Global Markets for Natural Gas-Fired Electricity Generation--Focus on South and Central America

Report Highlights

• The global market for natural gas–fired electricity generation is expected to reach nearly $34.0 billion in 2012, and is forecast to grow to $41.2 billion by 2017 at a compound annual growth rate (CAGR) of 3.9%.
• Within South and Central America, the total market will be nearly $980 million in 2012 and is expected to grow to $1.2 billion by 2017, a CAGR of 4.1% for 2012 to 2017.
• Consumption of natural gas for electricity generation in Brazil was 24.9 million tonnes in 2011 and is expected to expand to 25.3 million tonnes in 2012. Consumption should reach 31.1 million tonnes in 2017, a CAGR of 4.2% between 2012 and 2017.

INTRODUCTION

STUDY GOALS AND OBJECTIVES

This study provides a comprehensive analysis of the market for natural gas–fired electricity generation on a global basis.  Its aim is to provide a range of information, from detailed regional analyses to overall industry trends, in order to quantify and forecast markets for electricity generation.  Various types of electricity generation are forecast on a global basis.  Forecasts and trends are predicted based on a cross-reference of data points gleaned from government, industry, and other data sources to arrive at a cogent and coordinated forecast. 

REASONS FOR DOING THE STUDY

The global market for natural gas–fired electricity generation is large and growing at a relatively high rate.  The market is also extremely complicated in terms of technology, policies and regulations, and economics.  This report measures and analyzes different geographic and technology markets in order to help readers identify the regions and technologies where they can find the most promising opportunities.

The report also seeks to address changing market dynamics in the industry, emerging geographies, and types of technologies that are forecast to grow in each region.  This study also provides insight into the market structure in each region.  Such insight helps companies to identify global markets that are ripe for opportunity and those where entry or competition will be particularly difficult. 

SCOPE OF REPORT

This report presents an analysis of current and historical installed capacity of electricity generation in key regions in the world.  The analysis is organized by technology type, and data are presented for 2010, 2011, and 2012, with forecasts to 2017.

This report also presents forecasts for the size and growth of the electricity generation market in each country and region of the world.  The report includes an analysis of the major industry structure of each market by geography.  This analysis includes the levels of privatization versus public ownership of the electricity generation industry in a given market.  It also covers the ways in which the markets function and the level of competition present.  Relevant regulatory organizations, controls, and issues are also discussed.

Important government policies are presented as they relate to electricity generation and the industry in each country and region.  The projected effects of these policies on the forecasts for electricity generation in each country and region are discussed.  International agreements and regional cooperation are important to the electricity generating industries of many countries in the world, and these aspects are also discussed where they are relevant.

Industry trends in each technology market are presented.  The discussion of industry trends supplements the market forecasts by giving the reader of sense of what drives each forecast. The study also provides a competitive analysis of the major firms involved in electricity generation around the globe.  The firms that are analyzed include the major companies that are active in the major markets covered in the report.  These companies include independent power producers, electric utilities with generation businesses for their own consumption or for sale on the wholesale market, and integrated utility companies that have a strong presence in the electricity generation industry.

Market figures are based on total installed capital cost of generation and are projected at 2012 dollar value.  Inflation is not computed into the projection figures. 

INTENDED AUDIENCE

This report is an invaluable tool for business planners, acquisitions specialists, licensing strategists, product managers, market research analysts, investors, investor consultants, and anyone interested in the global electricity generation market, the industry’s structure, and industry participants across the globe.

The identification given in this report of overall market trends, product opportunities, emerging geographies, mergers and acquisitions (M&A) opportunities, and insights that provide guidance for sales growth or defensive moves is of utmost importance for a variety of constituents:

• Established companies in the industry will benefit from the contents of the report with regard to corporate strategy, sales and marketing, business development, and research and development (R&D).
• Emerging energy technology players in the industry must understand specific market dynamics in the nations and regions that are presented in the report.  They must also understand trends and how they relate to the future of global electricity generation.
• Investment firms evaluating candidates for venture capital or hedged investments will gain insights into the opportunities and risks that are being encountered in different industries across the globe.  This report will enable them to have an understanding of opportunities for investments in the global energy-generation sector.
• Equity analysts are provided detailed forecasts for the next five years, substantiated by quantitative analysis that can support further product and regional forecasts over the short and long run.

METHODOLOGY AND INFORMATION SOURCES

Both primary and secondary research methodologies were used in preparing this study.  An analysis of global electricity industry generation statistics was conducted in order to create the forecasts presented here.  Forecasts of generation capacity in each country and region were acquired from a number of sources.  The primary sources for this data were the U.S. Energy Information Administration’s (EIA) International Energy Outlook 2011 and the BP Statistical Review of World Energy June 2011.  This data was supplemented and updated with data found in press releases, news articles, industry association analyses, and data published by specific companies analyzed in this report.

The primary source of capital and operating cost data for the market forecasts was the EIA’s “Updated Capital Cost Estimates for Electricity Generating Plants,” published in November 2011.  These data were supplemented with analyst estimates based on experience in the electricity generating industries.

Forecasts of market size in each year were made by multiplying the amount of generating capacity expected to be installed in a particular market in a particular year by the capital cost per unit of that technology.  This provides a general high-level estimate of market size by technology and by country or region.  The additional assumptions that go into the capital cost estimates for each technology are explained further in the Technologies chapter of this report.

The primary sources of data on each company analyzed and profiled include articles published by industry analysts as well as data available on company websites and in annual reports.

Approximate conversion factors for various metrics are shown below:

Units:

1 metric tonne = 2204.62lb.

1 kilolitre = 6.2898 barrels

1 kilolitre = 1 cubic meter

1 kilocalorie (kcal) = 4.187 kilojoule (kJ) = 3.968 British thermal units (Btu)

1 kilojoule (kJ) = 0.239 kcal = 0.948 Btu

1 Btu = 0.252 kcal = 1.055 kJ

1 kilowatt-hour (kWh) = 860 kcal = 3600 kJ = 3412 Btu

Tonnes are used for market consumption data.  Tonnes are defined as the metric equivalent of tons. 

ANALYST CREDENTIALS

Stephanie Denarie earned a bachelor’s degree in environmental studies from Brown University and has completed coursework in corporate finance at the University of California at Berkeley and San Francisco State University.

Ms. Denarie has intensive experience in energy transmission modeling and financial management, and has consulted for groups as diverse as Optimum Energy, LLC, the states of Utah and California, the National Renewable Energy Laboratory (NREL), and Black & Veatch Corp..  Stephanie has developed several economic models and software tools to forecast price and economic competitiveness for energy projects, most especially for local renewable energy resources in diverse renewable energy markets. 

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DISCLAIMER

The information developed in this report is intended to be as reliable as possible at the time of publication and of a professional nature.  This information does not constitute managerial, legal or accounting advice, nor should it serve as a corporate policy guide, laboratory manual or an endorsement of any product, as much of the information is of a speculative in nature.  The author assumes no responsibility for any loss or damage that might result from reliance on the reported information or from its use.