BY THE NUMBERS: Axford Turbine Consultants – Combined Cycle Journal

BY THE NUMBERS: Axford Turbine Consultants

‘And you thought the housing market was lousy’

Those were the first words Mark Axford spoke at his annual January sit-down with the editors to review the US and global markets for gas and steam turbines. The founder of Houston-based Axford Turbine Consultants, respected for his solid industry data, provided year-end extrapolations for 2010 based on actual numbers for the first nine months.
Axford’s valued current-year projections and market insights are the focus of his annual report to the WTUI membership, which begins at 8 a.m. Tuesday in the Catalina/Madera/Pasadena rooms. Final 2010 numbers also will be available at that time.
“The recession that has been felt throughout the US has been especially hard on the power generation business,” Axford said. Domestic orders for both gas and steam turbines fell again during 2010 (Figs 1, 2).
The fundamental problem, he added, was that industrial demand for electricity continued to stagnate in 2010 because the recession forced factories to operate at relatively low capacity factors.
While cumulative kilowatt-hour consumption in the US was up 4.2% in 2010 versus 2009, most of that gain was attributable to a very hot summer (Fig 3). Air conditioning load was significantly higher than average. Even with the significant bump in kilowatt-hour sales last year, consumption was still below the figure for 2007.
Assuming “normal” summer weather for 2011, DOE predicts electricity consumption will be lower in 2011 than it was in 2010. This would mean three down years in the last four for the first time in the nation’s history.
Globally, Axford said, 2010 orders for gas turbines essentially were flat, while those for steam turbines were off by about 25%. Geographically, he continued, gas turbine orders were spread relatively uniformly around the world. But steam turbine orders were concentrated in Asia because both India and China are adding considerable coal-fired capacity.
Axford believes that “until we see a steady increase in the demand for electricity of 1% to 2% annually, and a return to ordering of new generating capacity based on the actual cost of electricity production [no subsidies], construction of simple- and combined-cycle power stations will remain subdued.”

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