The Northwest's Rush to Coal, Part 2

NW Energy Coalition

Background

Most current and proposed electricity-generating coal plants in the United States employ traditional technology involving the burning of pulverized coal. Besides relatively low-priced power, these plants generate tremendous amounts of health-threatening toxins and climate-changing carbon dioxide.

Controls can be installed to reduce many of these pollutants. However, even the most modern pulverized coal plants still produce thousands of tons per year of carbon monoxide (headaches, heart disease), sulfur dioxide (acid rain) and nitrogen oxides (smog). They use hundreds of millions of gallons of water and, critically, emit more CO2 per kilowatt-hour than any other kind of electricity generation.

Promoters of "clean coal" technology claim to have that problem licked. If toxins can be virtually eliminated and if additional global warming can be averted through capture and storage of CO2, they ask, why not use an abundant and primarily domestic resource to meet growing power needs?

Why not, indeed, asks the Bush administration, which has included another $2 billion for clean-coal technology development in the latest energy bill. Why not, indeed, wonder several respected environmental leaders, rightfully concerned about the devastating effects of traditional plants. And why not, indeed, urge developers who have recently proposed siting three clean coal plants in Idaho and Washington state.

But is clean coal really an appropriate resource choice for the Northwest? This issue of The Transformer examines the promise and current reality of clean coal technology, specifically integrated gasification combined cycle coal plants.

Part 2 in our series on Northwest utilities' rush to coal was researched and written by University of Michigan graduate student and NW Energy Coalition policy intern Bernie Fischlowitz-Roberts.

The Promise of Gasification

Billions of dollars in federal subsidies have been and continue to be sunk into developing "clean coal" alternatives to traditional pulverized coal-burning power plants. The clean-coal technology of the moment is integrated gasification combined cycle, or IGCC. While IGCC has great potential, it must clear a number of technical and economic hurdles.

Gasification technology dates to the 1890s; what's new is using coal as the fuel. In an IGCC plant, fuel and oxygen are injected into a gasifier, producing a relatively clean-burning synthetic gas ("syngas"). The syngas is scrubbed to remove particulates, mercury, sulfur and other pollutants, then burned in a gas turbine to produce electricity. In stage two, the heat generated by the gas turbine is used to create steam at high pressure, which powers a steam turbine to generate additional electricity.

Oil refineries and chemical manufacturing plants have been using petroleum coke (a byproduct of oil refining) to fuel gasification systems since 2001. No commercially developed coal-fired IGCC plant currently operates in the United States. Several have been proposed throughout the United States, though none has yet completed the permitting process.

The country does have two demonstration plants started with funds from the Department of Energy's Clean Coal Technology Program (CCTP): the 250-megawatt Wabash River Generating Station near Terre Haute, Ind., and the 262-MW Polk Power Station near Lakeland, Fla.

Preliminary data from the demonstration projects confirm IGCC proponents' expectations of drastically reduced emission levels of criteria pollutants -- such as sulfur dioxide, nitrogen oxides, particulates and carbon monoxide - compared to pulverized coal plants. A study by Science Applications International Corp. and the U.S. Department of Energy says these plants emit less than 3 percent of the sulfur dioxide of a pulverized coal plant, and feature particulate levels well below federal standards (1).

Because gasification increases fuel efficiency, IGCC plants emit about 20 percent less CO2 than pulverized coal plants, though still 20-30 percent more than a natural gas combined cycle plant (2). Compared to a conventional coal plant, a baseline IGCC plant - one not fitted to capture carbon emissions -- can reduce water use 40 to 70 percent and cut solid-waste volumes in half (3). Carbon separation and capture significantly increase water consumption (compared to the baseline IGCC plant) due to the steam process involved in converting the carbon monoxide to carbon dioxide in the syngas stream. In addition, the carbon capture process (selective regenerative sorbent technology) is very energy-intensive; it reduces the plant's thermal efficiency, causing more coal to be mined and burned.

Advanced technologies that would improve carbon-capture efficiency are still in the experimental phase. According to the Northwest Power and Conservation Council, a typical Northwest IGCC plant without carbon capture and separation would require approximately 20 percent less coal than a traditional pulverized coal plant to produce the same amount of power. Adding capture, however, would erase all but 3 percent of that gain (4).

Still, IGCC plants with the built-in ability to capture CO2 for potential future storage ("sequestration") will be valuable commodities when carbon emission constraints are enacted. An IGCC plant built with full carbon capture and separation technology can harvest 90-95 percent of the CO2. Obviously, it is far more efficient and cost-effective to build an IGCC plant with the intent of capturing the carbon than to retrofit it later. That said, adding carbon-capture equipment (a larger gasifier and steam reformation unit) to an IGCC plant will be easier and less expensive than so modifying a pulverized coal plant.

The Sequestration Conundrum

Sequestration refers to storing CO2 permanently rather than releasing it into the atmosphere. IGCC, as noted, could facilitate that process by simplifying carbon collection. However, it's one thing to declare a power plant technology carbon capture-ready, and quite another to expect every plant to effectively store all the CO2 it produces and captures over the 30 - 60-year operating life of a new power plant.

Some oil refineries and chemical plants that use IGCC technology are capturing the CO2 and piping it for injection into oil and natural gas fields to enhance recovery. A network of CO2 pipelines exists in Texas, the Southwest and Southern California to connect the oil refineries and chemical plants with well fields. The Pacific Northwest, however, has no oil industry to create a market for captured CO2.

Suitable storage sites for carbon dioxide collected at IGCC coal plants could include depleted oil and gas reservoirs, unmineable coal seams, salt domes, deep saline aquifers and ocean depths. But viable sequestration depends on several technical and economic factors:

• Assessing the availability of enough suitable storage sites to accommodate the volumes of CO2 produced by large power plants.
• Locating permanent storage sites relatively close to IGCC coal plants and/or siting pipelines for CO2 transport.
• Verifying the integrity of geologic disposal sites.
• Establishing a regulatory framework for storage siting and oversight.
• Determining responsibility for managing and monitoring the disposal sites.
• Assigning financial responsibility and liability.

The practicality and economics of some of these storage options are significantly in question. Legal and regulatory questions also plague storage options. Who is responsible for storage sites, monitoring and any ongoing financial obligations? The U.S. Department of Energy is funding regional carbon sequestration partnerships across the country to examine sequestration opportunities and tackle many of these tough issues.

The uncertain (though assuredly lengthy) timeline for achieving practicable sequestration means IGCC plants that do not capture and store CO2 could exacerbate, rather than relieve global warming concerns for a considerable period. Coal is the most carbon-intensive fossil fuel, and though an IGCC plant would emit 20 percent less CO2 than would a pulverized coal plant, its emissions would be higher than any non-coal power source. Siting an IGCC facility absent built-in CO2 capture and viable storage essentially locks in high levels of carbon emissions for 60 years or more.

Betting on near-term sequestration is a risky proposition. Scientific American recently reported that the emissions from fossil-fuel power plants projected to be built in the next 25 years would roughly equal the combined emissions of all power plants over the past 250 years (5). Since proven energy efficiency measures, wind farms and solar installations produce zero carbon dioxide during operation, the opportunity costs of investing in IGCC rather than efficiency initiatives and renewable resources are immense.  

Additional Concerns

The full life-cycle impacts of any form of generation must be considered. When it comes to land use and transportation, IGCC offers no advantages over conventional coal.

Coal extraction, whether through underground tunneling, mountaintop removal or, as is common in the West, surface strip-mining, scars the earth. All forms of mining create tons of hazardous wastes. Strip mining, while safer for workers, destroys habitat.

Reclamation work that appears successful on the surface may mask problems in the water table below.

Second, many of the proposed new coal plants will not be located adjacent to the mines themselves, so the coal will have to reach the plants by rail. While trains are an excellent means of transportation, diesel locomotives in the United States emit tens of thousands of tons of nitrogen oxide and fine particulate matter every year, and more particles fly off the filled coal cars during transport. A traditional 500-megawatt pulverized coal plant using Powder River Basin coal requires 56 train cars of coal a day to bring in the 1.4 million tons of coal it will burn in a year. An IGCC plant of the same size would require 44 cars per day, and with carbon capture and sequestration, 54 cars per day (6).

The reliability of rail transport is another serious concern. Even today, track problems often delay coal deliveries, especially from the Powder River Basin. Relying more heavily on coal would heighten the possibility of supply disruption-related rate spikes and of utilities turning to dirtier coal supplies. The Northwest rail system is already strained; adding additional rail capacity will be costly.

Costs

An analysis of the cost differential between an IGCC and conventional coal plant must consider, first, the additional expense of the gasification process itself, second, the additional costs of CO2 capture and separation and, third, the additional costs of actual storage (sequestration) and transporting the CO2 to the injection or other storage site.

Several studies have been done on IGCC costs, producing a range of results. That's hardly surprising, given the relative newness of applying IGCC technology to electric generation from coal. Cost estimates for actual capture, transportation and sequestration are especially speculative at this point (7).

1. Basic IGCC vs. conventional coal plant.
Currently, it's estimated that delivered wholesale power from a basic IGCC coal plant built without CO2 capture technology will cost about 20 percent more than power from a conventional pulverized coal plant - about 1 cent on top of today's going rate of around 4 cents per kilowatt-hour. (Technical advances, along with the value of avoided CO2 emissions, could narrow that gap in coming years. In fact, the Northwest Power and Conservation Council estimates that power costs for IGCC and conventional coal-fired electricity in the Northwest will be equal by 2010 or 2011 (8). )

2. IGCC plant with carbon capture vs. basic IGCC plant.
The extra expense and efficiency losses associated with built-in carbon capture would add an estimated 1 cent to 2.3 cents per kilowatt-hour to the cost of power from a basic IGCC coal plant. Capture costs do not include transportation or storage of the CO2.

• Transportation and sequestration.
  Transporting CO2 from an IGCC plant with carbon capture to a storage site and the actual storage is estimated to cost an additional 1.3 to 2 cents/kWh.

Thus, the total cost of power from an IGCC coal plant with full carbon capture and storage could be up to 4 cents per kilowatt-hour more than the cost of power from a basic IGCC plant. At today's prices, that's a doubling of the wholesale price of coal-generated electricity.

As noted, these costs are necessarily estimates and may well go up or down in coming years. Plus, the current price of a fledgling technology provides neither a comprehensive nor a long-range view of that technology's potential financial and social value.

That said, unless and until those costs dramatically plummet, IGCC coal with sequestration will remain far costlier than wind or efficiency measures. Decision-makers must consider whether redirecting federal subsidies to investments aimed at increasing energy efficiency and renewable energy economies of scale would produce greater benefits to society.

Conclusion

IGCC coal plants with carbon capture might be reasonable alternatives to the older pulverized coal plants now polluting the Midwest, Northeast and other areas that rely heavily on conventional coal-generated electricity. In oil and natural gas production areas where the CO2 can be injected into wells to stimulate additional harvest, the economics may be quite favorable. Serious questions about the appropriateness or necessity of IGCC coal in the Northwest will continue, however, even if the technology and economics of clean-coal combustion and sequestration dramatically improve.

This region is blessed with bountiful energy efficiency and renewable resources - enough to meet all projected increases in electricity needs several times over. The recent Tellus Institute study, commissioned by the NW Energy Coalition, showed that the region could tap more than 13,000 average megawatts of cost-competitive efficiency and renewables in the next 20 years (9). The Northwest Power and Conservation Council essentially confirmed those numbers in its Fifth Power Plan, recommending that energy efficiency and renewable energy (with very modest fossil fuel investments) should be used to meet the region's projected load growth (10).

The Coalition Board is expected to consider a resolution on coal policy at its next meeting, set for Oct. 23 in Seattle.

Citations

1. Jay Ratafia-Brown, Lynn Manfredo et. al, Science Applications International Corporation/U.S. DOE, "An Environmental Assessment of IGCC Power Systems," 7.

2. Energy NW, Integrated Gasification Combined Cycle, May 2005, 7.

3. Ratafia-Brown, Manfredo et. al, op. cit. note 1, 12.

4. Jeffrey King, Northwest Power and Conservation Council, personal communication, August 8, 2005. According to his analysis, for reference plants using Powder River Basin coal with an 80 percent capacity factor, pulverized coal consumption is 3891 tons per year per MW, IGCC without sequestration is 3225 tpy/MW, and IGCC with sequestration is 3785 tpy/MW. (The proportions are essentially the same for Ulinta coal from Utah, which has a higher heat rate.)

5. Robert Socolow, "Can We Bury Global Warming?" Scientific American, July 2005, 52.

6. Calculations based on 96 tons of coal per railroad car, and coal consumption figures from Jeffrey King, op. cit. note 7.

7. Cost figures have been gleaned from the following sources, among others: Coal-Based Power Generation for California with CO2 Removed for Use in Enhanced Oil Recovery, Parsons, 2002; Rich Ferguson, "Risky Diet 2005: Global Energy Resource Adequacy," (Center for Energy Efficiency and Renewable Technologies, June 2005), 54; Socolow, op. cit. note 5, 52; Jim Lacy, "Update on IGCC" in PacifiCorp, IRP Public Input Meeting, November 10, 2004, 10.

8. Communication with Northwest Power and Conservation Council Senior Resource Analyst Jeffrey C. King, August 30, 2005

9. Michael Lazarus, David von Hippel, Stephen Bernow, Tellus Institute, "Clean Electricity Options for the Pacific Northwest," Report to the NW Energy Coalition, October 2002.

10. Northwest Power and Conservation Council, "The Fifth Northwest Electric Power and Conservation Plan," ( Portland, OR: July 2005).

The NW Energy Coalition is an alliance of more than 100 environmental, civic and human service organizations, progressive utilities and businesses in Oregon, Washington, Idaho, Montana, Alaska and British Columbia. We promote development of renewable energy and energy conservation, consumer protection, low-income energy assistance, and fish and wildlife restoration on the Columbia and Snake rivers.