Gas Turbine Energy Market Study: Insights from Power Gen International 2017
We visited Power Gen International in 2017 to not only discuss K&A’s digital marketing & market research consulting services but also to conduct an energy industry market study for a client who was an HRSG supplier used in Combined Cycle gas fired turbines. The objective was to understand the market for aftermarket HRSG services in North America. Power-Gen was the ideal venue for such a Gas Turbine power market technology analysis because we arranged interviews and focus groups with nearly 25 Combined Cycle unit plant managers, performance engineers, and fleet operators. The data provided us with vital qualitative market analysis, which we blended with our energy market forecasts to compile a CCGT & HRSG market study that was very well received. The client has since returned in 2024 to assess the impact of green hydrogen and other energy transition technologies and the long-term viability of Gas Turbines from a North American perspective.
For more information on a recent worldwide market study on thermal fuel opportunities please visit www.krishnaninc.com/analytics/energy-market-forecast-for-coal-gas-thermal where we cover coal, gas, biomass and waste-to-energy technologies
Transcript from an Interview of a Plant Manager at Power Gen 2017 for our Gas Turbine Power Market Study
How long do you think you will run your HRSGs? It varies, we have 25 HRSG units in service varying in age and operation. As a rule of thumb you expect 20 years. Much of it has to do with how the unit operates. We currently have (3) Hamon units that have had major areas of concern that are within the first 5 years of service.We have some units that we have been told will run 30 years. We have GE equipment that is assessed regularly with the goal of increasing the life-cycle. After each outage we complete an LTA (Long Term Assessment) report helping them form the budget. We work very closely with HRST to do regular inspections as well as the OEM. The goal is to improve availability.
What is their plan when your HRSGs reach their age? Typically, we do the major repairs to keep the unit online. First we do all that we can from a PM stand point and as replacements are needed, they will be assessed when the time comes. We will do what’s needed to extend life.
What has been the HRSG maintenance budget recently and is it expected to change? Maintenance budget is a 3 year budget that gets revisited annually and it is always subject to change as projects are reprioritized. As for the budget amount, it is different for each plant.
Who typically performs minor HRSG repairs? (e.g., minor valve replacement, tube repair, liner panel washer repair, etc.). Is this work performed by plant personnel, a local contractor, or the OEM? All work is contracted out, usually to the OEM.
What OEM’s are you working with? Alstom, GE, Nooter/Eriksen, Hamon… and again we rely quite a bit on HRST for evaluation.
Are major refurbishments or upgrades being planned over the next few years? Yes, there are and I am not at liberty to discuss those.
Are there any pressure part related projects? Yes, bellows, finned tube replacement, expansion joints.
Can I ask what you plan on spending on pressure parts in 2016? Pressure parts are probably the highest cost to maintain and capital expenditures aside from the turbine. We replace and repair pressure parts in every outage, some capital projects and are paid for with the plant maintenance budget.
As a company, how much money is spent on pressure parts annually whether paid for with maintenance money or capital? If I were to guess, fleet-wide we spend close to $12M / year on pressure parts. Is that number growing? Yes that number has increased and we expect it to increase as units age.
Any planned replacements related to a specific HRSG OEM design issue? Yes, I think we covered this, we have had some performance issues with Hamon units that we are working through.
What are key criteria in determining repair projects? Yes, Cost and Performance are key criteria. Again, availability is a high priority. We have a very good relationship with HRST and refer to them.
Are there unmet needs regarding HRSG services? No, I think we are very happy with our service suppliers both OEM and HRST.
Do you see a benefit in sourcing services and parts from a single supplier? No, I like dealing with the machine manufacturer. I believe that is HRST’s preference as well.
What do you expect from the OEM? To be responsive, be quick to take care of any issues that come up, complete projects on time and to be fair with pricing.
Any recent changes in your thinking about HRSG maintenance? We have made some changes. We have increased unit inspections and PM maintenance budgets have also increased. We are inspecting components we never paid close attention to in the past. We have gotten more thorough.
Why have you made these changes? The market has changed and there have been major changes in the way we operate most of our units. Some units are now cycling more and some units that were cycling are now running baseload, it is challenging.
Do you see any technology gaps? Any things you would like to be able to do that are presently not available? e.g. related to repairs, inspections, replacements? None that I can think of right now.
When do you believe will be your next major HRSG expenditure and when? 2017. We manage 10 -12 cap projects a year, some are smaller and some are in the $1-2M range.
What is the estimated size of the expenditure in 2017? Probably close to $3M.
What is the scope of the project? Pressure parts, I don’t have time to get into project scopes.
Can I ask one last question and I will leave you alone? Sure
What services and parts would make sense to include into a HRSG service package? I would say inspections for every planned outage, life assessment of pressure parts specifically tube modules, headers and manifolds.