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China Closes the Clean-Coal Gap

The United States and China are both focusing on technologies to clean up coal power.
December 17, 2008

China looks set to overtake the United States in the application of technologies to clean up coal-fired power generation, if several proposed projects come to fruition. GreenGen–a joint venture established by Chinese utilities–has broken ground on China’s first integrated gasification combined cycle (IGCC) plant and signed agreements to build two more.

Future power: An artist’s concept of China’s first integrated gasification combined cycle (IGCC) plant, which is being constructed in LinGang Industrial Park in the Tianjin Binhai New Development Zone.

At the same time IGCC is stalled in the US. In February, the U.S. Department of Energy (DOE) canceled an advanced IGCC technology demonstration project called FutureGen, and climate concerns have paralyzed all but one of 30-plus IGCC projects proposed by U.S. utilities since 2000.

GreenGen is now the most advanced project of its kind in the world, according to Ming Sung, Beijing-based Asia/Pacific representative for the Clean Air Task Force, a nonprofit environmental consulting firm based in Boston. “They are ahead because they have completed engineering [and] design, major equipment is selected and on order, and site preparation and foundation [work] has begun,” says Ming.

The oil and gas giant BP reinforced China’s position as a clean-coal technology leader last month, by establishing a $73 million research center in Shanghai with the Chinese Academy of Sciences to help commercialize technologies such as carbon capture and storage (CCS) and gasification. In another sign of the country’s suddenly bold role in green technology, China’s battery giant BYD launched the world’s first mass-produced plug-in hybrid vehicle yesterday.

Underpinning China’s potential leadership in carbon-neutral coal power is broad expertise with gasification. By 2010, China will have installed 29 gasification projects since 2004, compared with zero in the United States, according to the Gasification Technologies Council, a trade group based in Arlington, VA. Most of these Chinese projects turn coal into synthesis gas (or syngas)–a blend of carbon monoxide and hydrogen–to feed catalysts that synthesize chemicals and fuels. IGCC technology uses the same syngas to drive turbines and generate electricity with far less pollution than conventional coal plants. For example, mercury and soot levels are close to those seen at natural gas-fired plants, while carbon dioxide comes out in a pure stream that should be easier to capture and sequester.

Until recently, Chinese power firms ignored IGCC technology because conventional coal plants are cheaper to build and operate. But Guodong Sun, a technology policy expert at New York’s Stony Brook University, says that GreenGen and a few other IGCC projects are gathering momentum thanks to a blend of government incentives, tighter environmental regulation, and emerging concern for corporate self-image among China’s leading power producers. Sun says that GreenGen, for example, is important to the national government as a symbol of homegrown Chinese technology.

The project plans to start up a 250-megawatt IGCC plant in Tianjin in 2010 using a novel gasifier designed by the Thermal Power Research Institute in Xi’an; the plant will also supply some syngas and heat to local chemical plants. GreenGen plans to catapult the output of the gasifier design, from a 36-tons-per-day pilot plant, directly to commercial scale of 2,000 tons per day.

And GreenGen is already preparing to scale up further: in April, GreenGen and Tianjin officials signed an agreement for two 400-megawatt IGCC units. Meanwhile, Chinese utility firm Huaneng, GreenGen’s majority stakeholder, started up a CCS pilot project at its Beijing coal power plant this summer.

While municipal air-quality concerns support GreenGen’s plans, Sun says that they are central to another IGCC project that he believes will be built: a 200-megawatt IGCC plant in Hangzhou proposed by Chinese utility company Huadian Power International. “For the Huadian project, the most important factor is sulfur dioxide and acid-rain regulations,” says Sun. “SO2 emissions are capped in Hangzhou, and … IGCC is an excellent solution.”

Both GreenGen and the Huadian project receive a small amount of financial support from China’s Ministry of Science and Technology, which Sun says carries important prestige for the utilities involved: “These government grants recognize their technology leadership, and mean much more [than cash] to Chinese companies.”

Ming of the Clean Air Task Force explains how the utilities involved rationalize the investment in more expensive IGCC technology even with slim government funding. He says that, while China’s electricity sector is technically deregulated, the National Development and Reform Commission (NDRC) still has final say over the tariffs that new power plants will earn per megawatt-hour supplied. It can therefore adjust the tariffs to ensure a reasonable rate of return for projects that respond to local or national interests, enabling the utilities to experiment.

However, NDRC control also slow IGCC’s progress if political will weakens. Ming acknowledges that NDRC may be less willing to approve projects that impose higher costs on consumers, in light of the current economic crisis.

James Childress, executive director of the Gasification Technologies Council, argues that projects like GreenGen are largely political. “They are doing it to put a better face on what is mostly just a ‘Burn coal and don’t worry about it’ policy,” he says. “In the current economic climate, I can’t imagine there being a drive to do anything seriously on CO2.”

As for IGCC’s prospects in the United States, Duke Energy’s 630-megawatt IGCC project at Edwardsport, IN, is the only one going forward nationwide. This is because it provides a means of using Indiana’s high sulfur coal, which produces too much pollution to be used in conventional plants. All the other IGCC proposals are caught up in a moratorium on new coal power imposed by state environment and utility regulators wary of the climate change and the economic impact of carbon emissions.

Last year, for example, Tampa Electric postponed plans for a commercial IGCC unit in Florida adjacent to an already operating demonstration unit built with DOE support in the 1990s after the state announced a climate-change plan.

Right now, the coal and utility firms supporting the FutureGen project are looking to president-elect Obama to jumpstart their project and others; they reinforced their commitment to the project this week by purchasing a $6.5 million site for it in Illinois. Childress, however, expresses little hope for rapid action. “Wind, solar, biomass, and other renewables have a bigger seat at the table right now,” he says.

Childress predicts that coal gasification will eventually flourish in the United States, but as “stealth coal” rather than as IGCC. He says that utilities will use gasification technology to generate synthetic natural gas to keep gas plants running. “I call it stealth coal because one way or another, we’re going to need more gas,” he says. “If you can’t put coal into the front end of a plant making electricity, they’re going to put it into the front end of a plant making natural gas.”

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