The Growth of International Coal Markets and The Commercial Implications for the U.S. Coal Industry

Transcription

1 The Growth of International Coal Markets and The Commercial Implications for the U.S. Coal Industry International Pittsburgh Coal Conference September 28, 2006 Shannon L. Fraser U.S. Department of Commerce Office of Energy and Environmental Industries 1

2 DOC Economic Impact Analysis Office of Energy and Environmental Industries (OEEI) and Office of Competition and Economic Analysis (OCEA) U.S. Economic Impacts under EPACT 05 OEEI and OCEA economic analysis: Potential U.S. Exports of Clean Coal Technologies (CCT) Abroad; Increased Development of Integrated Gasification Combined Cycle (IGCC) in U.S.; Advancements of Cellulosic Ethanol in U.S. 2

3 Overall world trade in coal will increase by 1.5% Per Year to 2030 World Coal Trade: 2003, 2015, 2030 in Million Short Tons (Source: EIA, IEO 2005 and 2006) Coking Coal Steam Coal Total 3

4 The Growth of International Coal Markets World coal consumption will double from 5.4 billion short tons (2003) to 10.6 billion short tons (2030); Non-OECD countries account for 81% of projected increases in world coal consumption from 2003 to 2030; In OECD countries, growth in U.S. coal demand is strong, with moderate increases in coal consumption in South Korea, Canada, Australia/NZ, and Mexico; China and India alone will account for 70% of projected increases in world coal consumption from 2003 to

5 The Growth of Coal Markets in China and India Coal use in the electricity sector will increase 4.2% annually in China and 2.7% annually in India ( ); 2030); Coal-fired generating capacity will increase by 546 GW in China and 949 GW in India ( ); 2030); Investments in mining operations, clean-coal coal plants, and power distribution systems will be needed as the Chinese and Indian economies advance. China and India present the greatest opportunities for coal-fired power generation among the six Asia Pacific Partnership countries. 5

6 Presidential Initiative to Support Economic Growth and Poverty Reduction Launched in Sydney in January 2006 Second Policy and Implementation Committee Meeting in April 2006 Australia, China, India, Japan, South Korea, U.S. Eight Public-Private Private Sector Task Forces 6

7 Coal Share of World Energy Consumption (Source: DOE, EIA, IEO, 2006) Percent Electricity Industrial Other Sectors Total Coal Fuels Global Industrial and Electricity Sectors Electricity Generation from Coal: 40.9% (2003) to 41.4% (2030); Industrial Use of Coal: 19% (2003) to 23% (2030) World Energy Consumption from Coal: 24% (2003) to 27% (2030) 7

8 World Net Electricity Consumption: 2003 and 2030 (Source: EIA, IEO, 2006, Appendix A, Table A9) Billion Kilowatt Hours China India South Korea Mexico Aus/NZ Africa Brazil EU 25 US Electricity consumption in China and India will more than triple by 2030; South Korea and Mexico s s electricity consumption will more than double by

9 Percent Increase in Coal-Fired Generating Capacity: 2003 to 2030 (Source: EIA, IEO, 2006, Appendix F, Table F4) Brazil China South Korea India Mexico US Africa Aus/NZ EU % 136% 130% 101% 180% 240% 288% 328% 600% Brazil: 1GW in 2003; 6 GW in 2030 China: 239 GW in 2003; 785 GW in 2030 South Korea: 17 GW in 2003; 49 GW in

10 Analysis of Potential Market for CCT Equipment Exports, Cumulative 2003 to 2030 CCT Equipment Costs Supercritical Plant, 0.4 GW, 1998 Dollars (x$1000) (Source: DOE-FE: Market Based Advanced Coal Power Systems, Appendix E, May 1999) Supercritical Boiler: $60,723 Flue Gas Cleanup: $33,591 Ash/Spent Sorbent Handling System: $5,859 TOTAL: $100,173 Cost of Equipment per GW in 1998 Dollars: $250,432 Cost in 2005 Dollars: $298,015 10

11 CCT Equipment Analyzed in Study (Based on HTS Codes) Parts for auxiliary plant for use with boilers (i.e., economizers, super-heaters, soot removers, gas recoverers, condensers) Furnace burners for pulverized solid fuel Filter/Purifying machinery (ESP, SCR, etc.) Filter/Purifying machinery and apparatus parts 11

12 Worldwide Increase in Imports of U.S. CCT Equipment: 2000 to to 2005 Dollar Increase in CCT Imports from U.S. In Millions of USD (Source: World Trade Atlas) EU 25 China South Korea Australia/NZ India South Africa Brazil 12

13 2005 CCT Imports Based on HTS Number in USD Millions (Source: World Trade Atlas) U.S. Rank Imports from the U.S. Imports from the World Mexico South Korea Brazil Australia/NZ EU South Africa China India

14 Most Significant Importers of U.S. CCT Equipment (2005) Percent of CCT Equipment Imports Sourced from U.S. in 2005 (Source: World Trade Atlas) 80.0% 70.0% 60.0% 50.0% 40.0% 30.0% 20.0% 10.0% 0.0% Mexico 72.9% South Korea 33.4% 29.8% 25.1% Brazil Australia/NZ EU % 16.9% South Africa China 16.0% 12.6% India 14

15 Total World Market for CCT Equipment, Cumulative 2003 to 2030 Based on Increased Coal Fired Generation and Cost of 1 GW of CCT Equipment ($ Million) 180, , ,000 Millions of Dollars (2005) 140, , ,000 80,000 60,000 40,000 43,808 28,013 20,000 9,536 4,172 2,682 1,490 1, China US India South Korea South Africa Australia/NZ Brazil Mexico EU 25 15

16 U.S. Sales of CCT Equipment to Select Countries, Cumulative 2003 to Billions of Dollars (2005) China India South Korea Mexico Brazil Australia/NZ South Africa EU 25 16

17 Assumptions of Analysis of U.S. CCT Equipment Exports All new coal fired facilities will incorporate CCT; All facilities will be supercritical 402 MW plants; All U.S. and world market share of CCT will continue to 2030; All predicted coal-fired electricity generation will be available in 2030; All predicted CCT exports are based on trade in equipment only. Sale of U.S. licenses of CCT equipment is not incorporated in the data. 17

18 Advanced Development of IGCC Colorado to consider the construction of IGCC plants when evaluating proposals for pulverized coal plants under 350 MW; Projected decrease in cost of IGCC plants (down from initial 20%-25% 25% premium of supercritical pulverized coal plants); 2006: China, India, South Korea join FutureGen Alliance. 18

19 Office of Energy and Environmental Industries U.S. Department of Commerce Collaborates with U.S. agencies to develop public policy that advances U.S. competitiveness domestically and internationally; Evaluates economic and regulatory impacts on the U.S. energy industry, and undertakes energy-related analysis to benefit U.S. companies; Partners with U.S. agencies and foreign government counterparts on bilateral and commercial energy working group activities; Supports Commercial Service s trade promotion activities through policy missions and conferences. 19

20 Department of Commerce Coal Team Commenced officially in January 2006; Driven by OEEI and Commercial Service, with insight from MAC (country analysis) and OCEA (economic analysis); Serves as public and private sector forum for advancing the exportation of U.S. coal and coal-powered technologies abroad; Provides economic analysis of Presidential energy initiatives to advance U.S. trade; Supports coal and energy events worldwide via web-based based seminars, newsletters, and trade conferences. 20

21 DOC: Offices in the U.S. 21

22 DOC: International Offices 22

23 DOC Coal Events MINExpo, Las Vegas, September 2004 China Coal and Mining Expo, Beijing, October 2005 Coal Quality, Huntington, WV, October 2005 Coal Agg Prep, Lexington, KY, May 2006 Clearwater Coal Conference, Clearwater, FL, May 2006 Expo Min, Santiago, May 2006 National Coal Show, Pittsburgh, June 2006 Electra Mining, Johannesburg, September 2006 International Conference of Coal Ash, Pretoria, October 2006 Coal Science & Technology Conference, Indaba, October 2006 MineWest, Denver, November 2006 Coal Agg Prep, Lexington, KY, May 2007 China Coal and Mining Expo, Beijing, October

24 Department of Commerce: Export and Policy Successes CS-India India: Indian Steel Mill Sources One Million Tons (Over $100 Million) of U.S. Coking Coal From Several U.S. Coal Companies; CS-South South Korea & CS-Alaska Alaska: : Usibelli Coal Mine in Alaska Provides 800,000 Tons ($20 Million) of Alaska Coal to South Korean Power Plant, with Additional Contract Renewals; CS-Beijing Beijing: : Stalled Shenhua Coal Delivery of Two Cargo Loads to U.S. Northeast Power Plant is Resolved with Coordination Led by CS-Beijing. 24

25 Department of Commerce, Business Development Mission, Beijing and Shanghai, November 13-17, 2006 The Goals of the Mission: Assist U.S. companies that are experienced exporters enter China for the first time; Assist U.S. companies with operations in China increase their business opportunities; Address obstacles to trade with China, including transparency, IPR, rule of law; Provide information on USG trade financing programs (USTDA, EX-IM Bank, SBA) (202) 482 (202)

26 Department of Commerce, India Business Development Mission, Mumbai Summit Mission: November 29-30, 2006, Spin-Off Missions: December 4-5, 2006 The Goals of the Summit Mission: U.S. companies will meet with business, industry, and government representatives from India; Symposiums on India s s trade and investment climate; The Goals of the Spin-Off Missions: Register for Bangalore, Chennai, Hyderabad, Kolkata, Mumbai, or New Delhi; U.S. companies will benefit from market briefings, networking receptions, and one-on on-one one appointments with prospective partners, agents, distributors, and buyers. ; USA-TRADE, TRADE, Option 21 26

27 --Thank You-- Shannon Fraser Office of Energy and Environmental Industries U.S. Department of Commerce (202)