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Enabling low-emission coal-based electricity generation

Published by
World Coal,

Sowmyavadhana Srinivasan, GlobalData.

Coal is the most abundant and widely distributed fossil fuel in the world. It is found on every continent and in more than 70 countries, with the US, Russia and China possessing the largest reserves. At the end of 2013, proven coal reserves amounted to 891.5 billion toe and, at the present rate of consumption, these reserves are expected to last for another 112 years at least. In comparison, natural gas and oil reserves are expected to last for 60 years.

Clean coal technologies are used to improve the efficiency of existing coal-fired power plants and reduce their carbon dioxide (CO2) emissions without affecting the amount of power generated. One of the ways to achieve this is improving the boilers that are used to generate steam. The types of clean coal technologies that perform this are:

  • Supercritical (SC).
  • Ultra-supercritical (USC).
  • Circulating fluidised bed (CFB).
  • Integrated gasification sombined sycle (IGCC).

Growing environmental concern supports clean coal technologies

With population sizes increasing and industrialisation occurring at a rapid rate, global electricity demand has been increasing, which has led to a greater focus on increasing power generation capacity.

Coal power is the cheapest energy to generate. However, it is also the one that emits the most CO2. Growing concerns over CO2 emissions and climate change have made countries wary of traditional coal-fired power generation. Nevertheless, coal accounts for about 25% of global electricity generation and is likely to maintain its status as a key fuel source, especially in developing countries as coal prices have also been lower and more stable than oil and gas prices.

Countries with growing economies and abundant coal reserves, such as China, India, Poland and South Africa, plan to increase their installed capacity with coal. They also plan to reduce their power deficit and improve the operational efficiency of their plants by adopting clean coal technologies. By improving the operational efficiency of their coal-fired plants they will increase power generation and reduce emissions.

Meanwhile, the US, Germany and China have banned installations that neither have clean coal technologies nor adhere to stringent emission norms. Environmental regulations pertaining to the coal industry are designed to reduce the hazardous air pollutants emitted by coal-fired power plants. Countries are impelling utilities to support a more environmentally friendly form of coal power by adopting clean coal technology.

Renewable technology will reduce adoption of clean coal

Although the short-term threat to coal energy from developments in the wind, solar, hydro, biomass and biogas sectors is minimal, alternative energy sources are expected to pose a substantial threat in the long term. Increasing environmental awareness is an important factor supporting the development of renewable technologies, which are much more environmentally friendly than coal energy. Additionally, the cost of power generation from alternative sources of energy is decreasing, which will make them competitive with coal energy.

Governments are introducing mandates to reduce emissions and providing incentives in the form of tax relief, capital cost grants and subsidies, to encourage the increased generation of power from clean energy sources.

Substitute fuels, such as gas, are also hindering the development and deployment of clean coal technologies. Gas-powered plants are much cleaner than coal-fired plants and their emissions are lower. In the US, the recent increase of shale gas production led to gas prices falling below those of coal, which forced some utilities to shelve plans to construct coal-fired power plants, opting for gas-fired power plants instead. The rise in gas output in the US is expected to result in the country becoming a gas exporter.

Major markets for clean coal technologies

There are very few upcoming coal projects in Western Europe and the US. Non-retiring retrofit projects will mainly drive these markets.

Asia is the biggest market for clean coal technology and China has the most clean coal installations. Close to 45% of its installed capacity is clean coal. China has mandated that all large power plants be constructed with clean coal technologies and has provided strict emission rules for coal power plants, which has resulted in the quick adoption of clean coal technologies in the country.

Most of the mega coal power plant construction carried out in India is also SC or USC technology-based. In Japan, only 25% of installed coal capacity is subcritical coal-fired capacity, as of 2014, with clean coal installations accounting for close to 75% of installed capacity. Even South Korea has been a pioneer in using clean technologies and reducing emissions in many of its industries. Clean coal accounts for over 80% of its installed coal capacity. During the forecast period, China is expected to lead the global market for clean coal capacity additions. A substantial amount of SC and USC capacity is expected to come online, supported by government mandates. IGCC technology will also see substantial additions in the 2015 – 2025 forecast period.

The global clean coal market will continue to be dominated by SC technology, which accounted for 50–60% of the clean coal installations during the 2011–2014 period. USC-based capacity will see growth in market share, while IGCC, which is a nascent technology, is not expected to grow significantly. However, if the technology is proven and becomes less expensive, IGCC installations could increase.

Written by Sowmyavadhana Srinivasan. Edited by

About the author: Sowmyavadhana Srinivasan is GlobalData’s senior analyst covering the power sector.

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