Geoff Hiscock. Cleaning up the coal energy pillar a central task for Modi and Abbott

Nov 22, 2014

Narendra Modi and Tony Abbott explicitly defined energy as a “central pillar” of the India-Australia economic relationship in their joint statement this week.

That’s a good sign, but if they want to make a truly significant contribution to the long-term economic and social benefit of India and Australia, then they need to deliver forcefully and quickly on the commitment they made to work together on clean coal technology.

An emphasis on utility-scale carbon capture and storage (CCS) projects in India would be a good place to start. With 1.93 billion tonnes of carbon dioxide emissions last year (5.5 per cent of the global total), India does not yet match China’s massive 9.52 billion tonnes (27.1 per cent), but it is headed in the same direction and by 2025 could be the world’s biggest coal importer.  Much of that coal will come from Australia.

India has a large domestic coal industry, but it relies heavily on imported coal for its energy needs from Indonesia, Australia, South Africa and Kazakhstan. If the Modi-Abbott embrace holds true, then Australia is going to be an increasingly important energy supplier for India, both in thermal coal and liquefied natural gas (LNG).

Modi told his Australian audience that he wanted all Indians to have access to electricity generated in a way that “does not cause our glaciers to melt.”  While the opponents of coal see that as the go sign for renewables, the reality is that coal is not going to disappear from India’s energy equation any time soon. It now generates 60 per cent of Indian electricity, and while that share may fall to 50 per cent between 2025 and 2030, the actual volume of coal consumed will not decline, because most of India suffers from a power supply shortage.  Modi’s home state of Gujarat is one of the few parts of India with a power surplus – a result of Modi’s pro-business policies and his encouragement of groups such as Adani and Tata to build large coal-fired power stations there. He has also given strong backing to the solar power industry

But even with a substantial investment in domestic oil and gas, LNG imports, nuclear, hydro, solar and wind power, Modi knows that India will have to rely on coal-fired power stations for its electricity and industrial needs for years to come. It simply lacks the infrastructure, the smart technology, the time and the money to move too far from coal too soon.  To say that coal globally is in structural decline ignores the development aspirations of a multitude of nations.  India, for example, is still way behind China on the development path, and as many as 300 million of its 1.3 billion people lack access to the affordable, reliable power that coal can deliver.

The world has known for decades that coal carries a heavy environmental price – Europe and the US in the 1950s, Japan in the 1970s and China in the 2010s all bear the scars of coal-fired air pollution. But just as suphur dioxide has been cleaned from smoke stack emissions, so too can carbon dioxide be removed if the political will exists and the price to pay is deemed palatable. Carbon capture and storage (CCS) typically reduces a power plant’s efficiency by 8 to 10 per cent, according to the International Energy Agency. For India, just as it is for China, the big challenge is to maximise the efficiency of new coal-fired power stations to offset the losses that go with CCS.  The latest ultra-supercritical power stations have efficiency ratings of 44 per cent or better. Unfortunately, too many of the power plants built in Asia in the last two decades have still been in the subcritical range, with efficiency ratings of 28-38 per cent. The factors that determine a plant’s efficiency (apart from the quality of the coal and water) are pressure and temperature, and the ability of components such as boilers and turbine blades to withstand higher pressures and temperatures,

This is where Australian expertise in metallurgy, in power plant design, and in scrubbing carbon out of coal could be of great benefit to India, both economically and environmentally.  Increased washing of coal to improve efficiency, de-watering, steam-cleaning of flue gases and the use of a range of CCS options covering combustion, pulverisation and gas conversion are being tested around the world in demonstration plants and pilot projects. There is an urgent need to apply these carbon-cleaning measures to full-sized coal-fired power stations. That is starting to happen in North America through utility-scale CCS projects such as Boundary Dam in Canada and Petra Nova in the US, and will most probably happen in China from about 2016 onwards.

Early last year, New Delhi-based The Energy and Resources Institute (TERI) published a scoping study on the potential for CCS to mitigate India’s greenhouse gas emissions.  It pointed to a number of Indian CCS research projects in energy, petrochemicals and metals, in cooperation with countries such as Norway and the United States.  It said the barriers to CCS in India included the lack of accurate geological storage site data, the extra cost involved in using CCS, the “demonstration stage” nature of the technology and a lack of knowledge and capability among policy makers and regulators.  Other factors were financial risk for investors, lack of skilled labour and infrastructure, legal issues over land use, water contamination, CO2 leakage, and the cost- efficiency trade-off in retrofitting power plants with CCS measures.

It concluded that India’s top development priority was to provide electricity to all at affordable prices. Nonetheless, it said CCS work should continue with “sustained efforts … required towards capacity development of different stakeholders.”

The TERI report identifies the sort of work that needs to be done in India before CCS gets moving. Modi and Abbott should ensure the momentum generated by this week’s energy embrace does not get wasted.

Geoff Hiscock writes on international business and is the author of “Earth Wars: The Battle for Global Resources,” published by Wiley.

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