The market for flue gas desulfurization systems (FGD) will exceed $6 bill. per year over the next decade, according to a report by McIlvaine Company. However, whether it is just $7 bil. or as much as $10 bil. depends on regulatory initiatives, which are not yet solidified.
Flue gas desulfurization systems remove SO2 from the stack gases of coal-fired power plants. The market is split between older plants that must retrofit FGD and new plants that must include FGD. Presently, McIlvaine says less than half the world”s FGD capacity at power plants is fitted with FGD systems, so the retrofit market is quite large. In addition, many FGD systems in Europe, Japan and the United States are more than 20 years old and must be replaced.
Very few new coal-fired power plants will be built without FGD, according to McIlvaine. In fact, McIlvaine says even some of the least-developed Asian countries are installing FGD systems along with their new coal-fired boilers. The potential SO2 emissions from coal-fired power plants far exceed emissions from other sources combined. SO2, through acid rain, causes damage to trees and buildings. Recently, it has been learned that the SO2 reacts with ammonia and calcium in the atmosphere to form very fine particulate.
McIlvaine says this fine particulate is the air pollutant of greatest concern. The decisions by Germany and some other countries to abandon or de-emphasize nuclear power will have a positive effect on the construction of new coal-fired power plants. There are other potential positive impacts on the construction of new coal-fired power plants. The U.S. has an inventory of very old coal-fired power plants, which are subject to massive retrofits of systems to reduce pollutants, including air toxics. McIlvaine says new supercritical coal-fired power plants can be justified as replacements based on just a 25-year life.
The replacement of the U.S. fleet of old coal-fired power plants would substantially reduce CO2 and other pollutants due to greater efficiency, according to McIlvaine. These plants offer the lowest cost energy generation option. McIlvaine believes the $600 billion capital stimulus would be very beneficial to the U.S. economy, as their retirement 25 years after construction would eliminate the main reason new plants are opposed by environmental groups. Each of these plants would have an FGD system.