New York – A new market research report, The Market for Power Station Maintenance Repair and Overhaul (MRO) in Key African Countries, finds that aging facilities and new builds will drive growth in this market.
The Energy and Power Systems (EPS) business unit within Frost & Sullivan constantly monitors global maintenance, repair and overhaul (MRO) markets within the energy and power industry. This research service provides a concise analysis of the current state of the power plant maintenance, repair and overhaul markets in South Africa, Nigeria, and Zambia.
The analysis covers key trends within each country through an overview of market drivers and restraints, key legislative trends, and provides a competitive analysis for these three key African MRO markets. Here are some highlights from this latest report.
- The electricity generating sector is capital intensive, not only for construction but also for operations where both unscheduled and scheduled high-value maintenance is periodically needed to keep power stations running.
- Boilers are mainly used in industrial applications or in coal-fired power stations. The utility-scale boiler markets outside of South Africa are currently insignificant; however, as new coal-fired projects are planned, opportunities will open up.
- Nigeria has the highest estimated growth rate in terms of future MRO use. Growth is coming from a low base and will be powered by an expected post-privatisation boom.
The generating capacity in South Africa and Zambia was largely built in the 1970s or early 1980s. Investment in the respective power sectors has not risen to an adequate level. As such, power stations in each country struggle with aging equipment. In Nigeria, power station construction has been constrained.
Large contract competition drives the MRO market. Nigeria has historically operated without large contracts, South Africa has operated with a few large, centrally-managed maintenance contracts, and Zambia has only used temporary unscheduled contracts. All countries are moving towards more comprehensive maintenance contracts that will allow the generating assets to achieve improved performance. Zambia is an exception, as MRO is expected to continue to be managed in-house.
The MRO markets in each of the covered countries are set to grow. This is driven primarily by the need for a better-performing electricity-generating sector and secondly by an expanding generation capacity.
In countries where maintenance spending has been low in the past, performance problems are necessitating its ramped up implementation. South Africa and Nigeria share this specific characteristic.
In South Africa:
- Generation capacity is expanding in line with the Integrated Resource Plan (IRP) 2010. By 2030, generation capacity is expected to double.
- Coal will remain the dominant feedstock with large increments in nuclear, gas, and renewables.
- All of South Africa's generation capacity is available to generate electricity, except that which is either under scheduled or unscheduled maintenance.
- Generation capacity growth in Nigeria is driven by a historically inadequate supply. The absence of power has driven the widespread use of private generators.
- The current expansion drive and its resulting privatization programs will lead to capacity expansion.
• A portion of Nigeria's generating capacity is unavailable to generate electricity, and the rest of the capacity is subject to sporadic operation with poor maintenance practices.
- Zambia is almost entirely reliant on hydro-powered electricity. The expansion drive in Zambia is driven by the potential to export electricity to neighbouring countries as the internal demand is relatively small.
- All available capacity is operational, however it suffers from high unscheduled maintenance due to station age.
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