Research Overview
This Frost & Sullivan research analyzes the market for various prime
mover equipment including gas and steam turbines, medium voltage (MV) motors,
and reciprocating engines in terms of different power ratings. Covering markets
in the United States and Canada, it evaluates the current and potential
opportunities and trends for the various end-user configurations. This research
also analyzes major pricing, technological, geographical, and end-user trends,
besides identifying the various challenges that affect the market.
High Costs of Crude Oil and Natural Gas Likely to Drive Exploratory Efforts
and Demand for Prime Movers
Rising prices of crude oil and natural gas are likely to benefit the
mechanical prime mover markets in North America. Since energy requirements in
North America are huge and constantly growing, there is a strong possibility for
enhanced exploratory efforts to obtain greater supplies of crude oil and natural
gas. Given the lack of viable alternative energy sources, this trend is likely
to intensify, and thereby, drive the potential demand for mechanical prime
movers.
"With crude oil and natural gas prices continuing to remain high, the
energy demand growing inexorably, and the dependability of imported crude oil
becoming increasingly questionable, indigenous oil exploration in North America
is bound to grow. As a result, the demand for mechanical prime movers in the oil
and gas industry is likely to improve appreciably," notes the analyst of
this research service.
Compliance with Rigorous Standards and Emission Requirements – a
Strong Challenge
The North American mechanical prime mover markets for the oil and gas
industry have been adversely affected due to the stagnant economy, over the last
few years. As suppliers of equipment to this industry, prime mover manufacturers
are required to meet the increasingly stringent safety standards set by the
American Petroleum Institute (API) on the one hand, and strict emission
requirements mandated by the Environmental Protection Agency (EPA) on the other.
However, adhering to the emission regulations often involves incorporating
costly technological improvements in the products – a factor that will
impact the equipment manufacturers negatively as the market is highly
cost-driven.
Increased Overall Market Size Expected to Aid Growth of Prime Movers
Industry
With the power generation sector shifting toward natural gas as the preferred
source of energy, the push to explore gas-rich areas such as Alaska and the
Rocky Mountains and import liquefied natural gas (LNG) from countries such as
Indonesia, Australia, and Nigeria is likely to increase. Combined with the
continuing demand for gasoline, aircraft fuel and diesel, these factors
translate into improved growth for the prime mover markets.
The EPA' s emission requirements are primarily expected to drive
technological advances in these markets. Companies that develop superior designs
for gas turbines and reciprocating engines to help lower the level of
pollutants, or build advanced material technologies to sustain higher gas
turbine operating temperatures are likely to gain greater market share.
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