SUGAR LAND, TX — (Coal Geology) — 07/28/10 — Written by John Egan for Industrial Info Resources (Sugar Land, Texas) — Coal producers and coal-burning utilities are facing tough strategic questions on many fronts these days, ranging from environmental retrofits to new-build decisions and plant-life extensions. They can get some answers at Booth 706 at the upcoming Coal-Gen 20-Ten Conference & Exhibition, which runs August 10-12 at the David L. Lawrence Convention Center in Pittsburgh. Booth 706 is where members of the Industrial Info Resources team will be available to demonstrate database tools that identify business opportunities in the coal and power industries.
“Right now, many eyes are focused on Washington, D.C., where Congress and the U.S. Environmental Protection Agency (EPA) are considering new laws and regulations that will shape the future for coal companies and coal-burning utilities for decades to come,” said Britt Burt, Industrial Info’s vice president of research for the Power Industry. “Development of new coal-fired generation has been in a state of limbo because of proposed energy legislation and environmental regulation.
“But there are still about 12,000 megawatts of coal-fired power generation capacity under construction in the U.S. right now, and we are tracking an estimated $5 billion worth of Power Industry environmental retrofits that are scheduled to kick off this year,” Burt said in an exclusive “Navigating the Currents of Change” interview. Burt added that IIR is tracking an additional $10 billion in environmental retrofit spending opportunities in the Power Industry that are scheduled to kick off in 2011 and beyond. The IIR VP said he expects this number to go up “substantially” once there is greater clarity about the regulation of industrial emissions.
Legislative and regulatory efforts to place a price on carbon dioxide emissions are expected to significantly increase the cost of building a new coal-fired generator, Burt continued. “No one is willing to move forward with the development of new coal-fired capacity until there is greater clarity about the price of carbon. But CO2 limits are expected to hurt existing coal-fired power plants as well, because they’ll have to take measures to reduce CO2 emissions or close some facilities altogether.”
Coal mining companies also will be affected by efforts to place a price on carbon. Industrial Info is tracking about $13.8 billion of coal mining projects in North America, many of which were launched to replace the declining production at existing coal mines, added Joseph Govreau, Industrial Info’s vice president of research for the Metals & Minerals Industry. Some of the larger coal projects under construction in the U.S. today include:
The Lively Grove Underground Mine, built by Peabody Energy Corporation (NYSE:BTU) (St. Louis, Missouri), is a $1 billion underground coal mine with a targeted completion date of April 2011. The Bear Run Surface Mine, another Peabody project, is a $400 million surface mine project in Indiana that kicked off late last year and is scheduled to be completed in 2013.
“Since the coal mining industry tracks developments in the electric power industry, it’s been a little slow for new capital projects,” Govreau said. “I see project activity holding fairly steady for the next six months. Given recent economic conditions, including reduced demand for electricity, I’d say that $13.8 billion of coal mining projects is pretty substantial.”
Approximately 90% of all the coal mined in North America goes to power plants, Govreau said, adding that about 50% of U.S. electricity comes from coal. “Coal is our most important electric generation resource.”
Burt and Govreau encouraged engineering and construction firms and equipment and service suppliers with an interest in the coal or coal-fired power businesses to attend the upcoming Coal-Gen 20-Ten event in Pittsburgh. “This is an important event for the coal-mining and coal-burning electric power industries. Attendees can network with their colleagues, develop new contacts, and stay abreast of current legislative and technology developments,” Govreau said.
“We encourage our customers and potential customers to visit the IIR at Booth 706 to see our full line of tools that can identify business opportunities in the marketplace for all types of industrial equipment providers and service companies,” added Burt. “It’s an important opportunity to strengthen relationships, connect with people in the industry, help shorten sales cycles for industrial equipment and service, and stay current on industrial project spending opportunities.”
Industrial Info Resources (IIR) is the leading provider of global market intelligence specializing in the industrial process, heavy manufacturing and energy markets. IIR’s quality-assurance philosophy, the Living Forward Reporting Principle™, provides up-to-the-minute intelligence on what’s happening now, while constantly keeping track of future opportunities. For more information send inquiries to powergroup@industrialinfo.com or visit us online at www.industrialinfo.com.
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