Analyst day – Russia & CIS Power market › sites › alstom.com › files › 2018... · export...
Transcript of Analyst day – Russia & CIS Power market › sites › alstom.com › files › 2018... · export...
Analyst day – Russia & CIS
Power market
Denis Cochet
15/03/2012
90
95
100
105
110
115
120
125
130Ju
n-08
Aug-
08
Oct
-08
Dec
-08
Feb-
09
Apr
-09
Jun-
09
Aug-
09
Oct
-09
Dec
-09
Feb-
10
Apr
-10
Jun-
10
Aug-
10
Oct
-10
Dec
-10
Feb-
11
Apr
-11
Jun-
11
Aug-
11
Oct
-11
Impact of crisis on electricity consumption by region
Unlike most industrialised regions, BRIC have over passed pre-crisis consumption levels
China
India
Brazil
Russia
USA
EUJapan
Electricity consumption (Twh 12 months moving average)
E-cons (index 1 June 2008)
20092008 2010
Financial crisis
2011
Australia
2
Russia & CISMain drivers
Most drivers turning positive and translating in investment rebound
• GDP and electricity consumption back to growth
• Electricity export plans: Russia and Central Asia to China, Georgia and Azerbaijan to Turkey
• Ageing and inefficient installed base driving needs for new build & retrofit
• Pockets of electricity deficits driven by obsolete installed base and grid + weak interconnection
• Power equipment demand also driven by district heating plants (CHP)
• High export Oil & Gas prices outlook supporting investment capability
Macro-economics
• Strong political push of Russian authorities for investment in Power
• Russian new renewable target: 4% of national power generation mix by 2020
• Localisation of production in Russia – mandatory for foreign OEM
• CIS: desire to reduce fuel dependency when importing
• Ukraine: high wind tariff in place with local content requirement
Policies
3
0%
5%
10%
15%
20%
25%
30%
2008 2009 2010 2011 2012 2013 2014 2015
Reserve margin evolution withplanned retirement and plantsunder construction
Reserve margin absorption
Plants under construction
Plant retirement
Russia & CISKey drivers evolution
GDP & Electricity consumption growth
Despite significant number of plants under construction, reserve margin will soon be absorbed: new build investment needed now
Target
GW/y
-5
-4
-3
-2
-1
0
1
2
3
4
5
11-15 16-20
Hydro
Nuclear
Gas -8%
-6%
-4%
-2%
0%
2%
4%
6%
2008 2009 2010 2011 2012 2013 2014 2015
GDP growth
e-cons growth
Source Alstom 2011
4
Steam
Russia & CIS Coal: “Most production growth targeted for export”
• Hard coal production at 248 million tons and lignite at 76 million tons
• Hard coal use dominated by exports and industrial applications (steel)
• Only 30 million tons of hard coal used for power generation (12%)
• Difficult for hard coal to compete with gas due to high mining and rail transport costs
• More coal exports being targeted for Asia
Russia Coal Production by Market
• Hard coal prices now at US$120/ton at Baltic ports, well above mining/transport costs
• Price determined by global market and mine-consumer distances (high transport costs)
• Transportation capacity limited and slow to expand
• Coal sellers get better prices in export markets than from domestic customers
Russia Baltic Export Price
Supply
Price
-
50
100
150
200
250
300
350
2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010
mmtonnes
Power - Hard Coal
Power - Lignite
Steel - Hard Coal
Other - Hard Coal
Export - Hard Coal
0
25
50
75
100
125
150
175
200
US$/ Tonne
Russian CoalFOB Baltic
Cost Range FOB Port
5% of WW production, 16% of WW reserves
5
Russia & CIS Natural Gas: “Price reform is critical issue”
• Gas production on steady rise until 2009 economic slowdown
• Economic slowdown caused− 7% decrease in gas consumption− 28% decrease in gas exports
• Production growth resuming, with rising domestic and export demand
• Huge investments underway to develop new gas fields in northern Siberia
• New pipelines (Nord Stream and proposed South Stream) to facilitate delivery to export markets
• Gas price in Russia & gas producing CIS countries very low ($1,5-4/mmBtu) due to high domestic subsidies=> hinder investment in higher efficient gas power generation and for more coal use
• Date to equalise domestic gas price with that for exports keeps getting pushed-back (now 2013-2014)
• Higher gas price for gas importing countries
Russia Gas Production and Consumption
GazProm Sales Price to Domestic and CIS market
Supply
Price
-
1
2
3
4
5
6
7
8
9$/mmBtu
Russia CIS
$5.64 Gap
18% of WW production, 24% of WW reserves
6
Russia Levelised cost of electricity – new power plants
Subsidised gas prices make gas plant most competitive, but price reform may change the picture: balanced portfolio remains the safest long term strategy for States & Power companies
0
2
4
6
CC GT Plant Coal Plant Nuclear Hydro Newdam
Hydro newunit on
existing dam
CO2 cost
Fuel
O&M
Capital
€ Cents/KWh
Fuel price assumption: • Domestic coal € 67.3/ton• Subsidised gas € 1.52/mbtu• Export gas (CIS) € 4.74/mbtu• Export gas (Europe) € 6.40/mbtu• CO2 € 0/ton
With gas export price (GazProm to CIS)
With Europe gas export price
Source Alstom 2011
7
0
5
av 9-11e av 12-15f
Geothermal
BiomassWind
Hydro
NuclearSteam
CCGT SC
GW p.a
Russia & CISNew build order forecast per technology*
Forecast
Market to rebound with diversified mix
Source Alstom 2011
*Note:Excluding industrial turbine size (GT <40MW & Conv Fossil ST <100MW)
8
Russia & CISMain customers - new build
Strong customer investment plans
9
Gas plants Nuclear Steam plants Hydro
• Gazprom• KES Holding• Basic Element• INTER RAO• Tatenergo• Fortum
• Rosatom• Energoatom
• INTER RAO• Rushydro
• Rushydro
Russia & CISCompetition in Utility Power generation
Significant Alstom market share - with growing portfolio offering
SIEMENS
POWER MACHINES
ALSTOM
GE
MHI
OthersChinese OEM
0%
100%
2009- 9m2011
All turbine orders in GW* (GT, ST, Hydro, Wind but strong GT
dominance in that period)
• Power Machine competing in all fuels: steam, nuclear, hydro
• GE, Siemens & MHI in gas plant only
• Chinese present through few subcritical steam & hydro import orders
• Alstom already strong in gas & AQCS - building positions with domestic partners in nuclear, hydro and steam
*Note:Excluding Industrial Turbine size (GT <40MW & Conv Fossil ST <100MW)
10
Russia & CISInstalled capacity by age and technology
70% of installed fleet is more than 30 years oldHalf of steam plants running on gas with low efficiency driving repowering potential
Total Installed Base 355 GW
11
0 5 10 15 20 25
1
5
9
13
17
21
25
29
33
37
41
45
49
1%
36%
8%
55%
2010 GW
2000
1990
1970
AgeYear
1980
Source: Alstom & UDI
1%
21%
3%1%
10%
63%
Status end 2010
Total Installed Base 355 GWTotal installed base 355 GW
Nuclear PlantsSteam Plants
CC GT PlantsHydro Plants
Others
Wind Plants
SC GT Plants
Solar PV
Nuclear PlantsSteam Plants
CC GT PlantsHydro Plants
Others
Wind Plants
SC GT Plants
Solar PV
In which Steam Plant By Fuel
Coal
GasBiomass
OthersSolar CSP
Oil
Geothermal
Coal
GasBiomass
OthersSolar CSP
Oil
Geothermal
Steam plant : 224 GW
IB by country > 30 years : 219 GW
Russia & CISInstalled base by country
Fuel exporters versus fuel importers is driving the mix
RussiaLarge oil & gas exporterIB: 238GW
KazakhstanOil & gas exporterIB: 18GW
AzerbaijanOil & gas exporterIB: 7GW
KyrgyzstanFuel importerIB: 4GW
TajikistanFuel importerIB: 5GW
UzbekistanGas exporterIB: 13GW
TurkmenistanGas exporterIB: 3GW
GeorgiaFuel importerIB : 4GW
ArmeniaFuel importerIB: 4GW
BelarusFuel importerIB: 8GW
UkraineFuel importerIB: 50GW
RussiaLarge oil & gas exporterIB: 238GW
KazakhstanOil & gas exporterIB: 18GW
AzerbaijanOil & gas exporterIB: 7GW
KyrgyzstanFuel importerIB: 4GW
TajikistanFuel importerIB: 5GW
UzbekistanGas exporterIB: 13GW
TurkmenistanGas exporterIB: 3GW
GeorgiaFuel importerIB : 4GW
ArmeniaFuel importerIB: 4GW
BelarusFuel importerIB: 8GW
UkraineFuel importerIB: 50GW
12
Russia & CIS Service & retrofit market
Ageing installed base driving needs for retrofit & services
• Ageing fossil fleet: ~15% of capacity not available
• Steam: - more stringent emissions standards to drive Particulate Matters (PM) upgrade and Sox retrofit longer term
- Efficiency improvement retrofit opportunities as an alternative to replacement
- Ageing district heating driving steam turbines rehabilitation needs
• Nuclear: reactor uprate, reliability & life time extension driving demand for steam turbines retrofit
• Gas:- Strong Service growth outlook supported by on-going new build
- Repowering
• Hydro: 3 out of 4 plants (55 GW) above 30 years old, driving solid long term retrofit potential with clearly identified projects short term
13
Russia & CISMarket take away
Alstom well positioned to benefit from investment rebound
• Market drivers turning positive
• Investment rebound in new build & retrofit
• Diversified mix outlook translating in solid opportunities for Thermal & Renewable Sectors
• Alstom market share expected to grow with offering across the spectrum
14
www.alstom.com