Engineering Inc. - November/December 2010 - (Page 5)

BY J O E SA L I M A N D O MarketWatch Power Demand Leads to New Opportunities for Member Firms E ven without the smart grid, the introduction of electric vehicles (EVs) and additional wind and solar power generation to the national energy infrastructure will require extensive expansion, renovations and rehabilitation of existing power networks. Much of the nation’s power future remains in question. The federal government jump-started national smartgrid investment with $4.5 billion in stimulus money to fund numerous demonstration projects. But no one knows what might comprise the “second act.” It’s highly possible that as use of EVs grow, local distribution systems will require re-engineering and other significant upgrades. One commonly described scenario involving the advent of EV home chargers could mean severe strain on local power networks not properly retrofitted to handle added capacity. Subsequent network expansions should increase opportunities for engineering firms. Power Construction: Actual Spending (Dollars in billions) Period Calendar 2003 Calendar 2004 Calendar 2008 Calendar 2009 Jan–July 2009 Jan–July 2010 Total Construction $915.74 $1,027.74 $1,072.13 $939.06 $521.99 $480.31 Nonresidential Construction $213.88 $235.11 $350.08 $252.16 $136.90 $136.90 Natural Gas Power $27.93 $27.74 $68.70 $77.00 $43.49 $39.74 Power as % of Nonres 13% 12% 20% 30% 32% 28% Spending is real, not seasonally adjusted. Source: Reports at www.census.gov/const/www/prpage.html Power Construction: Spending Forecast (Dollars in billions) Year 2010 2011 2012 2013 2014 Gain, ’10 to ’14 Total Construction $885.84 $921.30 $1,009.84 $1,094.82 $1,190.86 + 34.4% Power $94.02 $102.48 $112.73 $125.12 $142.64 + 62.3% Source: FMI Corp. Q2 Construction Outlook, downloadable (16p PDF) from www.fminet.com/assets/research/Outlook_2Q10.pdf Extra-High Voltage Another offshoot of the projected increase in power demand is the need for longdistance extra-high voltage (EHV) transmission lines for large solar and wind power generation facilities. These would be brand-new power lines designed to transport massive amounts of electricity—estimated at 345 kV, compared with the current 35 kV or 100 kV—from optimal desert generating facilities to population centers. The need to construct EHV power lines—an expensive proposition that is national in scope—has already been endorsed in speeches by Bush administration Energy Secretary Spencer Abraham (2001–2005) and current Energy Secretary Stephen Chu. Workforce Issues The anticipated increased power need is also renewing interest in electrical engineering, which had been in decline, experts say. At the September GridWise Global Forum, Mohammad Shahidehpour, an Illinois Institute of Technology professor, said his classes are now drawing 75 or more students, compared with 10–15 students just a few years ago. A Portland State University professor also reported that his two-semester smart-grid class, originally capped at 50 students, attracted 125 enrollments—with 16 listing Ph.D.s after their names. Wanda Reder, past president of the IEEE Power & Energy Society, noted that the electric utility industry expects to lose more than 50 percent of its power engineers in the next five years. Opportunity In the Trillions? Many encouraging signs are present for engineering firms regarding expansion and redevelopment of the national power grid—none, however, more encouraging than cost, which industry watchers pro ject will reach the trillions. Speaking at an investment conference in September, Jim O’Neil, president and COO of Quanta Services, a leading power transmission and distribution contractor, said, “We believe the outlook for the electric power market is robust. The U.S. utility industry will have to invest between $1.5 trillion and $2 trillion between 2010 and 2030 to maintain current levels of reliable energy service for customers throughout the country. “This includes $880 billion for the nation’s transmission and distribution systems and $85 billion for advanced metering infrastructure, and energy-efficient demand response programs.” On the low end, $1.5 trillion over two decades means $75 billion a year annually for 20 years! Joe Salimando writes on construction at www.electrical contractor.com. Reach him at ecdotcom@gmail.com. ENGINEERING INC. NovEmbER / DECEmbER 2010 5 http://www.census.gov/const/www/prpage.html http://www.fminet.com/assets/research/Outlook_2Q10.pdf http://www.electricalcontractor.com http://www.electricalcontractor.com

Table of Contents for the Digital Edition of Engineering Inc. - November/December 2010

Engineering Inc. - November/December 2010
Contents
From ACEC to You
News and Notes
Market Watch
Legislative Action
Power Play
2010 Fall Conference Highlights
Ins and Outs
Re-energized
Business Insights
Young Professionals of the Year
Members in the News

Engineering Inc. - November/December 2010