The McIlvaine Company

Market For Electrostatic Precipitator Service and Parts Growing Faster Than Hardware

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Source: The McIlvaine Company

The market for electrostatic precipitators is growing despite the fact that fabric filters are taking an ever increasing market share. Fortunately, the total market is growing fast enough to compensate for the share losses. This is the forecast contained in Electrostatic Precipitator World Markets, an online continually updated service of the McIlvaine Company.

There is a distinction between sales of new equipment and sales of parts and services. Whereas the sales of new precipitators are lower than the sales of fabric filters, the sales of parts and service are larger.

Precipitator parts and service is potentially a $4.5 billion/yr. business of which $1.5 billion is parts and $3 billion is operation and maintenance (O&M). However, most of this O&M is furnished directly by the owner, reducing the outside service contracting presently to just $300 million/yr.

This parts and service segment will enjoy substantial growth. The ability to remotely monitor and even operate precipitators will allow the supplier industry to capture a significant percentage of the O&M dollar in the future.

World Market 2007.................................$ billions

Dry precipitator systems.........................$ 3.3

Wet precipitator systems........................ 0.6

Parts....................................................... 1.5

Service.................................................... 0.3

Total....................................................... 5.7

In 2005 worldwide precipitator orders were $3.3 billion. They fell to $3.2 billion in 2006, but will jump to $3.9 billion in 2007. The market swings are mainly due to the very large size of some of the projects. The decision by Texas Utilities to utilize fabric filters in eight new coal-fired plants ordered in 2006 caused the order total to be $400 million less than it would have been had the utility chosen differently.

Looking forward to 2010, China will spend more for dry electrostatic precipitators than the next four largest countries combined. However it will be a distant second to the U.S. in the purchase of wet precipitators.

The big potential for wet precipitators will come with the enforcement of the new ambient fine particulate standards. The definition of fine particulate has been expanded to include condensibles. Wet precipitators cool the gas and capture droplets and are therefore much more effective on capture of condensibles than dry collectors.

China represents more than 30 percent of the market for new precipitators but only 5 percent of the market for parts and services. Part of this is due to the very low pricing structure for services in China. Also, nearly all precipitator parts are provided by local companies.

China has several large precipitator companies each with their own manufacturing facilities. This differs from the business structure in the U.S. where all the manufacturing is sub-contracted to specialized steel fabricating companies.

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