Chuck Sakers, Couplings Technology Leader, Kop-Flex, at Regal Beloit discusses torque monitoring, the importance of coupling reliability, and how to gain more value from existing couplings.

Regal Beloit is a manufacturer of power transmission products as well as electric motors, electrical motion controls and power generation equipment. It is headquartered in Beloit, Wisconsin and has engineering, manufacturing, sales and service facilities throughout the world. The company is comprised of three operating segments: Commercial and Industrial Systems, Climate Solutions and Power Transmission Solutions.

The Kop-Flex brand has served the turbomachinery industry for more than 50 years, offering services and solutions like High Performance Disc 2.0, Perceptive Technologies and the Powerlign torque monitoring system. Kop-Flex delivers solutions for oil and gas, power generation, and aerospace and defense in the turbomachinery space. In addition, Kop-Flex offers a full range of coupling products that serve the metals, pulp and paper, and heavy industry markets.

Data demand has exploded for data and information about how couplings are designed and selected, how they are manufactured, how they operate, how they are maintained, and how they are serviced. The coupling industry is catching up with the rest of the world in the data revolution.

Just like you and I track our orders from Amazon and get regular updates during the process, customers are looking for the same easily accessible live data for couplings. The procurement team needs quick access to product information to make purchases. Project managers are looking at Gantt charts to understand more about the process and status while couplings are being designed and manufactured. Installation and maintenance teams always need access to manuals and service experts. Our Kop-Flex team is building a complete digital customer experience (DCX) to support these goals.

We have been gathering data from couplings that allows plant operators to make smarter maintenance decisions by monitoring performance trends with our Powerlign torque monitoring system. In addition, our Perceptive Technologies group uses an array of torque monitoring solutions for online monitoring, predictive maintenance and failure analysis. This includes the use of augmented reality tools.

Also, there is definitely a trend to have spares for all critical equipment. This is a lesson often learned after a field issue. Having that spare coupling on hand without having to transport parts across the country or the globe, ready to use, minimizes downtime. Many customers have purchased a spare to install at the next turnaround. They send the main coupling back to our Kop-Flex team for recertification.

What is your coupling recertification service?

Disc and diaphragm couplings are not a ‘wear item’ like the seals in a turbine or compressor, which can cause a decrease in equipment performance and are typically replaced on a time-based schedule. Most high-performance couplings are designed to be maintenance-free.

If they are operated within their rated capacities, they can outlast the equipment to which they are connected. To maximize production, each asset, critical or not, should have an appropriate maintenance strategy that is followed, audited for effectiveness, and adjusted as necessary to ensure reliability.

However, equipment upgrades, shifting foundations, process changes, environmental factors and handling can push the coupling outside of its design operating envelope. The recertification service allows end users to evaluate couplings and conduct repairs, if necessary, during scheduled downtimes to prevent unplanned outages. Recertification is targeted at the API 671/ISO 10441 market, but is available for most coupling types.

Kop-Flex has been recertifying couplings for over 15 years and services more than 150 couplings per year. The team does a full teardown and inspection of each component. They replace components as needed with new parts made to the original drawings and design standards. Recertification restores couplings to a like-new condition for about half the cost of a replacement.

What other products might our users be interested in?

The Kop-Flex Powerlign torque monitoring system allows users to minimize emissions and fuel costs by tracking performance trends in connected equipment. This system can be purchased new with couplings or retrofitted to existing Kop-Flex or other brand couplings.

We also offer a Max-C resilient coupling that provides damping for applications with shock loading or cyclic torques. The Max-C can be mated to disc or diaphragm couplings to tune the drive train. They are frequently used on synchronous and variable frequency drive motors.

What products do you have in the pipeline?

Our teams are always working to provide optimal solutions for the most challenging applications. We have a great focus on providing lightweight, cost-effective and highly reliable solutions for the industry.

There are some exciting ideas in the pipeline, and a lot of the ideas are spawned from our Perceptive Technologies team. They are working directly with customers to understand new challenges that arise in the field and finding unmet needs. The beauty of this team is that they support our whole Regal Power Transmission Solutions business. So, we get a lot of benefit from cross-pollination of ideas and economy of scale from other industries that we serve, like food and beverage and HVAC.

What is the company doing to cope with the current slowdown?

Regal is committed to supporting its associates, customers and communities through the Covid-19 pandemic. It is a rapidly changing situation, and we are working diligently to maintain focus and support essential business while making the best decisions for safety.

Articles

Improving coupling reliability

When failures occur in turbomachinery, they typically result from one or more mechanisms. This may include fatigue, environmentally assisted or stress corrosion cracking, creep rupture, erosion and foreign object damage.

In many cases, the residual stress levels present in the component play an important role in either extending life with favorable residual stresses or diminishing it with unfavorable ones.

Since residual stresses are introduced in practically every step of turbomachinery machining and fabrication processes, their effects must be considered, understood and managed to maximize component life and performance.

By controlling or introducing engineered residual stresses, premature failures can often be mitigated, and the service life of components extended. Accurate quantitative measurement of residual stress in components is necessary to achieve this goal.

 Measuring residual stress on a turbine blade via the x-ray diffraction technique[/caption]

Stress corrosion cracking (SCC), also known as environmentally assisted cracking, is sometimes characterized as stress-assisted, grain-boundary oxidization (SAGBO) in high-temperature applications. It is a major source of potential failures in the power industry, as well as in process industries, pulp mills, storage vessels, and even aircraft structures.

 Figure 1: Synergy is required for stress corrosion cracking to occur[/caption]

Sustained tensile stress (resulting from the superposition of residual and applied stresses) above a material’s SCC threshold is the main component of the stress corrosion cracking triangle (Figure 1).

Other factors are a susceptible material and a slightly corrosive environment. SCC is characterized by selective intergranular corrosion whereby multiple cracks initiate and eventually propagate.

The most obvious solution to SCC is to change the environment. However, that is rarely possible. The addition of a coating can, in principle, break the SCC synergy by sequestering the material from its environment. But this is often impractical or only a short-term solution if the coating wears or degrades over time.

Another approach is to change the material to one less susceptible to SCC. That can be either expensive or unfeasible. Thermal stress relief can be used to help reduce the magnitude of tensile residual stresses to levels below the SCC threshold.

However, if heating reaches the annealing temperature, as would be required to effectively stress-relieve the component, heat treatment itself may negatively affect the desired material’s mechanical properties. Heat treatment is, therefore, only a partial solution in many instances.

Often, the only effective solution to the SCC problem is the introduction of compressive residual stresses. A variety of stress management methodologies can be used to impart compressive residual stresses into a component.

This can include peening, rolling, expanding and their variants. Some are typically applied at the time of fabrication (e.g., shot peening, laser shock peening (LSP), cavitation peening and rolling).

Others can be applied in the field on components already in service (e.g., ultrasonic impact treatment (UIT), flapper peening and split-sleeve cold expansion (Cx). SCC synergy can be broken if the compressive residual stresses imparted are sufficient to overcome the sustained in-service applied stresses and keep the total magnitude of stress below the SCC threshold.

Quantitative residual stress measurement methods, including x-ray diffraction (XRD), can be used to characterize the stress state of components that may be susceptible to SCC either before or after they have been put into service.

This helps verify that a compressive residual stress of sufficient magnitude has been installed (one that overcomes any in-service applied stresses so that the total residual stress level remains below the SCC threshold).

 Figure 2: Residual stress vs. depth profiles for ground and shot-peened Ck45 steel[/caption]

Take the case of ground and shot-peened Ck45 steel (Figure 2). Residual stress measurements via XRD were used to compare the effects of grinding and shot peening on the surface and subsurface residual stress state of a component prior to being placed into service. This indicated that the residual stress of the component became more compressive after being shot peened.

When turbomachinery components undergo cyclic loading, they can become susceptible to high-cycle fatigue (HCF) or low-cycle fatigue (LCF). In cases of LCF failures, the in-service stress exceeds the cyclic elastic limit of the material.

LCF is characterized by cumulative fatigue damage associated with failure occurring in the range of 104 to 105 cycles and multiple cracks in highly stressed areas. Residual stresses can evolve with cumulative fatigue damage and can be monitored periodically at predefined inspection intervals to assist in assessing component condition.It has been demonstrated that LCF life is sensitive to changes in residual stress. A 5% to 10% difference in stress can result in a 50% difference in lifespan. Thus, errors in the representation of total stress have a profound effect on life if residual stress is not considered.

The longer fatigue lives, as in the case of HCF, failures generally initiate at precise stress-concentration sites with cracks propagating from a single initiation. Residual stresses remain constant until close to the end of a component’s life; thus, an understanding of the residual stress state at the start of life is critical.

The ways in which surface and near-surface residual stresses have impacted fatigue-life underscore the importance of studying surface treatments and manufacturing processes. If reliable fatigue-life estimates are to be made (for example, via fracture-mechanics predictions), it is necessary to accurately characterize the residual stress fields.

Fatigue life can be extended and failures mitigated by the introduction of engineered residual stresses via a variety of processes, including Cx, LSP, shot peening, cavitation peening, burnishing and UIT (Figure 3).

 Figure 3: Bending fatigue S-N curves for Ck45 steel tested in sea water. This illustrates the positive effect of shot peening on fatigue life[/caption]

Such treatments should be optimized for specific application to maximize effectiveness. By obtaining accurate information about the in-service loading spectra, material properties, component geometry, and residual stress fields, more reliable life-assessment and fracture-mechanic predictions can be made.

Erosion and creep should also be considered. The interaction of liquids or particles in the gas path of turbomachinery can result in the erosion of certain components. The loss of material due to erosive impacts can compound into a loss of cross section, the formation of pits, and eventually, the formation of micro-cracks at the surface.

In combination with cyclic loading, the stress concentrations at a crack tip may provide sufficient energy for fatigue cracks to initiate and propagate. Steam turbine blades that operate at relatively high temperatures can be especially susceptible to erosion resulting from the exfoliation of tubing scales in the system or from liquid droplet erosion.

Understanding and managing residual stresses at susceptible locations, such as the leading edge of a blade, can assist in delaying or mitigating the initiation of fatigue cracks where erosion damage is present and presumably unavoidable.

By increasing the effective depth of compressive residual stresses at these locations, tolerance to damage can be improved. In such cases, deeper-reaching engineered residual stress may be required as the allowable material loss increases. However, conventional shot peening alone may be insufficient, and deeper compressive layers may need to be introduced via LSP or UIT.

Creep is the tendency of a solid material to move slowly or deform permanently under the influence of persistent mechanical stresses. This process can be accelerated with increasing temperature. Over time, creep may result in a fracture via creep rupture.

High engineered compressive residual stresses ahead of crack tips delay creep crack initiation and increase creep initiation life. Conversely, high tensile residual stresses due to unmanaged fabrication processes can promote creep crack initiation and decrease the time to crack initiation.

Residual stresses have little or no effect on creep crack growth rates. Therefore, surface and near-surface residual stresses are the most critical when engineered residual stresses are introduced to prevent or delay their initiation.

Since deeper-reaching compressive stress processes, such as LSP or UIT do not impart the highest compressive residual stress at the surface, a double-peening process may be desired for two reasons.

It provides the maximum compressive stresses at and near the surface, as well as providing deeper-reaching compression. Double-peening treatments can be optimized and their effects maximized by measuring residual stress post processes.

Once optimal engineered residual stress fields have been established and formally defined, they can be monitored and audited over time to confirm that components have been correctly processed by a given supplier.

The selected methodology of measurement must be accurate, quantitative and suitable for surface, near-surface and subsurface residual stresses to account for both crack initiation and propagation considerations in life modeling and analysis.

James Pineault is Lab Manager at Proto Manufacturing in Oldcastle, Ontario, a company specializing in XRD equipment and measurement services. For more information call +1 519-737-6330 or visit protoXRD.com.

Engineered residual stresses can be used to lessen turbomachinery failures

 alignment is the process of aligning two or more shafts to within a tolerated margin. It is a critical requirement for turbomachinery trains before they are put in service.

Shafts are in alignment when they are colinear at the coupling point, i.e., the rotational centerlines of two mating shafts are parallel and intersect. In other words, they join to form one line.

When this is the case, the coupled shafts theoretically operate like a solid shaft. Any deviation from the aligned or colinear condition results in abnormal wear of turbomachinery components, such as bearings, shaft seals and the shafts. Proper alignment reduces power consumption, vibration and noise, as well as helping to achieve the intended life of turbomachinery and its components.

The goal of alignment procedures is to obtain a common axis of rotation during operation for two coupled shafts. This is particularly important for high-speed, high-power units. Although some flexible couplings might allow for a tiny amount of misalignment, correct alignment remains critical for shafts with flexible coupling.

Shaft alignment can change due to factors, such as operational variation and thermal movement. These can cause movements of components, rotor assemblies and shafts, leading to misalignment.

It is important for final turbomachinery train alignment to compensate for actual operating conditions as machinery often moves after start-up as the result of wear, thermal differences, dynamic loads, and support or structural shifts. These factors should be considered and compensated for during the alignment process.

Tools used to achieve alignment may be mechanical, optical (laser shaft alignment) or gyroscope-based. Before shaft alignment, the foundation should be checked and verified.

Alignment is usually accomplished through corrections, such as shimming or moving a component. Both angular and offset alignment should be performed in two planes.

This is accomplished by moving other components to align the shaft(s) with the rotational centerline. Too often, alignment operations are performed randomly, and adjustments are made by trial and error, resulting in a time-consuming procedure.

"The use of alignment tools and procedures that take thermal movements into account is a mandatory requirement for turbomachinery operating at extreme temperatures."

Since shafts exist in three-dimensional space, misalignment can occur in any direction. It is best to break three-dimensional space into vertical and horizontal planes and to describe the specific amount of offset and angularity in each plane simultaneously at the location of the connection or coupling.

Thus, there are four specific values of misalignment needed to accurately express alignment, two offsets and two angularities. A traditional single limit of perhaps 50 microns is a simplified expression of misalignment used for ordinary machinery and basic alignment exercises. For a thorough investigation, all four components should be considered and verified.

The conditions of misalignment should be described at the location of the coupling: it is at the shaft connection that harmful machinery vibration and forces are created whenever misalignment exists. The magnitude of a misalignment tolerance or the desired alignment quality should be expressed in terms of these offsets and angularities or any other suitable 3D method.

Additionally, the size, geometry or operating temperature of turbomachinery should be considered in its alignment. Vibration and the resulting efficiency loss due to misalignment of shaft centers depends on shaft speed and the details of the coupling or type of connection.

Note that bearing load increases with misalignment. As a rough indication, bearing life decreases as the cube of the load increase, i.e., doubling the load will shorten bearing life by a factor of eight.

Do not forget to take into account thermal movement as a factor in alignment. Aligning center-to-center without paying attention to thermal movement can often lead to misalignment during operation and consequent failures.

The use of alignment tools and procedures that take thermal movements into account is a mandatory requirement for turbomachinery operating at extreme temperatures, whether cold (cryogenic machinery) or hot.

Different criteria have been used related to alignment and allowable misalignment. As a rough indication, limits between 40 and 55 microns have been specified and used. ■

Shaft alignment and its effects on turbomachinery

Engineers have a tendency to overdesign and oversize rotating equipment. In past 

, we discussed the impact of unnecessary oversizing for compressors and gas turbines. But in terms of performance and cost, the 

 (ST) is most impacted by unnecessary oversizing.

For those not familiar with STs: Steam generated in a boiler enters the turbine at an inlet and chest area and flows through parallel governor valves. The flow is distributed by a flow ring, allowing for partial admission before it enters the control stage.

Subsequently, steam flows through several impulse or reaction stages to extract energy efficiently and leaves through a back-end stage. All of these stages consist of stationary and rotating blades. STs can have side streams. Their discharge pressure can be a defined backpressure or the pressure at the steam condensation temperature.

STs designed for API 612 applications must provide 10% margin above the rated driven equipment power with the lowest possible steam demand. This, as well as the desire to build in safety and degradation margins, often leads to oversizing.

It also reduces the efficiency at normal operating points. An ST driving a compressor must be able to produce at least 110% of the rated power at steam conditions coincident with the minimum inlet, and maximum exhaust temperature and the pressure conditions specified.

An example: The boiler could be dropping off, and the main condenser losing vacuum while the plant process is still trying to maintain 110% of the compressor-rated condition at rated speed. What does this mean for the various components and their sizing?

To meet design velocity limits entering the ST, all operating points must be considered, including the rated power at worst case conditions. This maximum flow case coincides with the minimum inlet condition, which has a higher specific volume, resulting in the need for a larger inlet flange and steam chest area to pass the flow at or below inlet velocity limits. This increase in volume area raises the internal surface area, which produces larger hoop stresses, requiring increased wall thickness and other structural design challenges.

When designing the governor valve opening scheme for a multi-valve ST, it is preferable for the normal operating point (or guarantee point) to be on a valve point to reduce throttling losses.

The valve point is when the valve is almost completely open and immediately before the next valve is about to crack or lift from the valve seat. To meet the rated operating point, the governor valve opening schematic must be modified to ensure all valves can pass the required rated flow at minimum conditions to make the turbine-rated power. This change in opening creates a throttling condition for the normal operating points, reducing the ST’s front-end efficiency.

To mitigate governor valve throttling losses at normal operating points, flow distribution must be improved by manipulating the area in the nozzle ring to provide a distribution favoring a valve point.

This is accomplished by increasing the nozzle height, thereby forcing a lower arc of admission. Additionally, the throat opening can be increased, which moves the velocity triangles away from optimum design and often requires adjusting blade angles.

In both cases, this creates a larger pressure ratio on the control stage and an increase in active arc losses for normal operating points. The larger pressure ratio produces higher dynamic blade stresses from nozzle wakes and partial admission stimulus when entering and exiting the active arc. This requires more robust staging that reduces operating efficiency.

A large change in flow rate can have an impact on the volume flow area needed in the condensing section of the LP staging. Since the ST starts with the lowest available inlet steam conditions, this reduces the energy that can be extracted by increasing the exhaust pressure.

Thus, the flow required to make rated power becomes substantially larger. Meeting the required flow rate requires changes to the design of the back-end stages. For example, the last stage will either need to be gauged open or its height increased.

But either option negatively impacts efficiency. A taller blade height also increases centrifugal and bending stresses. Alternatively, gauging open the nozzle and bucket passages reduces stage efficiency.

The impact of these parameters varies based on the type of machine, the power balance and operating conditions. Oversizing is different for straight-through condensing, back-pressure, or extraction- and induction-type turbines. Straight-through turbines are impacted across all design conditions, which can result in flow requirements up to 60% above the guarantee condition.

For an extraction turbine, impact splits performance losses in each section. Extraction/induction machines can see front-end flow oversizing requirements from 10% to 30%, and back-end flow oversizing from 30% to 50%. Clearly, this negatively impacts efficiency. A performance drop of more than 5% is not uncommon.

It is sometimes appropriate to conservatively oversize power margin per API requirements and account for future degradation. But oversizing an ST usually results in an exponential increase in hardware costs and a significant reduction in design performance efficiency. (Adam Neil of Elliott Group significantly contributed to this article). ■

Myth: Going bigger with steam turbines

Just as we were about to hear some better news about the gas turbine market at the Western Turbine Users Conference, the world was turned on its head by the Covid-19 inspired shutdown. In parallel, a price war erupted between Organization of Petroleum Exporting Countries (OPEC+) members Saudi Arabia and Russia resulting in a precipitous crash in the price of oil.

No one knows yet the extent that these events will impact orders and revenue. What is becoming clearer, though, is the that various parts of the turbomachinery landscape will probably be affected in different ways. Orders for some small gas turbines are likely to rebound faster, such as the GE LM2500 and its variants, as well as various models within the Solar Turbines portfolio. At the high end of the market, orders for advanced class machines may not languish for too long. GE, Siemens and Mitsubishi will continue to fight for orders in this category. However, many mid-sized machines may struggle unless new markets open up.

The best opportunities for turbomachinery business appear to be in LNG, pipelines, flaring, methane reduction, and especially aftermarket and maintenance.

 The number of units installed among the various aeroderivative fleets showing the extent of LM2500 family dominance. Courtesy of Dora Partners & McCoy Power Reports.[/caption]

By all indications, it looked like the gas turbine market had finally begun a recovery in 2019. MW orders were up for the first time since 2015. Overall, though, we had seen a 39% drop in MW orders and a 65% slump in unit orders since 2012. Compared to 2018, last year saw a rebound of 23% in MW orders, but a decline of 18% in unit orders. Tony Brough of analyst firm Dora Partners assigns that jump mainly to coal retirements prompting coal-to-gas switching.

“Two disruptive global events will likely result in significant market turbulence to the gas turbine business,” said Tony Brough of analyst firm Dora Partners.

The first of these is friction between Russia and Saudi Arabia concerning a mutual oil production collaboration policy. This caused oversupply at a time of dramatic downturn in demand, driving the price of oil to an 18-year low of close to $20 per barrel.

The global coronavirus pandemic then induced a major reduction in consumer demand, as well as temporary business closures to comply with mandatory social distancing. Both events are exerting an adverse impact on global GDP.

Dora Partners, therefore, predicts that new gas turbine orders will experience a big reduction primarily due to delayed project execution. The amount of the drop remains to be seen. Analysts forecast a downturn in aftermarket products and services, but demand from unplanned maintenance may help.

“Historically, cash conscious business leaders restrict maintenance spending when major market turbulence occurs,” said Brough. “But there will be some spot increases in maintenance activity, primarily due to opportunity taking of underutilized equipment during the current market turbulence.”

Dora Partners estimates a fall in unit orders as high as 70% this year in oil & gas and 50% in the electric power generation sector compared to what was expected. Project delays, deferments and cancellations will add up over the year.

Although it is hard to predict the length of time needed for recovery, Brough guesses the power sector will take two years to rebound and oil & gas will take three years.

 Aeroderivative orders in 2019 for North America. Courtesy of Dora Partners & McCoy Power Reports.[/caption]

For the purposes of this article, we are defining small as being less than 40 MW. It includes a large number of aeroderivative models including the LM2500. This sector has been doing relatively well.

“The small turbine market has remained steady mainly due to orders from the oil & gas segment, not utility power generation,” said Mark Axford, Principal at Axford Turbine Consultants.

The LM2500 and its variants comprise by far the largest aeroderivative fleet in existence. Over the past five years, they account for 38% of all aeroderivative units ordered, according to Dora Partners. This machine is favored for oil and gas mechanical drive applications over other units due to its reliability, and the availability of trained personnel and aftermarket providers servicing these models, added Brough.

“There has been steady and robust demand for the GE LM2500 and LM2500+ primarily for compressor drive and LNG plants,” said Axford.

This is helping to maintain GE’s dominance in the aero market although its share slipped from 66% of all aeroderivative units in 2018 to 47.6% in 2019. Part of the reason for the drop from GE was a hefty order book for Russian firm UEC which has a virtual monopoly on the burgeoning Russian commonwealth pipeline business. UEC captured 40% of aero unit orders in 2019, though Dora Partners does not expect this number to be sustained as the number was inflated by unusually large pipeline orders.

Siemens comes next with an 11.3% share. It offers a wide range of aeroderivatives including the SGT-AO5AE, SGT-A25RB, SGT-A30RB, SGT-A35RB, and the SGT-A45TR. These are primarily destined for oil & gas sites.

Rounding out the aeroderivative market is PWPS with 3.2% share, down from 4.5% in 2018. The FT8 (30 MW) has been the company’s top seller over the past five years, though PWPS have made inroads into the 40 MW to 70 MW segment with the FT4000.

When industrial gas turbines are included, Solar Turbines sells the most small units overall. Axford said the Solar Taurus family in the 5 MW to 7 MW range is doing well. Along with the LM2500 family, they are favored by the oil and gas industry. But the recent crash in oil prices means capital budgets for 2020 are being pared back and new projects delayed. This will reduce GT orders during 2020 in this segment.

The 40 MW to 100 MW segment is currently dominated by the Siemens SGT-800, according to Dora Partners.

“The SGT-800 is an efficient (almost aeroderivative-like) unit, with excellent dry low emissions capability on both gas and liquid fuel,” said Brough. “That unit is taking market share from aeroderivatives and is also well accepted for cogeneration use.”

He believes this turbine category is likely to begin to win orders for renewable offset i.e. as the total MW capacity on the grid gains more renewable sources, the variability of available MW-hours rises. Something has to fill the gap when renewables are not producing and power is in demand. Over the last 10 years, that gap filler has mainly been turned-down coal plants and non-baseload large industrial gas turbines (E- and F-class gas turbines). But coal plant retirements are speeding up, large industrial gas turbines are increasingly moving toward baseload, and renewables keep coming online.

“The need for new, more flexible supply is going to increase, and aeroderivatives are an ideal solution,” said Brough. “But now it may be 2021 or 2022 before we see it.”

The LM6000, however, appears to be struggling. It captured only 6.5% of aeroderivative market share over the past five years. While it consists of an impressive fleet of more than 1,100 units, it is no longer gaining many sales. Axford predicts additional pressure on mid-sized gas turbines due to accelerated industry adoption of battery storage during 2019.

“The installed cost per MWH of battery storage continues to fall,” he said. “I am pessimistic about the future of the GT market for simple cycle peaking and balancing power as a greater fraction of this need is likely to be fulfilled by battery storage.”

He conceded, however, that smaller combined cycles will be a better match for the grid in some international markets than the typical 500 MW to 1000 MW combined cycle power plant (CCPP) that accounts for the majority of MW orders these days. Axford believes that smaller CCPPs plants will probably be built using 40 MW to 60 MW gas turbines. But he sees a bleak future for GTs with older technology in the 60 MW to 180 MW range. Most future orders for such machines, therefore, are likely to be for replacement units at existing plants rather than new power plants based on E-class and F-class technology.

 Aeroderivative orders in 2019 from outside of North America. Courtesy of Dora Partners & McCoy Power Reports.[/caption]

2019 appeared to mark a turning a point in terms of increased MW orders after three consecutive down years. But 2020 is now unlikely to continue this trend. The various OEMs have been jockeying for dominance in various parts of the market. GE has historically been number one in MW orders but in 2018, MHPS moved ahead in the large gas turbine space (over 200 MW).

Axford said GE reasserted its top dog status in 2019 due to orders for its HA series GTs. “GE regained a clear position the top gas turbine provider worldwide in 2019,” said Axford. “Market worries about technical problems relating to GE HA class machines seems to have been rectified.”

Axford believes GE, Siemens Gas & Power and Mitsubishi now have comparable advanced GTs in the 250 MW to 400 MW range. Therefore, business will be won by the seller with the best combination of installed cost, guaranteed efficiency and long-term cost of maintenance. Not surprisingly, all three OEMs push hard to bundle long-term maintenance contracts with the initial equipment sale.

There is no escaping the fact new gas turbine orders are going to have a difficult year. The most dramatic reduction is likely to be in unit orders. though MW will take a significant hit, too.

But with every problem comes opportunity. Let’s review some of the opportunities that may be out there.

Maintenance: Large capital expenditures may be put on hold. But maintenance spending is likely to soften the blow. This will manifest in several ways. Actions previously put off due to production necessity are likely to be scheduled now that demand has softened. And with some orders postponed for new turbomachinery, plants will have no choice but to attempt to gain more life out of existing units. That adds up to more focus on maintenance, upgrade requests and component replacements.

“A downturn in aftermarket products and services will be dampened by unplanned/urgent maintenance of equipment,” said Brough. “Historically, cash conscious business leaders restrict maintenance spending when major market turbulence occurs. There will be some ‘spot’ increases in maintenance activity, primarily due to ‘opportunity taking’ of underutilized equipment during the current market turbulence.”

LNG: As covered in our March/April cover story, LNG has been a primary source of good news of late. This market may take a hit, but the difficult part has largely been accomplished – the establishment of the necessary infrastructure in terms of liquefaction trains, terminals and transportation. LNG may struggle somewhat but its rebound is likely to be rapid. There will likely still be plenty of business for anyone building, supplying, maintaining or servicing LNG facilities.

“The delivered price of LNG has fallen substantially as numerous LNG export terminals have come online,” said Axford. “This means LNG will be a more affordable fuel both near term and long term. This will be especially important in countries that do not have an indigenous supply of natural gas or pipeline infrastructure. The growing supply of affordable LNG is good news for all sizes of gas turbines.”

Pipelines: Axford and Brough noted that one of the strong areas for gas turbine sales is pipeline compression. This trend is expected to continue. Pipeline construction may slow, but will ultimately continue.

Flaring: Environmental groups are hounding oil & gas drillers to eliminate flaring of excess gas. Anyone coming up with an easy way to transform flaring into on-site power generation has a large potential market. The sizing and pricing have to be right, and units probably need to be easily transportable. But there is a worldwide need to curtail the practice of flaring.

Methane reduction: Flaring and venting of natural gas are just one facet of the methane emission challenge. Pipelines, valves and other components suffer from methane leakage. Solutions that address these problems will find demand as oil & gas companies are under pressure to greatly reduce methane emissions. ■

The bad and good news in the gas turbine market

 Source: SMB Group’s The Impact of Covid-19 on SMBs Study, 2020[/caption]

Beyond sectors such as Liquefied Natural Gas (

) and pipeline compression, the gas turbine marketplace has not been thriving of late. But everything turned on its head in the first quarter of 2020 due to two factors:

• A precipitous crash in the price of oil.

Government officials around the world brought business to a halt in an attempt to slow the spread of the virus. While most turbomachinery companies and suppliers continued to operate, they faced postponement or cancellation of orders, and severe financial strain.

In tandem with the pandemic, oil producers jostled over output quotas. The resulting supply glut sent oil prices southward toward $20 a barrel.

A downturn, therefore, is inevitable. Casualties are likely, especially among the ranks of the many small business suppliers, service companies and specialists that support the industry. It is also possible that a few mergers and acquisitions may be in the cards among the larger players. That often happens after a downturn.

Experts, analysts, supply chain managers and OEMs including 

 are responding to the crisis in various ways.

"We’re in for a rough patch but turbomachinery technology isn’t going anywhere,” said Valentine Moroz, SoftInWay. “The turbomachinery industry is well positioned to weather this storm as it is a critical part of our everyday lives.”

There is no escaping some of the immediate repercussions of recent events. A 

 of business leaders in the U.S. by business consultancy PwC revealed that 67% are considering the deferment or cancellation of planned investments. Some 2% are looking to make cuts in cybersecurity and privacy budget. Another 53% plan to reduce spending on IT, and 25% may scale back digitalization programs.

Chief Financial Officers (CFOs) are particularly worried about cash liquidity and a potential global recession. The good news is that 61% of CFOs think they can return to business as usual within three months, according to PwC.

18% consider it more likely to take six months. But due to fear that 2020 revenues will be lower than expected, 81% are engaged in wide-ranging cost reduction measures. 26% have laid off or are planning to lay off workers, and 44% have furloughed workers or anticipate doing so.

Half are hesitant about attempting mergers at this time, but the other half intend to forge ahead with ongoing plans. It largely boils down to cash availability. Those that have money in the bank see the potential for aggressive action as the going rate is falling for potential acquisition targets in power and oil & gas. Almost 40% of respondents plan to engage in supply chain reorganization, which includes a heavier reliance on local sourcing.

 found 75% of companies are already reporting some kind of supply-chain disruption due to the coronavirus. Some 938 of Fortune 1,000 companies said they have a tier 1 or tier 2 supplier that has been affected. 44% of companies surveyed admitted to not having a plan to deal with the disruption.

Some predictions place the global economic damage from recent events at $2.7 trillion. Others have speculated that it will rise as high as $12 trillion.

The oil & gas sector has an even more challenging situation due to the crude oil price per barrel hovering around $20 to $25. Such lows have not been approached since late 2001. That has placed a squeeze on the U.S. shale industry. Small drillers are struggling. Production is being ramped back. The boom days are over in some regions.

“Businesses of all sizes are feeling the pain of the pandemic,” said Laurie McCabe, an IT and business analyst at SMB group.

Her survey of organizations of 2,500 employees or less, highlighted that 75% of businesses are negatively affected by the crisis. Among those, however, smaller companies have generally been hit the hardest. Those with fewer than 20 employees are most likely to experience extreme hardship.

“Many of these companies lack the cash flow and capital necessary to see them through an extended period of reduced or no sales,” said McCabe. “38% of companies with 1 to 19 employees report that Covid-19 is having an extremely negative impact on their businesses.”

More than half of small and mid-sized businesses (SMBs) have already or are planning to lay off salaried employees, or reduce their hours. Worried about preserving capital, they are slashing spending on non-employee goods and services by an average of 37%.

This is a big problem for the business world in general, and in particular for power generation and oil & gas. These small businesses supply many of the goods and services that larger players rely on.

SMB Group said that Covid-19 is negatively impacting business in 75% of SMBs. 19% have not experienced a negative effect to date, and 6% are not sure. Close to two thirds believe revenues will drop by 30% or more over the next six months.

While all industries have been afflicted, the depth of impact varies by industry. Personal services, hospitality and manufacturing are taking the biggest hits, with 90% or more of businesses in these sectors reporting a negative impact, said McCabe.

 Crude oil price trends since the late eighties.[/caption]

Oil & gas is especially badly affected. The recent OPEC+ 

 to cut production by 9.7 million barrels per day (mainly from Russia and Saudi Arabia) has done little to arrest the decline of oil prices.

This is having a ripple effect across operations. Industry giants such as Schlumberger and Halliburton have announced furloughs, salary reductions and job cuts.

Refineries are coping with a supply glut at very low prices coupled with far lower demand from the transportation sector. Analyst firm ICIS said 26% of the Europe’s ethylene production capacity is threatened by oil refineries running at reduced rates or ceasing production entirely.

Ethylene is produced by crackers attached to refineries. But the collapse of demand for petroleum products, such as jet fuel and gasoline means some ethylene crackers may be closed as they rely mainly on naphtha or liquefied petroleum gas (LPG) feedstocks. That could add up to the loss of 6.6 million tonnes (m.t.) per year of ethylene, 5.9 million m.t./year of propylene and 4.0 million m.t./year of benzene.

Some refineries have scheduled stoppages due to reduced fuel demand from Coronavirus and associated lockdowns. As a result, European refineries are producing about 10 million barrels/day right now, which is down about 2.2 million per day compared to the expected throughput according to ICIS.

“The reduction is almost certainly even higher in reality and could be as high as 5 million per day when considering those sites which do not share such information,” said Michael Connolly, Senior Consultant at ICIS.

Case in point: Around 40% of Total’s refining and petrochemical operations are in France, the U.S., Germany and South Korea. In addition, over 70% of the company’s petrochemical plant capacity is based in South Korea, the U.S. and France. Its exposure in Covid-19 affected countries makes it susceptible to a fall in capacity utilization over the near term, said data and analytics company 

“Total has postponed the restart of the Grandpuits refinery in France, which was shut down earlier for scheduled maintenance, due to lack of demand,” said Ravindra Puranik, Oil & Gas Analyst at GlobalData. “The company has also cut production at the Leuna refinery in Germany by around 25%.”

However, Total’s LNG liquefaction operations look to be less vulnerable to disruption. Similarly, its major exploration and production projects in the Middle East, Norway and Nigeria should not be unduly affected.

Small oil & gas firms may find it tougher to weather the storm. The shale boom would never have happened were it not for hundreds of small companies exploring and drilling for relatively small shale oil deposits.

Such work was not financially attractive enough for the oil majors to carry out. Yet the entire industry depended upon the work of these tiny operators. Unfortunately, there has been a severe drop in general shale activity as shown in rig count. More than a few are filing for bankruptcy, or have had to curtail drilling.

Pioneer Energy Services is one casualty. After 20 years of operation in the Bakken shale basin, it has ceased drilling there. A plunge in oil prices and the bankruptcy of a major customer in the region meant the closure of its six rigs in the Bakken.

Adding it up across the oilfield services sector, more than 50,000 jobs have been lost since the start of 2019. That equates to nearly 13% of the workforce. Fracking is probably going to face its worst year. Citigroup forecasts that at least half of all fracking work will end by late June 2020 due to lack of viability.

As well as greatly reducing drilling locations, producers are cutting costs by avoiding capital expenditure and even maintenance. Instead of repairing or replacing a faulty pump, for example, some companies are discarding the broken pump and grabbing an old one from an inactive site in an effort to minimize spending.

In the power sector, small service shops are the backbone of the industry. These firms are typically composed of industry veterans with decades of highly specialized technical know-how. They are experts in areas such as rotor balancing, outage management, rotor replacement, filtration, maintenance, inspection, emergency repairs, coatings, water washing, chemical treatment, gearing and many other skills. Every one that disappears is a major loss.

Institutional knowledge, after all, is the backbone of any industry. The Clint Eastwood movie, “Space Cowboys,” gives a fine example of the importance of preserving knowledge, even of very old systems. In that film, retired NASA engineers are called back into action as they are the only ones with the know-how to repair an old Soviet satellite that is in danger of crashing. Similarly, the ability to support aging turbomachinery hardware and software must be preserved.

Consider turbomachinery controls. Controls vendors are generally most interested in selling, updating and servicing their latest software and controls. They may continue to service models dating back a generation or two. But after that, they sometimes withdraw support.

Parts become difficult to obtain and maintenance becomes a challenge. Several small suppliers make a living serving the needs of facilities that continue to use aging controls. The individuals that make up these businesses were often those who helped develop these controls – or spent decades at large organizations servicing such systems.

But it is not just small firms. Midsized and large suppliers in most regions are also noticing repercussions. The German association for the mechanical engineering industry (

) asked almost 1,000 member companies about current operations. Supply chain disruptions are particularly prevalent in Italy (75%), Germany (55%), China (51), France (36%) and the U.S. (25%).

“The situation in China and South Korea seems to be easing slightly,” said VDMA chief economist Ralph Wiechers. “In addition, many mechanical engineering companies report a significant increase in orders from Chinese customers.”

But the fallout among German engineering firms is rising. In a two-week period in April, the number noting supply chain disruptions rose from 60% to 84%. Almost half said this amounted to serious disruption.

Across the board, turbomachinery vendors have taken seriously the restrictions imposed by government authorities. They have been cleaning and sanitizing their facilities rigorously, and going to great lengths to protect their workers, their suppliers and their customers.

MAN Energy Solutions has not witnessed any major decline in orders for turbomachinery so far. However, Mathias Scherer André, Head of Sales & Execution Turbomachinery, understands that it would be naïve to believe that the Covid-19 crisis will not affect business.

“Some turbomachinery customers are already reducing their aftersales expenditures on maintenance or overhaul activities,” he said. “The current situation and the uncertainty about the future could also dampen appetite for new projects and subsequently weaken the turbomachinery market.”

As a result, the company anticipates a business reduction compared to 2019, especially in the second half of the year. The decline in the downstream oil & gas, and the industrial segment is expected to be smaller than in the oil & gas upstream and midstream segment.

“I don’t think we will see a significant decline in the power generation market,” said André. “I remain optimistic about the turbomachinery business outlook for 2020 and beyond.”

MAN’s turbomachinery factories are producing at normal capacity, except in India. Remote customer interaction has been made easier by earlier steps taken by the company in digitalization.

Its remote support tool PrimeServ EyeTech is an assisted-reality application. It allows mobile video conferences to be set up via data glasses, or other video-capable terminal equipment like smartphones or laptops.

Technical experts in the MAN Remote Operation Centers or from their home offices can take the customer perspective without having to be on site. This has enabled the company to conduct remote audits, factory acceptance tests, assist remotely with repairs and commissioning.

In addition, MAN is continuing a strategy to regionalize and decentralize its turbomachinery operations. “Being present in our main markets, close to our customers, has proven to be a valuable asset and key to support our customers when no international travel is possible,” said André.

May/June 2020

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