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Cost of new Gas-Fired Power Plants in US Surges 66% Amid Demand Surge, Says BloombergNEF

-- The cost of building a new gas-fired power plant in the US rose by almost two-thirds from 2023 to 2025, BloombergNEF reported on Thursday, presenting a snag for developers proposing to build more plants of this type as power demand grows.

The price per kilowatt of capacity at a combined-cycle gas turbine-equipped plant rose to $2,157 up from less than $1,500 in 2023, BloombergNEF said.

The figures do not come as much of a surprise given reports in recent months of long waits for deliveries of gas turbines, with manufacturing capacity stretched by an influx of new orders.

BloombergNEF said the trend threatens climate goals given gas plants are often intended to replace doubly carbon intensive coal. It is also generating a scramble for skilled labor and pushing up share prices in companies that own gas plants and manufacture turbines such as General Electric.

It has also pushed some of the world's biggest tech companies to pay premiums to ensure a power supply for energy-hungry data centers, the article said.

BloombergNEF said the time to bring a new gas-fired power plant into operation has also lengthened 23% in the 2023-2025 period, based on an analysis of utilities filings.

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Cost of new Gas-Fired Power Plants in US Surges 66% Amid Demand Surge, Says BloombergNEF | FINWIRES