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Coal Doesn't Have to Be a Dirty Word, CEOs Say

Posted on: Friday, 15 February 2008, 06:05 CST

Coal is no longer an ugly, dirty stepchild in the shadow of oil and natural gas now that the world faces unrelenting electricity demand growth in emerging nations including China and India, which are gobbling up the abundant fuel.

But coal's environmental issues often overshadow perceptions of its value at home, where it is the one fossil fuel America has more of than anyone else.

Cleaned up with technology that shrinks carbon dioxide emissions or stores the gas underground, "we believe black is the new green," the CEO of the nation's largest private-sector coal company told energy executives Thursday at the Cambridge Energy Research Associates conference in Houston.

Carbon dioxide is the main greenhouse gas linked to climate change.

Citing statistics from the Energy Department's Energy Information Administration, Peabody Energy CEO Greg Boyce said coal demand has grown by 40 percent in the last 25 years and is expected to accelerate in the next quarter century, led by coal use in emerging economies.

He said China, which became a net importer of coal in mid-2007, added the equivalent of the United Kingdom's grid in coal generation last year after adding nearly that much in 2006. India's coal demand is expected to double by 2030, Boyce said.

The U.S. has the largest coal reserves in the world -- 27 percent of the total -- and can help satisfy growing domestic and international demand, he said. By contrast, other nations control most of the world's oil and natural gas reserves.

Boyce noted that coal must be part of a diverse energy universe to satisfy worldwide demand. Oil is essential, but access to it is shrinking.

Nuclear power is important, but it draws opposition from populations that don't want reactors nearby, he said.

Renewables, including hydroelectric, wind and solar, "absolutely make sense," Boyce said, "but I'm not aware of any new dams being built, and even wind farms can have opposition."

Meanwhile, coal generates more than half of the nation's electric power.

To replace it with other sources, Boyce said, would require 4,000 times more solar power; 75 times more wind turbines; 250 more nuclear plants; or five more Hoover Dams.

Joe Craft, president and CEO of Alliance Resource Partners, an underground coal mining company, said in a separate session about the future of coal that it's easy to tap and costs less to access and produce than other fuel sources.

Like Boyce, he said he believes the major concerns about coal center on climate change and possible legislation on the capture and underground injection -- or "sequestration" -- of carbon emissions.

"The question now is, in the future, will it maintain its low-cost status?" Craft said.

Other experts described technologies that can reduce coal's CO2 emissions.

Before combustion in a power plant, coal can be converted to a gas that will burn more efficiently. Such gasification technology has been used for years, but not widely, though several such projects are being planned.

Carbon dioxide can be captured after combustion by scrubbers in smokestacks that use a solvent to remove the gas and then separate the solvent and the CO2.

The solvent can be reused, and the captured CO2 can be sold to oil companies that inject it into the ground to force more oil from reservoirs.

Amy Ericson, vice president of global strategic operations at Alstom, a French transport and energy infrastructure company, said new plants can contain such carbon-capture technologies with planning.

"It doesn't require some preinvestment -- it just requires some preintelligence," she said.

Mike Mudd, CEO of the FutureGen Alliance, a project to construct what is billed as an essentially emissions-free coal power plant in Illinois, said the government needs to support ventures into such technology because the cost remains unknown, particularly when the industry expects carbon-capture legislation to be forthcoming.

Last December, the Energy Department pulled out of its commitment to fund most of the $1.8 billion FutureGen plant, citing rising costs. It had been budgeted at $950 million.

Mudd said the project emerged after the federal government implored the industry five years ago to address the need to remove carbon emissions.

The alliance was formed as a nonprofit organization so it could take risks with carbon capture technology that corporations, mindful of shareholders, may be reluctant to take on because of cost, he said.

Notwithstanding the government's pullout, the project should go forward to demonstrate how it works and gain public acceptance before carbon capture and sequestration will be commercialized, Mudd said.

If FutureGen breaks ground in 2009, it can start operation in 2012.

A second plant could start in 2017 and a third in 2018. By 2019, the technology could be tested and shown to be ready for the marketplace, Mudd said.

"The only way we can understand the cost of technology is by doing it," he said.

"At the end of the day, the prize is 90 percent of carbon capture."

Boyce echoed the call for greater use of clean coal technologies as well as development of more.

"America's most abundant energy source can be developed in a climate-friendly way," Boyce said.

Source: Houston Chronicle

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