Microturbines

Table of Contents

I. INTRODUCTION, METHODOLOGY & PRODUCT DEFINITIONS

• Study Reliability And Reporting Limitations I-1
• Disclaimers I-2
• Data Interpretation & Reporting Level I-2
• Quantitative Techniques & Analytics I-2
• Product Definitions And Scope of Study I-3
• Types of Microturbines I-3
• Simple Cycle Or Unrecuperated Microturbines I-3
• Recuperated Microturbines I-4

II. EXECUTIVE SUMMARY

1. Introduction II-1

• Current and Future Analysis II-1
• Table 1: World Market for Microturbines (2000-2010): Geographic Regions/Countries Ranked by Growth for Value Sales - Asia Pacific, Latin America, Europe, Canada US, Japan, and Middle East (includes corresponding Graph /Chart) II-2

2. Industry Overview II-3

• Micropower Industry Structure II-3
• Microturbines - A Niche Market II-3
• Crests and Troughs in Microturbine Shipments II-3
• Ups and Downs in Microturbine Industry II-4
• Promising International Markets II-4
• Capstone - The Undisputed Leader II-4
• Table 2: Leading Players in the Worldwide Microturbines Market (2005 - 2006): Percentage Share by Value Sales for Capstone Turbine Corp, Turbec, Bowman Power, Elliott, Ingersoll-Rand, and Others (includes corresponding Graph/Chart) II-5
• Capstone Takes a Micro-Plunge II-5
• Microturbine Vs. Fuel Cells II-6
• Monetary Incentives for DG Users II-6
• Microturbine are Second Most Clean Devices II-6
• Increasing Potential Applications II-6
• Microturbine Market Drivers II-7
• Microturbine Market Restraints II-7
• Other Major Factors II-7

3. Market Trends & Issues II-8

• Microturbines - The Future Electrical Era II-8
• Small Turbines Picking Up Pace II-8
• Microturbines - A Promising Market II-8
• Impact of Honeywell' s Withdrawal II-8
• Micro Solution for Macro Problem II-9
• Growing Public Awareness Boosts Microturbine Growth II-9
• Microturbines Cut Carbon Emissions II-9
• Microturbines Erode Gen-Set Sales II-9
• Microturbine Suppliers Concentrate on Higher Outputs II-10
• Recuperator Dictates O&M Costs II-10
• Alternative Technologies to Compete with Microturbines II-10
• Escalating Power Demand Jacks Microturbine Growth II-10
• Microturbines - Emerging Sources of Power II-10
• Microturbine - An Ideal Replacement for Reciprocating Engines II-11
• Factors Governing Distributed Generation II-11
• Deregulation II-11
• Safety Regulations & Standards II-11
• Emissions II-12
• Government Sponsorship II-12
• End User Awareness and Demand II-12
• 4. Product Overview II-13
• Distributed Power Generation (DG) Technology II-13
• Microturbines - An Overview II-13
• Types of Microturbines II-13
• Simple Cycle or Unrecuperated Microturbines II-13
• Recuperated Microturbines II-13
• Key Components of a Microturbine II-14
• Technology II-14
• Alternator II-14
• Power Electronics II-14
• Control Systems II-14
• Recuperator II-14
• Working of a Microturbine II-14
• Applications of Microturbines II-15
• Combined Heat and Power (Co-Generation) II-15
• Peak Shaving II-15
• Continuous Power Generation II-15
• Backup Generators II-15
• Capacity Addition II-15
• Mechanical Drive II-15
• Premium Power II-16
• Biofuel Producing Industries II-16
• Oil/Gas Recovery II-16
• Greenhouses II-16
• Remote Power II-16
• Offshore Rigs II-16
• Hospitals II-16
• Vehicle Applications II-17
• Hybrid Vehicle (Microturbine Connected to High Speed Alternator) II-17
• Hybrid Vehicle (Microturbine and Fuel Cell Together) II-17
• Advantages of Microturbine Technology II-17
• Compact Size II-17
• Reliability II-17
• Cost-Effective II-17
• Flexible Fuel Options II-17
• Low Maintenance II-17
• Clean and Quiet Operation II-18
• Excellent Modularity II-18
• Eco-Friendly II-18
• Disadvantages II-18

5. Overview of Microturbines II-19

6. Competing Alternatives to Microturbines II-20

• Internal Combustion Engine II-20
• Fuel Cells II-20
• Advantages of Fuel Cells II-20
• Photovoltaics II-20
• Wind Turbines II-21
• Flywheel II-21

7. Regulatory Environment II-22

• Energy Policy Act of 2005 to Boost Microturbine Market II-22
• Government Role in DG Industry II-22
• Federal Agencies' Role in DG Industry II-22

8. Research & Development II-23

• Ceramics: Improving Efficiency Levels in Microturbines II-23
• Microturbines Run on Wood Waste II-23

9. Product Introduction/Launches II-24

• Capstone and FuelCell Energy Introduce Hybrid Microturbines II-24
• Capstone Launches C65 Line of Microturbines II-24
• Kohler Launches New Microturbine Package II-24
• Ingersoll-Rand Widens PowerWorks Microturbine Kitty II-24
• Cummins Unveils New Microturbines II-24
• Capstone Introduces Innovative Stand-Alone Capstone 60 Microturbine II-25
• ABB Industry AG and ABB Motors Develops New MT 100 Microturbine II-25

10. Recent Industry Activity II-26

• Capstone to Supply Microturbines for Californian Health Facility Elliott Signs OEM Agreement with Northern Power II-26
• Capstone Microturbines Receive UL2200 Certification II-26
• Capstone Signs MoU with Broad II-26
• Ingersoll-Rand' s 250 kW Microturbine Receives CARB Certification II-26
• Capstone and SCS Sign Distribution Agreement II-27
• Capstone Jointly Promotes Microturbines with KeySpan II-27
• Capstone and WESCO Sign Distribution Agreement II-27
• Capstone Secures Soffimat' s Follow-On Order II-27
• Capstone Receives Order from BPC Energy II-27
• Capstone Receives Order from Integrated Building II-28
• Capstone Receives Order from Samsung II-28
• Capstone Offers C200 Microturbine to University of California II-28
• Bowman Enters into an Agreement with Jucker Energia II-28
• Capstone C60 Comply with California Emissions Requirements II-28
• Capstone and United Technologies Announce Alliance II-29
• Bowman Inks Distribution Agreement with Novalogics Integrated II-29
• Bowman Announces Supply and Distribution Agreement with Kohler II-29
• BPS Ventures with Three Japanese Companies II-29
• Advantica and Capstone in a Two-Year Agreement II-29
• MGE UPS Systems Inks Development Agreement with Capstone II-30
• EnSource Signs Agreement with Capstone II-30
• Capstone Inks Pact with Tomoe II-30
• Cummins and Capstone Script 3-Year Agreement II-30
• Deal Between Capstone and Totalsupport II-30
• Capstone Bags Orders from SCAQMD II-30
• Contract for Capstone from Takuma II-31
• Capstone Strikes Deal with LADWP II-31
• Capstone Grabs US$3 Million Order from DOE II-31
• Capstone Microturbine Gets Clearance from CARB II-31
• Capstone Microturbine Achieves UL Certification II-31
• EMCON/OWT Installs First Commercial Microturbine Landfill Gas System II-31
• Capstone Announces Installation of largest Microturbine Landfill Gas System II-32
• General Motors to Install Microturbines and Solar Power in California II-32
• Energy Technology Division of CSIRO Completes Installation II-32
• Capstone Forms Strategic Alliance with Mitsubishi II-32
• Capstone and Solar Turbines Inks Licensing Agreement II-32
• Capstone Inks Distribution Agreement with Invensys and ECO II-32
• ABB Bags US$100 Million Contract from Scottish and Southern Energy II-33
• Capstone Secures orders from Mariah Energy and American Energy Savings II-33
• A Flurry of Contracts for Capstone Turbine Corp II-33
• Capstone to Develop Advanced Microturbine System for DOE II-33
• Ingersoll-Rand Establishes Ingersoll-Rand Energy Systems II-34
• Capstone Microturbines gets Approval for Grid Interconnection II-34
• Capstone Low-Pressure Gaseous Fuel Microturbine Complies UL Standards II-34

11. Focus on Select Players II-35

• ABB (Switzerland) II-35
• Bowman Power Group (UK) II-35
• Capstone Turbine Corporation (US) II-35
• Cummins Inc. (US) II-35
• Elliot Energy Systems (US) II-36
• Ingersoll-Rand Company Limited (US) II-36
• Turbec Spa (Italy) II-37

12. Global Market Perspective II-38

• Table 3: World Recent Past, Current & Future Analysis for Microturbines by Geographic Region - US, Canada, Japan, Europe, Asia-Pacific (excluding Japan), Middle East, and Latin American Markets Independently Analyzed Independently Analyzed with Annual Sales Figures in US$ Million for Years 2000 through 2010 (includes corresponding Graph/Chart) II-38
• Table 4: World 11-Year Perspective for Microturbines by Geographic Region - Percentage Breakdown of Value Sales for US, Canada, Japan, Europe, Asia-Pacific, (excluding Japan) Middle East, and Latin America for Years 2000, 2005 & 2010 (includes corresponding Graph/Chart) II-39

III. MARKET

1. The United States III-1

• A. Market Analysis III-1
• Current and Future Analysis III-1
• Distributed Generation in the US III-1
• Rising Demand for Electricity Generation Equipment III-1
• Key Factors Affecting the Microturbine Market in US III-2
• Microturbine Market in North America III-2
• Table 5: Power Plant Scale in US (2000): A Comparison by Type of Power Plant - Single-Cycle Gas Turbine, Industrial Cogeneration Plant,Wind Turbine, Microturbine, Residential Fuel Cell and Household Solar Panel III-2
• Market Drivers III-2
• Power Quality and Supply Issues III-2
• End-User Demand III-2
• Low Environmental Pollution Issues III-3
• Microturbine Market Potential III-3
• Power Generation Market in the US III-3
• A Highly Decentralized Market III-3
• Environmental Policies Guiding the Power Generation Market III-4
• Select Players III-4
• Capstone Turbine Corporation III-4
• Cummins Inc III-4
• Elliott III-5
• Ingersoll-Rand III-5
• Product Introductions/Launches III-5
• Strategic Developments III-7
• B. Market Analytics III-13
• Table 6: US Recent Past, Current & Future Analysis for Microturbines - Annual Sales Figures in US$ Million for Years 2000 through 2010 (includes correspondingGraph/Chart) III-13

2. Canada III-14

• A. Market Analysis III-14
• Current and Future Analysis III-14
• Microturbine Market in Canada III-14
• Overview of Canadian Power Sector III-14
• Microturbines Market in Canada - Peeping to Lease III-14
• B. Market Analytics III-15
• Table 7: Canadian Recent Past, Current & Future Analysis for Microturbines - Annual Sales Figures in US$ Million for Years 2000 through 2010 (includes corresponding Graph/Chart) III-15

3. Japan III-16

• A. Market Analysis III-16
• Current and Future Analysis III-16
• Strategic Developments III-16
• B. Market Analytics III-17
• Table 8: Japanese Recent Past, Current & Future Analysis for Microturbines - Annual Sales Figures in US$ Million for Years 2000 through 2010 (includes corresponding Graph/Chart) III-17

4. Europe III-18

• A. Market Analysis III-18
• Current and Future Analysis III-18
• Table 9: European Market for Microturbines (2000-2010): Geographic Regions/Countries Ranked by Growth for Value Sales - Italy, Germany, France, Spain, Russia, United Kingdom, and Rest of Europe (includes corresponding Graph/Chart) III-18
• Liberalization - The Market Generator III-19
• Microturbine Market III-19
• Factors Impacting the Microturbines Market III-19
• Economic Growth III-19
• High Utility Orders III-20
• Demand for Power, Heating and Cooling III-20
• Competition III-20
• Persistent High Unit Price III-20
• Technology Problems III-20
• Utility Standards III-20
• New Technologies III-20
• Major Barriers III-20
• High Capital Costs III-20
• Short Lifespan of the Unit III-21
• Development of Alternative Systems III-21
• B. Market Analytics III-21
• Table 10: European Recent Past, Current & Future Analysis for Microturbines by Geographic Region - France, Germany, Italy, the UK, Spain, Russia, and Rest of European Markets Independently Analyzed Independently Analyzed with Annual Sales Figures in US$ Million for Years 2000 through 2010 (includes corresponding Graph/Chart) III-21
• Table 11: European 11-Year Perspective for Microturbines by Geographic Region - Percentage Breakdown of Value Sales for France, Germany, Italy, the UK, Spain, Russia, and Rest of Europe for Years 2000, 2005 & 2010 (includes corresponding Graph/Chart) III-22

4a. France III-23

• A. Market Analysis III-23
• Current and Future Analysis III-23
• Strategic Development III-23
• B. Market Analytics III-23
• Table 12: French Recent Past, Current & Future Analysis for Microturbines - Annual Sales Figures in US$ Million for Years 2000 through 2010 (includes corresponding Graph/Chart) III-23

4b. Germany III-24

• A. Market Analysis III-24
• Current and Future Analysis III-24
• B. Market Analytics III-24
• Table 13: German Recent Past, Current & Future Analysis for Microturbines - Annual Sales Figures in US$ Million for Years 2000 through 2010 (includes corresponding Graph/Chart) III-24

4c. Italy III-25

• A. Market Analysis III-25
• Current and Future Analysis III-25
• Turbec Spa - A Key Player III-25
• Strategic Development III-25
• B. Market Analytics III-26
• Table 14: Italian Recent Past, Current & Future Analysis for Microturbines - Annual Sales Figures in US$ Million for Years 2000 through 2010 (includes corresponding Graph/Chart) III-26

4d. The United Kingdom III-27

• A. Market Analysis III-27
• Current and Future Analysis III-27
• B. Market Analytics III-27
• Table 15: UK Recent Past, Current & Future Analysis for Microturbines - Annual Sales Figures in US$ Million for Years 2000 through 2010 (includes corresponding Graph/Chart) III-27

4e. Spain III-28

• A. Market Analysis III-28
• Current and Future Analysis III-28
• B. Market Analytics III-28
• Table 16: Spanish Recent Past, Current & Future Analysis for Microturbines - Annual Sales Figures in US$ Million for Years 2000 through 2010 (includes corresponding Graph/Chart) III-28

4f. Russia III-29

• A. Market Analysis III-29
• Current and Future Analysis III-29
• Strategic Development III-29
• B. Market Analytics III-29
• Table 17: Russian Recent Past, Current & Future Analysis for Microturbines - Annual Sales Figures in US$ Million for Years 2000 through 2010 (includes corresponding Graph/Chart) III-29

4g. Rest of Europe III-30

• A. Market Analysis III-30
• Current and Future Analysis III-30
• B. Market Analytics III-30
• Table 18: Rest of Europe Recent Past, Current & Future Analysis for Microturbines - Annual Sales Figures in US$ Million for Years 2000 through 2010 (includes corresponding Graph/Chart) III-30

5. Asia-Pacific III-31

• A. Market Analysis III-31
• Current and Future Analysis III-31
• Asia-Pacific offers Huge Potential III-31
• India III-31
• Microturbines - A Credible Power Generation Alternative III-31
• Distributed Generation Growth Drivers III-31
• Distributed Generation Deterrents III-32
• Strategic Development III-32
• B. Market Analytics III-33
• Table 19: Asia-Pacific Recent Past, Current & Future Analysis for Microturbines - Annual Sales Figures in US$ Million for Years 2000 through 2010(includes corresponding Graph/Chart) III-33

6. The Middle East III-34

• A. Market Analysis III-34
• Current and Future Analysis III-34
• An Overview of Microturbine Market III-34
• B. Market Analytics III-35
• Table 20: The Middle East Recent Past, Current & Future Analysis for Microturbines - Annual Sales Figures in US$ Million for Years 2000 through 2010 (includes corresponding Graph/Chart) III-35

7. Latin America III-36

• A. Market Analysis III-36
• Current and Future Analysis III-36
• B. Market Analytics III-36
• Table 21: Latin American Recent Past, Current & Future Analysis for Microturbines - Annual Sales Figures in US$ Million for Years 2000 through 2010 (includes corresponding Graph/Chart) III-36

IV. COMPETITION

• 1. ABB Ltd. (Switzerland) IV-1
• Table 22: First Quarter Sales Analysis: 2005-2006 (In US$ million) IV-2
• Table 23: Annual Sales Analysis: 2003-2005 (In US$ million) IV-2
• Table 24: Annual Sales Analysis by Segment: 2004-2005 (In US$ million) IV-3
• Table 25: Annual Sales Analysis by Geographic Region: 2004-2005 (In US$ million) IV-3
• 2. ALM Turbine, Inc. (USA) IV-10
• 3. AMT Netherlands BV (The Netherlands) IV-11
• AMT USA LLC (Aviation Microjet Technology) (USA) IV-11
• 4. Baird Micro Turbines (Pty.,) Ltd. (South Africa) IV-12
• 5. Bowman Power Group Limted (UK) IV-13
• 6. BPC Energy Systems (Russia) IV-13
• 7. Capstone Turbine Corporation (USA) IV-14
• Table 26: Annual Sales Analysis: 2005-2006 (In US$ million) IV-15
• Table 27: Annual Sales Analysis by Geographic Region: 2005-2006 (In US$ million) IV-15
• Table 28: Annual Sales Analysis by Geographic Region: 2004-2005 (In US$ million) IV-16
• 8. Cummins, Inc. (USA) IV-20
• Table 29: First Quarter Sales Analysis: 2005-2006 (In US$ million) IV-22
• Table 30: First Quarter Sales Analysis by Segment: 2005-2006 (In US$ million) IV-22
• Table 31: First Quarter Sales Analysis by Geographic Region: 2005-2006 (In US$ million) IV-23
• Table 32: Annual Sales Analysis: 2004-2005 (In US$ million) IV-23
• Table 33: Annual Sales Analysis by Quarter: 2004-2005 (In US$ million) IV-23
• Table 34: Annual Sales Analysis by Geographic Region: 2004-2005 (In US$ million) IV-23
• 9. Elliott Energy Systems, Inc. (USA) IV-27
• 10. Fuelcell Energy, Inc. (USA) IV-29
• Table 35: Half Yearly Sales Analysis: 2005-2006 (H1) (In US$ million) IV-29
• Table 36: Half Yearly Sales Analysis by Operation: 2005-2006 (H1) (In US$ million) IV-30
• Table 37: Annual Sales Analysis: 2004-2005 (In US$ million) IV-30
• Table 38: Annual Sales Analysis by Operation: 2004-2005 (In US$ million) IV-30
• Table 39: Annual Sales Analysis by Geographic Region: 2004-2005 (In US$ million) IV-30
• 11. General Electric Company (USA) IV-33
• Table 40: First Quarter Sales Analysis: 2005-2006 (In US$ billion) IV-37
• Table 41: Annual Sales Analysis: 2003-2005 (In US$ billion) IV-37
• Table 42: Annual Sales Analysis by Segment: 2004-2005 (In US$ billion) IV-37
• 12. Honeywell International, Inc. (USA) IV-52
• Table 43: First Quarter Sales Analysis: 2005-2006 (In US$ million) IV-54
• Table 44: First Quarter Sales Analysis by Segment: 2005-2006 (In US$ million) IV-54
• Table 45: Annual Sales Analysis: 2003-2005 (In US$ million) IV-55
• Table 46: Annual Sales Analysis by Quarter: 2004-2005 (In US$ million) IV-55
• Table 47: Annual Sales Analysis by Segment: 2004-2005 (In US$ million) IV-55
• Table 48: Annual Sales Analysis by Geographic Region: 2004-2005 (In US$ million) IV-55
• 13. Ingersoll-Rand Company Limited (USA) IV-63
• Table 49: First Quarter Sales Analysis: 2005-2006 (In US$ million) IV-64
• Table 50: First Quarter Sales Analysis by Segment: 2005-2006 (In US$ million) IV-65
• Table 51: Annual Sales Analysis: 2003-2005 (In US$ million) IV-65
• Table 52: Annual Sales Analysis by Segment: 2004-2005 (In US$ million) IV-65
• Table 53: Annual Sales Analysis by Geographic Region: 2004-2005 (In US$ million) IV-65
• Ingersoll-Rand Energy Systems (USA) IV-67
• 14. Integrated Building Technologies (Italy) IV-68
• 15. KeySpan Energy Delivery (USA) IV-68
• 16. Kohler Power Systems (USA) IV-69
• 17. MGE UPS Systems (France) IV-71
• 18. Northern Power Systems (USA) IV-75
• 19. Ormat Industries Ltd. (Israel) IV-78
• Ormat Technologies, Inc. (USA) IV-79
• Table 54: Half Yearly Sales Analysis: 2005-2006 (H1) (In US$ million) IV-80
• Table 55: Half Yearly Sales Analysis by Segment: 2005-2006 (H1) (In US$ million) IV-80
• Table 56: Annual Sales Analysis: 2004-2005 (In US$ million) IV-80
• Table 57: Annual Sales Analysis by Segment: 2004-2005 (In US$ million) IV-81
• Table 58: Annual Sales Analysis by Geographic Region: 2004-2005 (In US$ million) IV-81
• 20. Samsung Corporation (South Korea) IV-83
• 21. Simjet (Denmark) IV-84
• 22. Soffimat (France) IV-84
• 23. Solo Energy Corporation (USA) IV-85
• 24. Turbec SpA (Italy) IV-85
• Turbec AB (Sweden) IV-86
• 25. Turbo Power Systems (UK) IV-87
• Table 59: First Quarter Sales Analysis: 2005-2006 (In £ million) IV-87
• Table 60: First Quarter Sales Analysis by Segment: 2005-2006 (In £ million) IV-88
• Table 61: Annual Sales Analysis: 2004-2005 (In £ million) IV-88
• Table 62: Annual Sales Analysis by Segment: 2004-2005 (In £ million) IV-88
• 26. United Technologies Corporation (USA) IV-89
• Table 63: First Quarter Sales Analysis: 2005-2006 (In US$ million) IV-91
• Table 64: First Quarter Sales Analysis by Operation: 2005-2006 (In US$ million) IV-91
• Table 65: Annual Sales Analysis: 2003-2005 (In US$ million) IV-91
• Table 66: Annual Sales Analysis by Operation: 2004-2005 (In US$ million) IV-92
• Table 67: Annual Sales Analysis by Geographic Region: 2004-2005 (In US$ million) IV-92
• UTC Power (USA) IV-94
• 27. Wesco Distribution, Inc. (USA) IV-96