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The value of co-operation

World Coal,

Coal is an important energy source in many countries, as it is cheap and available. According to a new report from the IEA Clean Coal Centre, improving coal’s environmental performance through clean coal technologies (CCT) and carbon capture and storage (CCS) is key to its future role in the energy mix.

The report R&D programmes for clean coal technologies, by Anne  Carpenter, explains why major investment in research, development and demonstration (RD&D) is needed to develop these technologies.  Anne Carpenter of the IEA Clean Coal Centre has reviewed the policies that drive RD&D of CCTs in Australia, China, the EU, India, Japan, South Korea, South Africa and the US.

Most of these countries have produced coal and CCS roadmaps, which set out the key RD&D objectives and milestones, and clarify the technological challenges that need to be overcome. Many of them regard international collaboration and knowledge transfer as important elements in developing and deploying CCTs and CCS. A number of demonstration projects, such as the Callide oxyfuel project in Australia and the GreenGen IGCC project in China, involve international participation.

Carpenter commented “In the current economic climate and with the squeeze on governments’ budgets, collaboration is needed at both national and international level, including public-private cooperation. International collaboration can enable governments to conduct more RD&D at a lower cost and with less duplication”.

Positive financial returns are evident - that is, investing in RD&D pays off, although it is difficult to carry out detailed evaluations of the specific outcomes of RD&D. For example, the US government’s investment in the CCT R&D programme over the period 2000 – 20 is expected to achieve a 13:1 return. An internal rate of return of 15% would be attained in the European Union for RD&D investments in the Strategic Energy Technology Plan (which includes coal-fired power generation with CCS) over the period 2010 – 30. In addition, investment in, and commercialisation of, clean coal and CCS technologies will contribute to innovation, create jobs and fuel economic growth.

Innovation in the energy sector is challenging because of the long development times and, for CCS, the construction of the infrastructure for CO2 transport and storage. Government support for CCT and CCS RD&D is needed to stimulate the development of advanced clean coal power generation to reduce emissions.

Global funding for energy RD&D is failing to keep pace with the requirements for a low carbon future. The International Energy Agency (IEA) estimated, in its publication Tracking clean energy progress 2013, that RD&D investment in clean energy technologies needs to increase by 3 to 6 times to limit the average global temperature increase to 2°C by 2050, and probably even higher for CCS technologies. The estimated funding gap for higher efficiency coal-fired power generation and CCS amounts to an annual deficit of between US$700 and US$1800 million for higher efficiency coal. The IEA analysis indicated that public sources need to contribute at least half of overall low carbon RD&D needs.

Governments fund RD&D mainly through domestic research budgets, grants and loans. Revenue generated from carbon taxes, tax credits and incentives could be used to fund RD&D. For example funds raised from the European Union emissions trading scheme are used to support large-scale CCS demonstrations. India is financing a National Clean Energy Fund by a levy on the amount of coal produced or imported, whilst Australian bituminous coal producers are helping to fund low emission coal technology demonstrations through a voluntary levy. More schemes like these could accelerate the development of CCTs and CCS.

In general, governments are fostering RD&D into advanced ultra-supercritical and integrated gasification combined cycle (IGCC) power generation, integrated gasification fuel cells (in particular, Japan), advanced fluidised bed combustion, oxyfuel combustion and pre- and post-combustion CO2 control. The national RD&D demonstration projects reflect this work.

The importance a country attaches to CCT RD&D can be seen in the number of coal initiatives and programmes in place. Countries, such as China, Japan, South Korea, Australia and the USA, have coal research and development (R&D) policies designed to help meet their energy policy goals.

Written by Anne Carpenter, IEA CCC. Edited by Sam Dodson

The report, R&D programmes for clean coal technologies by Anne Carpenter, CCC/244, 119 pp, October 2014 is available for download from the IEA Clean Coal Centre Bookshop. 

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