China, India, the United States and Germany are looking to replace old coal-fired energy plants, helping make up for slack overall global demand, Hitachi Power Europe's business development manager said.
The economic downturn and initiatives to cut carbon emissions by moving away from high-polluting coal is curbing appetite for new plant construction, Hitachi's Graham Fagence told Reuters on Tuesday at a coal industry conference.
It's a feast and famine business a little, so after the last very good years we are now seeing a slowdown, Fagence said on Tuesday. China and India are still steaming ahead with new projects, and the U.S. and Germany are also building a lot.
Hitachi Power Europe, which designs and constructs coal-fired plants, is a unit of Japan's Hitachi Ltd (6501.T).
In Europe, Germany, one of the biggest users of coal-fired energy plants, is actively replacing heavily polluting and outdated facilities with ones burning coal more cleanly, equipment makers said.
The same is true in the United States but in India and China -- where environment regulations are less restrictive -- coal is simply the cheapest and easiest way to produce power for their expanding economies.
The new plants, thanks to newer technologies and higher efficiency, are less polluting than the units they replace.
It is simply most convenient for them to build coal plants, Fagence said.
The new units are much more efficient, so the carbon-dioxide emissions are significantly lower. They basically use less coal to produce the same amount of energy, Fagence added.
Many central and eastern European countries, which also rely heavily on coal to produce power, need to do the same but are struggling to find ways to fund new plant construction.
There are signs in places like Poland that demand in the energy sector may soon pick up, said Damian Goral from US engineering firm Foster Wheeler.
We are making boilers for both energy and other industries and actually, while in some sectors we witness delays, interest from the utilities remains high, Goral said.
Polish utilities are seeking to adapt their power generation units to burn not only coal but also biomass to help them towards meeting EU environment guidelines and cut carbon dioxide emissions.
Foster Wheeler supplied a boiler to a new 460 megawatt power plant in Lagisza, opened earlier this year, which allows burning of both coal and biomass.
We are working on a number of projects at the moment, but none of them is as big as the Lagisza plant, Goral said. (Reporting by Patryk Wasilewski, Editing by Michael Kahn and Anthony Barker)