The Huge Chinese Investment in FGD and SCR will Change the Air Pollution Industry

This was the message delivered by Bob McIlvaine in the Hot Topic Hour yesterday. The discussion covered the impact on the suppliers of air pollution control equipment and on the impact on the environment.  Jeremy Schreifels of EPA weighed in on the recent smog experience in Harbin.  He pointed out that it was not unique but has happened seasonally for a long time. What is new is the media attention.  Jeremy doubts that it can be attributed to the desert dust which he says is a problem in the spring but not this time of year. The consensus is that the utility coal-fired power plants, industry, and automobiles are the cause. Tourism is down 50 percent in Beijing. This is only one of a number of negative impacts.

Jeremy believes that the Chinese government will be reducing mercury limits over time. However, the big push now is NO_x. SO₂ levels have dropped due to the FGD campaign but NO_x levels are high. So in the next five years there will be 400,000 MW of SCR retrofits plus SCR on 250,000 MW of new coal-fired power plants. 

The tough new particulate standards for power plants are likely to be followed by tough regulations on industrial emitters. China has 600,000 industrial boilers fired with coal. This compares to 1,000 in the U.S.

Bob addressed the impact of the FGD/SCR program on the world air pollution industry. He contended that every time there has been a big market developed in one region it has created international competitors. However, no other region has suddenly installed more air pollution control equipment than exists in the rest of the world.  A surge in European FGD in the 1980s only added 30 percent to the world’s FGD inventory. However, it created 50 percent of the competitors in the industry.  Based on this history, it can be expected that several Chinese suppliers will be international leaders in the industry. China will also be a regional base in Asia for international as well as Chinese companies.

The confidence that Thermo Fisher displayed in setting up its worldwide air research center in China is notable.  When you also consider that the major drug companies are setting up research centers in China, it becomes apparent that companies have confidence in their employees’ loyalty and integrity regardless of nationality.  It strengthens the argument that the future will be determined by corporations and individuals and not by governments.