2G Energy expands sales and service activities in North America
Germany-headed 2G Energy AG, one of the world's leading manufacturers of gas-fired combined heat and power (CHP) plants, is continuing its expansion in the North American market. In 2009, the company took its first steps on the North American market with a sales and service office; since 2012, it has also had its own production facility in St. Augustine, Florida. Now the company has opened new offices in Maryland, United States (US) and Ontario, Canada.
According to 2G Energy, the new offices aim to strengthen the market position and to provide customers and partners with increased accessibility to 2G’s CHP experts with market and product know-how. Long-time cogeneration experts with market and product know-how were recruited for each office.
North American spark-gap and CHP opportunities
With its decentralized focus in the sales, service and after-sales areas, 2G is targeting accelerated penetration of the North American cogeneration market now that it already successfully doubled order receipts in 2017 compared to 2016.
In addition to France and Japan, the North American market is currently one of the highest revenue foreign markets and one that in 2G’s view offers potential sales between EUR 40 and 60 million annually over the medium term.
There is currently particularly strong demand in North America for natural gas-fired CHP plants, as the spark gap, i.e. the difference between gas and electricity prices, is attractive in various regions of North America.
Gas production in the United States (US) has increased by 40 percent since 2007, and the gas price has dropped by two-thirds during the same period. According to a forecast from the “IHS Markit” institute, the US will be covering half of its electricity requirements with gas power plants by 2040.
The sales activities are also supported by the Bipartisan Budget Act of 2018 which provides for a 10 percent tax credit for CHP projects, as well as a bonus depreciation plan which allows 100 percent depreciation to be taken in the first year for capital expenditures, which includes investments in CHP plants.
In addition, more and more states (e.g. California, New York, Maryland) are recognizing that coupling power and heat makes it possible to reduce emissions and increase the security of supply and, in light of the increase in natural catastrophes, are creating funding programs in order to allow further increases in the profitability of an investment in a cogeneration plant.