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Renew your energy: March 2010 Archives

Clean coal

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Some see the term "clean coal" as an oxymoron – you can't burn coal without producing carbon dioxide as well as other environmentally problematic solids, liquids and gases. But it is possible to move towards "cleaner coal" by filtering out or capturing some of the emissions. We already do this for acid emissions, but since the sulphur content of most fuels is relatively small, SO2 is a relatively small issue: the big issue is of course carbon dioxide – the main product of combustion.

"Carbon Capture" is the buzz word – separating out the CO2 produced in power stations. It requires complex and relatively expensive chemical processes, and then you have to find somewhere to store the resultant gas. The options for that include old coal seams, exhausted oil and gas wells, and as yet undisturbed geological strata of various types.

Along with many others, the IEA Clean Coal Centre has been promoting Carbon Capture and Storage as vital for the future. They point out that around 40% of the electricity generated globally comes from coal and that this is bound to grow – as countries like China expand. If they don't adopt CCS, then climate impacts could be significant.

There are some CCS-type projects in China, including the Green Gen project due to come online next year, eventually planned to expand to 650 MW, but most of the running is being made in the US, and to a lesser extent the EU.

The IEA group suggests that globally there is the potential for replacing 300 GW of existing coal plant with new CCS plants and for 200 GW of upgrading with CCS. But it currently looks like we will only see around 29 GW of coal-fired CCS in place globally by 2020. So what's stopping us?

Firstly, and mainly, the cost. CCS adds perhaps 50% to the capital cost of a of plant ($735/950 m for a new/retrofitted 400 MW plant). It also reduces overall energy conversion efficiency – some energy is needed for CCS. The IEA team says that the "energy penalty" is somewhere between 10–15% at present, although higher figures have been quoted, especially for CCS added on to existing plants. However, there are hopes of reducing the energy penalty to below 6% of output by 2030. Improved technology may also reduce the costs.

The cheapest option at present, which can be added on to existing plants, is simple post-combustion capture, but it's inefficient – it is hard to extract the CO2 from the large volumes of low-pressure exhaust gases. It's much cleverer to extract CO2 at an earlier stage – as in pre-combustion capture systems. In these Integrated Gasification Combined Cycle (IGCC) plants the coal is gasified, to produce a mix of methane, carbon monoxide, carbon dioxide and hydrogen. The carbon dioxide is then separated out while the other gases are used as fuel for power production. An extension of this approach is provided by firing with oxygen rather than just air – that increases overall efficiency, but adds complexity. Vattenfall has built a 30 MW (thermal) oxy-fuel demonstration plant. Meanwhile, there are many plans and programmes underway around the world (e.g. the EU has already put €1 bn into CCS, and the US $3.4 bn. Within the EU, RWE is planning a 450 MW IGCC unit, while the UK is planning four CCS plants, two pre-combustion, two post-combustion, to be backed by a new levy of 2–3% on electricity charges.

As this indicates, CCS is still a relatively expensive option for carbon reduction, at $35–70/tonne of CO2. Although there are hopes of it falling to $25–35t CO2, that's still much more than the current value of carbon under the EU Emission Trading System. So far CCS has not be eligible for support under the Clean Development Mechanism – India and Brazil amongst others have objected to its proposed inclusion. The fear is that supporting CCS will deflect resources away from renewables and other low-carbon options more relevant to them.

The second issue is eco impacts. It is conceivable that stored CO2 might suddenly be released in large amounts – and the resultant ground-hugging cloud of dense cold gas could asphyxiate any people it engulfed. The CCS lobby sees this as unlikely – we already pump gas into part-empty wells for Enhanced Oil Recovery, and oil and gas strata have stored methane and oil for millennia, so replacing them with CO2 should not lead to any risk of sudden catastrophic release. That may not be as certain with as yet undisturbed aquifers though (e.g. undersea earthquakes do occur). And on land storage in, for example, old coal seams, seems even more potentially risky, given nearby populations.

The IEA Group says that globally there is room for perhaps 40 Gt CO2 in coal seams, and that is being followed up in the USA – where there has been some local opposition on safety grounds. There is more room, possibly for 1000 GT globally in old oil and gas wells, but the big option is saline aquifers – maybe 10,000 GT. For comparison, according to Vaclav Smil's Energy at the Crossroads: Global Perspectives and Uncertainties, in 2005 world CO2 production was around 28 GT p.a.

The main driver for CCS is clearly the fossil-fuel industries desire to stay in business despite pressures to reduce emissions. In theory CCS can cut CO2 emissions from coal burning by 85% or more, and of course it's not just coal – some of the CCS projects involve natural gas. For example, French oil company Total has retrofitted a gas-fired plant at Lacq in the South of France with CCS in a £54 m pilot project, with the CO2 being sent down the existing pipeline, back to a major local gas well at Rousse, which used to supply to the plant, for storage at a depth of 4,500 metres. Moreover, power production may not be the only option – as noted above, coal gasification can produce a range of synfuels, some of which can be used for heating or for fuelling vehicles. Indeed it could be that this may offer a way to improve the economic prospects for fossil-fuel CCS – by moving into new/additional markets.

However, a rival option is biomass. That could be burnt just for power production or gasified to also provide synfuels, with, in either case, the CO2 being separated and stored. And if the biomass feed stock is replaced with new planting, then in effect, CCS would mean not just zero- or low-net emissions, but an overall reduction in carbon in the atmosphere – negative emissions. Production of biochar from biomass, with CCS, is seen by some as an even better option. But then there are land-use limits to the widespread development of biomass, whereas there is claimed to be lot of coal available around the world, with large reserves in China, N America and Russia/Eastern Europe, enough for more than 150 years at current use rates (although estimates vary).

While many environmentalist would like coal to be left in the ground, some see coal CCS as not only inevitable, but also as positively attractive, at least in the interim, and possibly as being a low-carbon alternative to nuclear. As long as it does not detract from the development of renewables.

For more information about Clean Coal, visit www.iea-coal.org.uk.

Under Ofgem's new 'Green Energy Supply' Guidelines, launched in February, suppliers offering 'green electricity' to consumers under the voluntary tariff system must demonstrate that their green tariff involves a commitment above and beyond what is required from existing government targets for sourcing renewable electricity and reducing emissions. In most cases that will involve some sort of fund to support additional projects, which might include community-scaled renewables or energy saving projects, or even carbon offsetting projects.

The rules for domestic tariffs in the new scheme require that offsetting projects save or avoid the emission of at least 1 tonne of carbon dioxide equivalent annually, and 50 kg of CO2 equivalent emissions p.a. for all other environmental activities, such as community-scaled renewable-electricity projects, these all having to be additional to that saved from any existing programmes (e.g. as counted within the Renewable Obligation (RO)). Basically they can't just use power already credited under the RO. To meet the new rules they must do more, and the new scheme provides specifications, which will be accredited by an independent panel, overseen by the National Energy Foundation. Visit www.greenenergyscheme.org.

The voluntary green-power market has always sat uneasily on the margins of the UK Renewables market – which is driven by the Renewable Obligation. All electricity consumers already pay their suppliers extra for that, so the voluntary green power schemes have to offer something else to give extra value – they just can't charge extra twice for the same electricity used to meet the suppliers RO requirements. Most suppliers have already been offering additional green benefits to justify premium prices – some have set up funds to support green projects. But not all have charged more. For example, npower set up a self-financed fund for its Juice scheme to support new marine-renewables projects – it's reached over £2 m so far.

Quite a range of schemes have emerged, with there being some confusion and indeed scepticism about the validity of some of the claims to 'green-ness' being made. The new rules puts these schemes, and the additional elements, on a more formal basis.

All the large main suppliers including British Gas, E.On, EDF Energy, RWE Npower, Scottish and Southern Energy and Scottish Power, and linked groups, have signed up to the new scheme, as well as independent supplier Good Energy.

Unlike the 'big six' suppliers, who also sell non-green power, Good Energy buys in and sells 100% green power from mostly local independent sources – and retires any Renewable Obligation Certificates (ROCs) it gets, rather than selling them on. So it claims that it will help renewables to expand, since the value of ROCs will rise proportionately. The other main independent, Ecotricity, sells a roughly 50/50 mix of green/conventional power, which it sees as being reasonable since it is still four times as much green power than currently required by the RO targets. It also charges a premium green-tariff rate, but says the income helps it to invest in new renewable-energy projects – and it certainly has been pushing ahead with major wind projects.

However, Ecotricity has been very critical of the new OFGEM scheme and has not joined. It argues that the renewable energy used under the new tariffs will still all come from Britain's same pool of RO-linked renewable electricity, which meant that the big energy companies would not be required to build any extra major source of renewable energy. They will simply provide added-on schemes such as carbon offsetting, help with micro-generation or energy-efficiency schemes.

When the guidelines were first proposed last year, Ecotricity's CEO Dale Vince said: "In these guidelines Ofgem are accrediting everything you can imagine except the thing that really counts – green electricity. Of course we believe in planting trees, protecting wildlife and cutting carbon, all of these things have an important role to play – but not in green tariffs. Green tariffs and consumer choice of green-tariffs – people power – could play a crucial role helping us to reach government renewable-energy targets. But Ofgem has sidelined the consumer in one fell swoop by excluding real green electricity from its definition of so-called green-tariffs."

After the launch earlier this year he reaffirmed his view: "Green-electricity tariffs should be about more than feel-good charity schemes. If suppliers want to plant trees or even help old ladies across the road, I'm all for that but not under the guise of green electricity. Ofgem's new 'rules' set an artificial standard of what green electricity really is. This can only result in them becoming an expensive niche product in a charity ghetto, doing more harm than good. Consumers will get poorer, but Britain won't get any greener as a result of this."

That may be overstated, after all the new scheme does require real carbon-emission reductions, but he may be right in principle – while some small community project may get some support, it won't lead to extra capacity in the mainstream renewables sector. Basically the problem is that the government wants the Renwables Obligation to be the main vehicle for supporting renewables and sees the green consumer tariff as additional and voluntary. Certainly, so far, the uptake has been marginal – only about 2% of UK consumers have signed up to such schemes. What's not clear is what will happen when the new Feed-In Tariffs (FiTs) for small projects come online from April onwards. Since it's outside the RO, will that power, including some from community projects, be available for 'voluntary' tariff schemes? That might change things, even though the FiT is also only seen as a small, marginal exercise, leading to at most to 2% contribution to UK electricity by 2020.

Elsewhere in the EU, Feed-In Tariffs and green-energy certificates schemes used by consumers are taken seriously, and have had major impacts. In the UK though they are still seen as marginal – the focus remains on the competitive market orientated RO, despite the fact that, so far, this has been poor at delivering much renewable-energy capacity.

For more on renewable-energy developments and policies, visit Renew: www.natta-renew.org.

The debate on the UK's new Feed-In Tariff (FiT) has been quite lively, with the Guardian's George Monbiot arguing that, with solar PV being still very expensive, the way the FiT provided the support needed was economically regressive.

It does look that way at first glance – those that could afford to invest say £10,000 in PV might get £1000 p.a. back for the electricity they generated and used, paid for by all the other consumers, who would be charged extra via their electricity bills. It's been suggested that this would lead to a £11 p.a. surcharge on bills by 2020.

However, in a rebuttal to Monbiot's analysis, Jeremy Leggett from Solar Century said "the average household levy in 2013, when tariff rates are all up for review, is likely to be less than £3" and he added "this is far less than the average saving from the government's various domestic energy efficiency measures over the same period. So there is no net subsidy. The levy is not 'regressive' at all".

The extra cost is certainly small, since the expected size of the FiT scheme is small, only maybe leading to 2% of UK electricity by 2020, so maybe this is not a major issue. But it is good to see that the government has now announced a "green-energy loan" scheme (part of its new "Warm Homes, Green Homes" strategy) under which energy-supply companies and others (e.g. the Co-op) may offer consumers zero or low interest loans for installing new energy systems, to be paid back out of the resultant energy savings. Details have yet to be agreed, but up to £7 bn may be made available over the next decade in this way – although it seems it will start off slowly, from 2012 onwards.

This scheme could help the less well-off to invest in new energy technologies like PV, and join in the FiT. Providing up-front loans via a "pay-and-you-save" system certainly seems likely to be more effective at ensuring wide uptake than just using revenue over time from a FiT. And there would be no extra charges on the taxpayer or the other consumers. So it could be popular.

There does seem to be a lot of support for self-generation. A YouGov survey for Friends of the Earth, the Renewable Energy Association and the Cooperative Group found that 71% of homeowners who were asked said that they would consider installing green-energy systems if they were paid enough cash. So perhaps, one way or another, uptake will be significant.

However, there are still some uncertainties. I argued in an earlier blog, before the UK FiT details emerged, that, while it worked very well for wind in Germany, using a FiT to push PV down its learning curve, to lower prices, might not be the most effective approach for PV.

Now we have the details of the tariff, which has set the price for PV so that those who install it get the same rate of return as those using other cheaper options. This may be fine if you are desperate to get PV accelerated. That's a matter of judgment. For electricity, in the UK context, large-scale on-land and off-shore wind is clearly a better bet for the moment in terms of price, and also the scale of the resource. But PV prices are falling, and it could well be next in line for expansion, helped by the FiT, plus the loan scheme. Certainly there are benefits: localized generation using micro-power units like PV do avoid long-distance transmission losses, which can amount to up to 10% across the whole UK, and that is important.

However, domestic micro-generation has it limits – it's arguably the wrong scale. PV is one of the better ones – there are no real technical economies of scale, except via bulk buying and sharing installation costs for larger projects. But micro wind is only relevant in a very few urban UK locations – larger grid-linked machines in windy places are so much more efficient and cost effective. Solar heating (to be supported under the forthcoming Renewable Heat Incentive) maybe be the best domestic option, but even then there are economies of scale (e.g. for grouped-solar schemes sharing a large heat store or even solar-fed district heating). Micro Combined Heat and Power (CHP) similarly: larger-scale mini or macro CHP, linked to district heating networks, are arguably more sensible.

Fortunately the 5 MW UK FiT ceiling, though low, gives us a chance to operate at slightly larger community scale, which may redeem the whole thing. See the excellent Energy Saving Trust report Power in Numbers, which states that "the economics of all distributed energy technologies improve with increasing scale, leading to lower cost energy and lower cost carbon savings and justifying efforts for community energy projects". And for some smaller-scale renewables, it adds that "it is only when action occurs at scales above 50 households, and ideally at or above the 500 household level, that significant carbon savings become available".