Select Committee on Welsh Affairs Third Report


3  Clean Coal Technology

Background

39. International Energy Agency forecasts have indicated that some 38% of the world's electricity will still be generated from coal by 2020.[53] That reliance was reinforced by many of our witnesses who had identified a global switch back to coal.[54] The reason for that switch back to coal can be, in part, attributed to an increase in the price of oil, and concerns over the security of the supply of natural gas. Indeed, during our visit to the United States, we were told that the coal industry was "the most buoyant and optimistic" of the US energy sectors.[55] A global desire to cut carbon emissions alongside the expansion of Chinese and Indian economies with heavy reliance on coal, meant that "the importance of clean coal technology cannot be underestimated".[56] The key to the long term viability of the coal industry, both globally and in Wales, is the promotion of those technologies.

40. The Renewable Energy Foundation claimed that fossil fuels will necessarily continue to provide the bulk of energy in the UK, for some time to come.[57] Indeed, Malcolm Wicks MP told us that on average, 30% of the UK's electricity was fuelled from coal,[58] and in the winter months of December 2005 through to March 2006, coal contributed an average of 50% of the UK's electricity generation.[59] Ensuring that this fossil fuel is used efficiently and without emissions is therefore essential.[60] Wales TUC Cymru told us that in order to make a significant contribution towards cutting greenhouse gases, more clean coal plants needed to be built in the UK.[61]

41. Clean Coal Technology could therefore play a vital role in addressing Wales' future energy needs.[62] The Renewable Energy Foundation claimed that Wales was a likely beneficiary of the now inevitable coal rebuild in the United Kingdom's energy portfolio.[63] Andrew Davies AM, Minister for Enterprise, Innovation and Networks, told us that: "there is no doubt that large-scale fossil-fuelled stations will remain the mainstay of electricity production in Wales for the next 20 years".[64] Malcolm Wicks MP, the UK Government Energy Minister confirmed that most of that coal is imported.[65] The Welsh Assembly Government was optimistic that new technologies for the exploitation of underground coal reserves, combined with carbon capture and storage, could create a major indigenous Wales coal industry.[66] Tyrone O'Sullivan, the Chairman of Tower Colliery in Hirwaun, south Wales, shared the Welsh Assembly Government's optimism for the future of Welsh coal. He believed that if the political will was there, the future of coal-mining could be a "booming industry in Wales".[67] RWE npower as a consumer also expressed its desire for locally-mined coal rather than imports from around the world.[68]

Generating Electricity from Coal

42. There are two main methods for generating electricity from coal: combustion and gasification. The most common type of combustion plant is often called a Pulverised Fuel (PF) station since the coal is finely ground before it is injected with air into the plant's combustion chamber. The burning particles produce heat, from which high pressured steam is produced to drive a steam turbine, which in turn produces electricity. All UK coal-fired power stations are combustion plants and were designed over 30 years ago.[69] The plants currently operate at relatively low pressures and temperatures (so called 'subcritical' steam cycles) and therefore operate at efficiencies of between 36- 39%.[70]

43. The second type of power stations are integrated gasification combined cycle (IGCC) plants which employ gasification technology. IGCC is a newer and more efficient technology than Pulverised Fuel, and there are currently only four coal-fired IGCC plants around the world.[71] Gasification can be used on many solid or liquid fuels, including coal. It converts the energy source into a gas, the major components of which are hydrogen and carbon monoxide. This raw 'syngas' is cooled and scrubbed several times to remove pollutants. That process makes gasification a cleaner process than PF combustion. IGCCs operate a 'combined cycle'.[72] First, the fuel is partially burnt during gasification, using controlled amounts of air or oxygen, and combustion is completed when the resulting gas is burned later in a gas turbine to generate electricity. In addition, the hot exhaust gases can then be used to produce superheated steam to drive a steam turbine, producing further electricity.[73]

Reducing Carbon Emissions: Clean Coal Technology

44. Clean coal technologies (CCTs) are defined as those that facilitate the use of coal in an environmentally satisfactory and economically viable way. To date CCTs have focused on reducing levels of acid gases and particulates from flue (waste) gas emissions. In response to concerns about climate change, attention is turning to CO2 emissions.[74] Friends of the Earth Cymru welcomed this development as the power station sector continues to be the single largest source of carbon dioxide emissions in the UK. It stated that a limited role for more efficient and less polluting coal systems would be acceptable.[75] Roger Shepherd added, "clean coal technologies make possible the use of coal in an environmentally acceptable and economically feasible manner".[76]

45. Three ways have been identified to reduce carbon emissions from coal combustion and gasification in order to produce electricity from more efficient coal. They are biomass co-firing, improving efficiency, (so that less coal is burned per unit of electricity generated) and the development of carbon capture and storage technologies. [77]

BIOMASS AND CO-FIRING

46. Biomass, such as energy crops and forestry waste, are considered carbon neutral[78]. Co-firing of biomass with coal is currently seen as a transitional stage in the process of replacing fossil fuels and reducing carbon emissions. Several UK power stations with PF combustion technology now co-fire up to 10% biomass with coal, but research is underway to raise the level of co-firing to 50%. It is estimated that a 10% saving of carbon could be made by co-firing with biomass.[79] In the longer term, the application of CCS to power plants that use biomass would be a means of removing CO2 from the atmosphere permanently.[80]

IMPROVED EFFICIENCY

47. Both the DTI and the European Union are involved in a number of feasibility studies exploring possible retrofitting of advanced supercritical boiler and turbine technologies (along with Carbon Capture and Storage) to existing coal-fired power stations. However, there is a debate among industry experts and academics about the economic viability of such retrofitting. Efficiency could also be improved through building new plants that employed advanced technologies. Supercritical plants operating in Denmark and Germany reach efficiencies of 47%. Ultrasupercritical designs purported to reach efficiencies in excess of 50% have been proposed, but the advanced materials necessary to implement such technologies have not yet been fully tested.[81] It is estimated that a 20% carbon saving could be made from employing this technology.[82] Currently the four IGCC plants run at efficiency rates of between 37-43%. The US Government predicts that its new $1 billion Futuregen project— an integrated power and hydrogen generation and carbon storage project announced in 2003—could improve on these efficiency levels and ultimately provide IGCC technologies that reach levels in excess of 60% efficiency.

CARBON CAPTURE AND STORAGE

48. Carbon Capture and Storage (CCS) refers to the capture and storage of carbon dioxide from emissions to prevent it from entering the atmosphere.[83] The DTI's Carbon Abatement Technologies (CAT) Strategy for Fossil Fuel Use (June 2005) estimated that an 85% carbon saving could be made from fossil fuels by employing this technology.[84] Brian Morris, Assistant Director, Carbon Abatement Technologies, Department of Trade and Industry, explained to us that "the idea of carbon capture storage is that if you are burning a fossil fuel like coal or gas you capture the carbon dioxide [and then] transport it to a point where you can geologically store it away from the atmosphere".

49. During our visit to the United States. we heard of several examples of research and development projects focused on reducing the cost of carbon capture technology. For example, Mr Ron Carty of the Illinois Clean Coal Institute highlighted a state wide survey which explored ways in which CO2 could be safely stored when captured.[85] Mr Massound Rostam-Abadi, responsible for the Illinois State Geological Survey, told the Committee how a $30 million project was focused on using clean coal technology to reduce the 90% of carbon emissions in Illinois that came from coal powered plants in the Illinois basin.[86] He cited a further example of a project in which academics were working on ways that the carbon could be captured pre-combustion (rather than post-combustion), which was cheaper and more efficient as the coal could also be used to produce steam and other forms of energy. 90% of the costs of carbon capture were in transportation and storage and these were not expensive. Therefore, research was focused on reducing the cost of carbon capture itself. It was estimated that reducing the cost of carbon capture by 50% would give the carbon capture technologies a significant competitive and commercial edge. [87]

50. Brian Morris from the DTI explained that there are a number of ideas for carbon storage:

    "The depleted oil and gas fields in the North Sea are potential sites for disposal of the carbon dioxide. The aquifers, provided they are the right type of aquifer... once filled up…you can seal it, and the theory is that it will stay down there for millennia. We want to store this stuff away for basically hundreds of thousands of years, so nine years is nothing really, but the evidence suggests that it does appear to be working".[88]

Disused coal mines have been suggested as a potential option for the storage of carbon, and Friends of the Earth Cymru told us that they supported research to identify suitable capture and storage sites in geological structures with proximity to Wales.[89] However, Wayne Thomas from the National Union of Mineworkers explained that once you extract the coal you break the rock strata and therefore break the natural seals within the rock. Breaking the rock strata, and the fact that mines in south Wales were "close to the surface", led him to conclude that the storage of carbon in south Wales mines was not best option for government or industry to explore.[90]

Clean Coal Technologies in Wales

51. The National Union of Mineworkers (South Wales Area) told us that if clean coal technology was researched and developed to a high standard in the UK, Wales would be in a position to market those skills into other economies to the further benefit of Wales. In their view the UK had the potential to be a world leader.[91] The All Wales Energy Group agreed. It asserted that those technologies represented "a great market opportunity for Wales".[92]

52. RWE npower has invested significantly in Flue Gas Desulphurisation technology (FGD) which is currently operational at Uskmouth power station: described to us as one of the "cleanest coal plants in the UK".[93] Similar technology is due to be fitted at Aberthaw power station and Phil White, Marketing Director of Tower Colliery told us that £100 million had been invested in installing FGD at Aberthaw.[94]

53. RWE npower has also invested in co-firing technology and the use of carbon neutral biomass fuels in the main boiler plant at Aberthaw. In 2004, following extensive plant trials, approval was obtained from the Environment Agency to also co-fire coal with tallow and sawdust. A total of 11.5KTe of tallow and 13.5KTe of sawdust were fired during 2004.[95] Friends of the Earth Cymru supported that development and estimated that biomass co-firing could significantly reduce emissions from coal.[96] However, on our visit to Aberthaw, we were informed that they were no longer permitted to burn tallow.[97] However, Malcolm Wicks MP assured us that the Waste Incineration Directive did not ban the use of tallow as fuel. He stated that "installations may burn tallow provided they comply with regulatory requirements. If […] the tallow is waste within the EU Waste Framework Directive, the regulatory requirements allow for a permit to be issued under the Pollution Prevention and Control Regulations 2000 incorporating the requirements of the EU Waste Incineration Directive".[98] We welcome the clarification given by the UK Energy Minister that power stations are permitted to co-fire with tallow.

54. Tower Colliery has been working on a number ways of producing lower-carbon coal through coal-firing.[99] It has also developed technologies for the capture and re-use of methane, and has built a briquetting plant to combine coal and wood waste into part biomass fuel.[100] However, Phil White expressed disappointment that the blended coal and biomass produced at Tower was not allowed in to be used at Aberthaw power station because "Ofgem insisted on more rigorous quality control checks".[101] He believed that Tower had been "let down from developing where we have been for the last few years because of a clash of interests between Ofgem, the regulator, and the DTI themselves, who actually hand out the programmes on clean coal technology".[102]

55. We welcome the investment into the development of clean coal technologies in Wales, in particular at Tower Colliery and Aberthaw power station. We are concerned that apparent differences of approach between Ofgem and the DTI on the use of biomass is frustrating further development in this area. We recommend that the Government investigate this matter and update the Committee in its response to this report.

Government Strategy and Approach

56. Over the last three years the DTI has published three reports on Clean Coal Technology and Carbon Capture and Storage. They were:

    Implementing a Demonstration of Enhanced Oil Recovery Using CO2 in the North Sea (May 2004)[104];

    Carbon Abatement Technologies (CAT) Strategy for Fossil Fuel Use (June 2005).[105]

57. The CAT Strategy stated that fossil fuels would be a major source of energy for decades to come and, if the UK was to meet its climate change targets, it would have to be used much more cleanly than at present. It further acknowledged that technologies to make fossil fuels more environmentally acceptable needed to be developed and brought to market. Government support was also necessary to enable carbon capture and storage to become commercially viable.[106]

58. Clean coal technologies are currently promoted as part of the UK Government's Carbon Abatement Technologies Strategy, published in June 2005. The Government has committed to spending just over £50 million between 2002 and 2008 to help emerging renewable and low carbon technologies.[107] Brian Morris from the DTI, explained that since 1999 the DTI had allocated about £13.5 million on about 45 R&D projects related to clean coal technology. Under the new technology strategy arrangements within the DTI, there was also a share of roughly £20 million which could be allocated to some sustainable fossil technologies.[108]

59. Brian Morris told us that "in June Malcolm Wicks MP announced a carbon abatement technology strategy which sees how we should be developing these technologies over the next 20 or so years…In fact he was also at that time able to announce the £25 million that we have been given by the Treasury. That sets our framework in developing clean fossil technologies up to 2020 and just beyond. The aim is really working through more efficient technologies - using the coal more efficiently, therefore less emissions - biomass through to carbon capture storage, where there is huge potential for large cuts in carbon emissions".[109]

60. However, ScottishPower told the House of Commons Science and Technology Committee that the "£25 million committed to funding demonstration projects was "small relative to the funding already committed by the US Government".[110] Our meetings in Chicago with U.S. coal experts supported that conclusion. For example, on our visit to the US, we found that in 2003 U.S. invested $1.8 million into research into the feasibility of capturing CO2 from power plants. A further $50 million had been invested in 2005, with a third phase of funding promised for 2010.[111] In its Report, the Commons Science and Technology Committee concluded that that the piecemeal allocation of funding suggests a worrying lack of strategic vision in UK Government decision making.[112]

61. Representatives of the Welsh coal industry expressed similar concerns about the level of funding. Phil White, Marketing Director of Tower Colliery told us that the amount of money allocated to clean coal technology through DTI programmes was "minimal".[113] He expressed further concern that while new technologies were "advancing in most other countries throughout the world", he had not seen "any DTI clean coal technology programme which has moved on from where we set them out ten or 15 years ago".[114] He argued that the only advance had been "FGD being installed on a number of our coal-fired power stations in the UK".[115] He concluded that :

    "We have not got much of a coal industry to turn up our production but we could produce more coal in three, five or ten years' time from where we are today. To do that we need also to understand the type of technology which is going to be suitable and the cleanest technology and the type of technology which provide the jobs and the employment. I think it is fair to say that, as an industry, we are very disappointed at the lack of moving forward with further research in this clean coal technology".[116]

WELSH ASSEMBLY GOVERNMENT

62. As part of their Energy Route Map, the Welsh Assembly Government has identified clean coal as a key priority.[117] It told us that clean coal technologies could greatly assist in fulfilling the Welsh Assembly Government's sustainable development duties. Andrew Davies AM, Minister for Enterprise, Innovation and Networks, added that pursuing those opportunities at the research, demonstration and full commercial levels needed to be a high priority and declared that he would welcome the development of demonstration projects in Wales".[118]

63. Our inquiry has found widespread support for the Welsh Assembly Government's objective to establish Wales as an attractive location for coal/carbon capture and storage initiatives. The Countryside Council for Wales told us that the development of carbon capture and storage technology within Wales could, in the long term, provide major economic and environmental benefits. The Council argued that "the sooner the technology and feasibility of this is explored and developed the better".[119]

64. Those sentiments were echoed by Andrew Davies AM of the Welsh Assembly Government, who expressed his frustration that "Wales has hundreds of years of coal reserves, we feel very strongly that clean coal has a role to play in that. Maybe, if as much investment had been made in developing clean coal technology as has occurred in gas, we would be in a much better position in Wales when dealing with the challenges faced by energy production".[120]

65. We are disappointed at the low levels of DTI funding into the research and development of clean coal technologies. We are concerned that the Government's lack of foresight is compromising Wales' potential to be a world leader in clean coal technologies, and is frustrating the potential to revive a rich and experienced indigenous coal industry in Wales. Furthermore, we endorse the Science and Technology Committee's view that the piecemeal allocation of funding suggests a worrying lack of strategic vision in Government decision making, in contrast to the clear vision and commitment to coal given by the United States Government.

66. Brian Morris of the DTI, was aware of activity on clean coal technology in Wales but was unable to cite any specific examples because "with all these projects, Wales and England and Scotland are all taken as one".[121] Malcolm Wicks MP, told us "we have £35 million for a carbon abatement programme which will be sponsoring a number of quite small-scale projects to develop this kind of technology. There are now one or two commercial plans to exploit clean coal technology in this country.[122]

67. Phil White, Marketing Director of Tower Colliery expressed his frustration at the Government's lukewarm approach to clean coal technology. He said "while we have been sitting back in the UK, with a lead 20 years ago, we have sat back for 20 years, every other country which has got an interest with its own indigenous resource of coal is pushing forward on clean coal technology".[123]

68. We share our witnesses' frustration at the Government's laissez-faire approach to the development of clean coal technology in Wales. Wales has considerable indigenous supplies of coal, which, if accessed through clean coal technology could provide a major indigenous clean and secure energy source. Urgent action is required now to ensure the future of clean coal in Wales and we look to the Government to provide that leadership.

69. The Department of Trade and Industry needs to prove, through a more urgent and pro-active approach, that clean coal technologies have a major role to play in the United Kingdom's future energy mix.


53   Ev 342 Back

54   Ev 98 Back

55   Visit to the United States, Annex 1. Back

56   Ev 342 Back

57   Ev 183 Back

58   Q 871 Back

59   Q 871 Back

60   Ev 183 Back

61   Ev 344 Back

62   Ev 343 Back

63   Ev 184 Back

64   Ev 197 Back

65   Q 871 Back

66   Ev 197 Back

67   Q 484 Back

68   Ev 49 Back

69   Post note 253, Parliamentary Office of Science and Technology. Back

70   Post note 253, Parliamentary Office of Science and Technology. Back

71   First Report from Science and Technology Committee, Meeting the UK Energy and Climate Needs: The Role of Carbon Capture and Storage, HC 576-1 of Session 2005-06, p. 8 Back

72   Post note 253, Parliamentary Office of Science and Technology. Back

73   Visit to the United States, Annex 1. Back

74   Post note 253, Parliamentary Office of Science and Technology Back

75   Ev 98 Back

76   Ev 244 Back

77   Postnote 253, Parliamentary Office of Science and Technology. Back

78   See Section 8 of Report Back

79   Carbon Abatement Technologies (CAT) Strategy for Fossil Fuel Use (June 2005) Back

80   Postnote 253, Parliamentary Office of Science and Technology. Back

81   Post note 253, Parliamentary Office of Science and Technology. Back

82   Carbon Abatement Technologies (CAT) Strategy for Fossil Fuel Use (June 2005). Back

83   A detailed technical appraisal of CCS technology can be found in the Intergovernmental Panel on Cilmate Change (IPCC) Special Report on Carbon Dioxide Capture and Storage, Autumn 2005. www.ipcc.ch/activity/srccs/index.htm Back

84   Carbon Abatement Technologies (CAT) Strategy for Fossil Fuel Use (June 2005). Back

85   Visit to the United States, Annex 1. Back

86   Visit to the United States, Annex 1. See also www.isgs.uruc.edu Back

87   Visit to the United States, Annex 1. See also www.isgs.uruc.edu Back

88   Q 59 Back

89   Ev 98 Back

90   Q 514 Back

91   EV 128 Back

92   Ev 174 Back

93   Ev 196 Back

94   Q 507 Back

95   www.rwenpower.com/cr/docs/powerstations/Aberthaw.asp Back

96   Ev 98 Back

97   Visit to South Wales, Annex 3. Back

98   Ev 241 Back

99   Q 492 Back

100   Q 492 Back

101   Q 506 Back

102   Q 506 Back

103   DTI, Review of the Feasibility of Carbon Capture and Storage in the UK, Cleaner Fossil Fuels Programme, September 2003. Back

104   DTI, Implementing a Demonstration of Enhanced Oil Recovery Using CO2 in the North Sea, Cleaner Fossil Fuels Programme, May 2004. Back

105   DTI, A Strategy for Developing Carbon Abatement Technologies for Fossil Fuel Use, Carbon Abatement Technologies Programme, June 2005. Back

106   HoC Science and Technology Committee, First Report of Session 2005-06. Meeting the UK Energy and Climate Needs: The Role of Carbon Capture and Storage, HC 576-1, p. 13. Back

107   Ev 5 Back

108   Q 55 Back

109   Q 58 Back

110   HoC Science and Technology Committee, First Report of Session 2005-06. Meeting the UK Energy and Climate Needs: The Role of Carbon Capture and Storage, HC 576-1, p29.  Back

111   Visit to the United States, Annex 1. Back

112   HoC Science and Technology Committee, First Report of Session 2005-06. Meeting the UK Energy and Climate Needs: The Role of Carbon Capture and Storage, HC 576-1, p29. Back

113   Q 511 Back

114   Q 510 Back

115   Q 510 Back

116   Q 510 Back

117   Welsh Assembly Government Energy Route Map, www.wales.gov.uk Back

118   Ev 197 Back

119   Ev 285 Back

120   Q 726 Back

121   Q 56 Back

122   Q 882 Back

123   Q 507 Back


 
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