Last week, three reciprocating engine original equipment manufacturers (OEMs) reported third-quarter earnings, ending the period with record reciprocating engine backlogs. INIO, CAT and WRT1V each reported all-time-high order books in late October, with INIO’s equipment backlog rising 142% year over year to $8 billion. By comparison, GEV added a net 6 GW of gas turbines under contract in the third quarter, a slight cooldown from the double-digit quarterly growth recorded earlier in the year.
GEV’s order slowdown could reflect a shift in customer orders toward modular technologies offering a quicker path to power. As utilities and grid operators face record load interconnection requests and longer delays, data centers and other industrial facilities are generating their own power behind the meter (BTM) using technologies such as reciprocating engines to bypass grid constraints and accelerate deployment.
For BTM projects, speed can be a deciding factor in technology selection. Enverus Intelligence® Research (EIR) estimates the majority of gas-fired BTM capacity added through 2030 will come from modular technologies such as reciprocating engines, small- and medium-frame turbines and fuel cells, which offer a time-to-power edge over large-frame gas turbines. Lead times for large-frame gas turbines have stretched beyond five years, and a large-frame combined-cycle project can take up to 80 months from order date to commercial operation. By comparison, reciprocating engines can come online within 24 months of an order.
That speed advantage is showing up in OEM order books. As developers race to bring power online, record reciprocating engine backlogs and slowing contract growth for large-frame turbines signal that developers are increasingly prioritizing quicker paths to power.
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DID YOU KNOW?
The 14-cylinder Wärtsilä-Sulzer RTA96C, the world’s largest reciprocating engine, weighs over 2,300 tonnes and stands four stories tall. Its 300-tonne crankshaft rotates at just 102 rpm, yet the two-stroke turbocharged diesel engine produces about 80,000 kW, enough to propel the largest container ships.
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Top Three Takeaways:
1: How much data center load is expected to be served by behind-the-meter generation?
Enverus Intelligence® Research (EIR) estimates the majority of gas-fired BTM capacity added through 2030 will come from modular technologies such as reciprocating engines, small- and medium-frame turbines and fuel cells. These technologies offer a time-to-power edge over large-frame gas turbines.
2: Why are developers favoring reciprocating engines over large-frame gas turbines?
Lead times for large-frame gas turbines have stretched beyond five years, and a large-frame combined-cycle project can take up to 80 months from order date to commercial operation. Reciprocating engines can come online within 24 months of an order.
3: What do record reciprocating engine backlogs signal about the market?
Record reciprocating engine backlogs and slowing contract growth for large-frame turbines signal that developers are increasingly prioritizing quicker paths to power. INIO’s equipment backlog rose 142% year over year to $8 billion.
About Enverus Intelligence® | Research, Inc. (EIR)
Enverus Intelligence® | Research, Inc. (EIR) is a subsidiary of Enverus that publishes energy-sector research focused on the oil, natural gas, power and renewable industries. EIR publishes reports including asset and company valuations, resource assessments, technical evaluations, and macroeconomic forecasts and helps make intelligent connections for energy industry participants, service companies, and capital providers worldwide. See additional disclosures here.