing concern for overall efficiency, and not simply immediate profit, helps build credibility with the customer. While many original equipment manufacturers (OEMs) are entering into long-term operations and maintenance contracts, they must be realizing that steady, baseloaded machines and unencumbered transmission and distribution lines are favorable in terms of maintenance costs and overall financial performance.

Fuel cells are still considered to be in the demonstration stage despite their immense appeal stemming from their "relocation" of harmful emissions, but we believe they will be abundant from about 2014. Wind power, while commercially available, is not available everywhere; its overall efficiency is about 50 percent, and it is expensive in the near term on a dollar-per-kilowatt-hour basis. Nuclear power and hydroelectric plants are very expensive and require a long period of hearings, followed by attempts to obtain financing and approvals, and finally, construction. Solar power is very appealing, but shares the drawbacks of wind power - it is not available everywhere, electrical power storage technology is immature and cannot handle the capacity, and it, too, is expensive on a dollarper-kilowatt-hour basis.

The viable alternatives are few. Above the level of microturbines, whose efficiencies range from 2028-percent, are what we consider to be true gas turbine machines that range in power output from 200250 kW at the low end to the super-highpower machines of 350+ MW. Today, gas turbine machines have simplecycle efficiencies of at least 35 percent, with some approaching 45 percent, while some are advertised as already having a 60 percent efficiency in combinedcycle mode.

What does past performance predict? While gas turbine machines continued to be ordered and fabricated for electrical generation for their usual end uses (continuous duty, standby duty, and peaking duty), the lower powered gas turbine machines, those up to 3.5-4 MW, have traditionally been employed in standby duty. As we move up the power spectrum, the normal-use shift toward continuous duty becomes more noticeable at the power level of 20-30 MW. At 120125 MW and larger, virtually all gas turbine machines have been/should be ordered for use in continuous generation duty.

Given the current need for new baseload capacity, as well as for power plant capacity additions, Forecast International believes that the worldwide demand for the latest technology gas turbine-based power plants will result in modest production of the super-large gas turbine machines, those of 180 MW and larger. Those machines can be expected to be procured by China, North Korea, Vietnam, Indonesia, Thailand, Brazil, and the Middle East.

Without endangering the food supply, a large number of agricultural products and by-products can be adapted as renewable fuels in gas turbines. Sawdust and sawmill waste can be fermented and distilled into cellulosic ethanol; corn cobs and bagasse (from sugar cane) may be converted to gases or oils through pyrolysis and Fischer-Tropsch Synthesis (F-T). Methane is being derived from manure on large-scale farms and powering gas turbines in all corners of the world.

One of the most promising technologies on the renewable energy front is the F-T process. In South Africa, Sasol has been providing fuel for the majority of the country's vehicles for over 50 years, using lowgrade coal as the carbon source. It is possible to use any renewable carbon source such as agricultural waste to fuel the process. One disadvantage is a slightly lower energy return on energy investment, causing, depending on the fuel source, an increase in cost of up to 10-percent. F-T fuels do have some advantages that help offset the increase in cost. First, there is no modification of engines required, such as the compression profile changes that may be required with ethanol and cleaner environmental properties due to low sulfur and particulate. And second, F-T fuels have a higher cetane number, leading to lower nitrogen oxide emissions.

Thus once again, the flexibility and efficiency of gas turbines provide a steady workhorse to the industry, even as the world moves toward a renewable energy profile standard.

The fastest growing source of primary energy is projected to be natural gas. Consumption of natural gas is projected to soon surpass coal use (on a Btu basis), and grow increasingly faster through 2025. Much of the growth is driven by demand for natural gas as the fuel for new gas turbine power plants due to its environmental and economic advantages, as well as the expectation that the young gas markets of emerging nations will develop rapidly in the near future. World coal use will account for a gradually decreasing share of world energy consumption, even though its use in tons is projected to grow at a rate of 1.5-1.7 percent per year through 2025. New supplies of natural gas will come largely from the Caspian Sea region, Russia's Far East region (including Sakhalin Island), and Central/South America.

World oil consumption is projected to increase 1.71.9-percent annually in the years ahead - from the 77-million barrels per day (mmb/d) consumed in 2003 to 85 mmb/d in 2005 and 2006, and to a Forecast International-projected 110 mmb/d in 2021.

From today's levels, energy demand is expected to more than double by 2021, especially in Asia, with China being the most avid consumer of oil, gas, and coal. Other leading users are/will be India, Mongolia, and Vietnam. Brazil leads energy development in Latin America, and stands to set the example for some years to come.

Format and Methodology

The gas turbine-powered electrical generation market analysis is based on a review of gas turbine machines either currently in production or projected to be in production by the end of 2021. The programs were reviewed with consideration to such factors as order patterns, population growth projections, financing, environmental concerns, fuel concerns, and geopolitics.

Forecast International has divided the gas turbine-powered electrical generation market into two segments based on the power output of the gas turbine machines. The "Heavy" (or large) machines are those having a power output of 15,000 shp (11,185 kW) or more, while the "Light" (or small) machines have a power output of up to 15,000 shp. Although about 60 programs were reviewed in the preparation of this market overview, not every turbine machine program had a unit production in each year of the 2012-2021 timeframe.

A few manufacturers such as Rolls-Royce, Solar, and General Electric Co (USA) produce pure gas generators as part of their product line, with those machines shipped to packagers (such as Dresser-Rand and Centrax) for the addition of equipment prior to shipment to customers. For all other gas turbine manufacturers, the production forecast is for complete machines. Identified below are the gas turbine machines that were either in production in 2012 or projected to be in production by the end of 2021. The listing is intended to provide a cross-reference to the reports in the Industrial & Marine Turbine Forecast, Tabs A and B.

While licensees are listed independently in the two-part listing that follows, they are included in the reports of the major OEMs' programs.

Despite the near-production-ready status of the machines, no forecast or full-length program report is included for the GE LM500 or for the recently announced Siemens AG SGT5-8000H.

Not included in the production data in this analysis are "Heavy" gas turbine machines for electrical generation produced by GTRPC Zorya-Mashproekt, Motor Sich JSC, or Power Machines Group.

It should be noted that virtually all of the electrical generation machines in the "Manufacturer Varies" category will be produced by the identified manufacturers. As such, the unit production and value of production totals for the identified major OEMs may actually be slightly higher than the totals herein.

Heavy Gas Turbines (11,185 kW and Larger)

Forecast International has issued forecasts for the following "Heavy" gas turbine machines:

Alstom GT24
Alstom GT26
Alstom Type 8
Alstom Type 11
Alstom Type 13
Bharat Heavy Electricals Model 5000*
Bharat Heavy Electricals SGT-2000E*
Ebara FT8*
GE GE-10/1
GE LM1600
GE LM2500/LM2500+
GE LM6000
GE LMS100
GE Model 5000 (Frame 5)
GE Model 6000 (Frame 6)
GE Model 7000 (Frame 7)
GE Model 9000 (Frame 9)
Hitachi H-25
Interturbo (ZAO Interturbo) SGT5-2000E*
Kawasaki L20A
MAN Group FT8*
Mitsubishi MF-111
Mitsubishi Model 501 Series
Mitsubishi Model 701 Series
Rolls-Royce Industrial RB211
Rolls-Royce Industrial Spey
Rolls-Royce Industrial Trent
Siemens SGT-400
Siemens SGT-500
Siemens SGT-600/700
Siemens SGT-800
Siemens SGT5-2000E/3000E/4000F
Siemens Westinghouse SGT6-3000E/5000F/6000G
Solar Titan 130
UTC PWPS FT8

*Licensees and/or coproducers
Light Gas Turbines (Up to 11,185 kW)
Forecast International has issued forecasts for the following "Light" gas turbine machines:
Daihatsu DT Series
Dresser-Rand KG2
GE GE-5/1
Kawasaki M1A/M1T Series
Kawasaki M7A
Kawasaki S1/S2 Series
MAN TURBO THM 1200/1300
Mitsui SB5
OPRA Optimal Radial Turbine OP16
Rolls-Royce 501-K
Siemens SGT-100 (Typhoon)
Siemens SGT-200 (Tornado)
Siemens SGT-300 (Tempest)
Solar Centaur
Solar Mars
Solar Saturn
Solar Taurus
Turbomeca Makila TI
PWPS ST6
PWPS ST18
PWPS ST40
Vericor ASE8
Vericor ASE40
Vericor ASE50

Not included in the production data in this analysis are gas turbine machines for electrical generation produced by GTRPC Zorya-Mashproekt, Motor Sich JSC, or Power Machines Group.

Light Machines in Early Stages of Development or Production. Despite the near-production-ready status of the machines, no forecasts or full-length program reports are included at this time for the DresserRand-KG3, Ishikawajima-Harima IM270, OPRA Radial Turbine OD5, or Solar Mercury 50.

GE Licensees/Affiliated Firms. In addition to the major gas turbine manufacturers in Forecast International's consolidated database, Forecast International includes the generic category, "GE-Licensees/Affiliated Firms." It should be noted that virtually all of the machines in this category will be produced by other, already identified manufacturers. As such, the unit production and value of unit production totals for some of the already identified major participants are actually higher than their totals indicate.

Data. All data used in this analysis were run from the Forecast International marketing database in July 2012. Because Forecast International updates many reports on a daily basis, projections and trends (as well as the status of many programs) can change noticeably as program activity changes.

Cost/Value of Production. Because of the manner in which cost/value of production of machines and engines is listed - i.e., gas generators, gas turbine machines unmounted, gas turbine machines included in a basic gas turbine generator package - users of the data may wish to apply their own costs/values of production.Data pertaining to the cost/value of production of the gas turbine machines and engines covered herein have been rounded. All value data are estimated in millions of U.S. calendar-year 2012 dollars.

Typical Gas Turbine Systems Compared. The output parameters of typical gas turbine systems are as follows:

SYSTEM MODE
OUTPUT vs. WASTE

Simple-Cycle
35-40% Electrical Output/60-65% Waste

Combined-Cycle
45-60% Electrical Output/40-55% Waste

Simple-Cycle Cogeneration
35-40% Electrical Output/55-60% Thermal Output/5% Waste

Combined-Cycle Cogeneration
50-65% Electrical Output/30-45% Thermal Output/5% Waste