ANNUAL REPORT

ANSALDO ENERGIA FINANCIAL STATEMENTS 2009
29
Market prospects and competitive
positioning
Global performance of the power generation
market and prospects
The global economic recession in 2009, after a
decade of annual growth in excess of 3.5%, has
caused a reduction in global demand for electric
power of about 1.1%.
In Europe this figure is about 5%. Shrinking
revenues, in conjunction with the uncertain
financial situation, have caused most power
producers to revise their investments in new
generating capacity significantly in the short term,
after an impressive 2007-2008.
The global market for power generation
components in 2009 has therefore been estimated
at about 50% of the values in the same period of
the previous year.
This dramatic collapse in demand has affected
almost all types of electric power generation plant,
although the most affected have been those with a
high initial investment and long construction times,
such as coal-fired, hydro-electric and nuclear power
plants, which fell by more than 60%.
So far as concerns gas plants, the drop is in the
order of 45-50%, whereas the wind power industry
has seen orders fall by about 30%.
The solar power market has bucked the trend, with
incentives recently introduced in many countries
driving higher investment volumes.
The current macro-economic context, despite the
fact that various indicators have pointed to the
return of moderate optimism in the last quarter of
2009, suggests that demand will remain weak, at
least in the first half of 2010.
The awaited economic recovery, in conjunction with
the factors that continue to support demand for
electric power, including demographic growth,
improving lifestyles, and the need to renew and
maintain the existing generation fleet, nevertheless
guarantee good prospects in the medium and long
term for the electric power generation plant and
component market, both as regards the big fossil
fuel and nuclear plants, as well as for technologies
that exploit renewable sources and distributed
generation.
The reduced plant usage factor, combined with
strict cost containment policies by energy
operators, have caused a slight slowdown in
service investments too, a sector that is
underpinned by constant growth.
Performance of the thermo-electric sector and
prospects
Globally, demand for thermo-electric power plant
components reported a fall of about 55% in 2009
compared with the same period in 2008.
The market for gas cycles in traditional target
geographical areas for Ansaldo Energia reported a
downturn in demand in line with the global context,
marking a return to 2006 market levels.
Western Europe, where demand held up in the first
few months of 2009 as a result of the
confirmation of several large investments prepared
during 2008, reported a sharp slowdown in the
second half of the year.
The Middle East, supported by a major order in
Iraq, and North Africa are the areas least affected
by the fall in demand, which has however hit areas
like Eastern Europe and Russia hard.
In the gas turbine market in target regions,
Ansaldo Energia market share in 2009 stands at
6%, which is in line with the results delivered in
2007-2008.
Turning to gas turbine technology in the same
geographical areas, General Electric, while halving
the number of machines sold, confirms its position
of market leadership with a share of greater than
40%, while Siemens, thanks to a major order in
Iraq, has seen its share rise to 35% for the first 9
months of 2009, at the expense of Alstom and
more importantly Mitsubishi, which reported a
sharp drop in orders in the same period.
PERFORMANCE