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Natural Gas Price Signals End of Coal for China

Natural Gas price lures customers from coal

Natural Gas: Coal consumption in Beijing, China 2010-2017
China’s natural gas demand has been boosted by price cuts aimed at switching users from coal to the cleaner fuel. Image shows coal consumption in Beijing, China 2010-2017.

>>China’s gas demand expanded 3.3 percent in 2015, while coal consumption dropped 3.7 percent, declining for the second year, according to the National Bureau of Statistics.

>>Coal use will slip further this year amid tepid demand from industrial users, according to the China Coal Industry Association.

>>The country’s LNG imports in the first two months of 2016 jumped more than 14 percent and shipments by pipeline rose 15 percent to a record.

 

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Success at COP21! Now What?

by John Brian Shannon | December 14, 2015

Sincerest congratulations are due to the Conference of the Parties (COP21) for inking a remarkable agreement to limit global warming to 2 degrees by 2050/2100

It’s a global achievement, one that saw 200 countries come together in a unified purpose to protect our Commons.

By agreeing to unprecedented GHG emission targets at COP21 in Paris, world leaders have shown that our man-made problems aren’t above our ability to solve.

In short, our leaders are bigger than our problems — and that’s a very comforting sign indeed!

We’ve Got Our COP21 Targets. Now What?

As laudatory as all of that sounds, it begs the question, “Now that we’ve agreed on strict GHG limits, how do we actually set about achieving those limits?”

Listed in the order of maximum effect, irrespective of convenience, the following proposal must rank among the least costly ways to achieve our COP21 targets within the timeframe specified.

ONE: Eliminating coal-fired primary power generation (globally) by 2020

By far, global coal-fired power generation is the largest single contributor to greenhouse gas emissions, and aside from the obvious heavy CO2 load, many toxic gases are produced due to the impurities found in raw coal.

Things like mercury, heavy metals, sulfur and nitrogen when burned, become very toxic and scatter soot and noxious gases over hundreds of square miles, downwind from each coal-fired power station. Gases such as sulfur dioxide, oxides of nitrogen, and particulate matter (soot) are incredibly damaging to human life, livestock and wildlife, and to agriculture.

Not only that, but billions of dollars of damage to exterior metal and concrete occur every year due to the effects of coal-fired acid rain hitting everything from bridges to skyscrapers to outdoor art installations.

Read: Harvard Medicine | Full Lifecycle of Coal – Epstein et al

Almost worse, is the heavy water usage (to control coal dust migration and to lower the burn temperature at coal-fired power generation facilities) which average 1100 gallons per MegaWatt(MW) of electricity produced.

For the record, natural gas-fired power generation requires 300 gallons of water per MW, while nuclear power generation uses 800 gallons of water per MW and solar power and wind power generators use 0 gallons per MW.

Following the successful COP21 event, what are the next steps that will give us the ‘most bang for the buck’ as we pursue our CO2 reductions?
Following the successful COP21 event, what are the next steps that will give us the ‘most bang for the buck’ as we pursue our CO2 reductions?

Another serious problem in regards to coal burning is the disposal of millions of tons of toxic fly ash, which is the ashes left over from burning millions of tons of coal annually.

Each year, millions of tons of toxic fly ash must be cooled, transported tens or hundreds of miles away, and then buried deep underground far from aquifers.

TWO: That’s not to say that the coal industry should die. Far from it. Some of the purest liquid fuels on the planet are already made from coal by employing the Fischer-Tropsch process. Such fuels are known as CTL fuels (Coal-to-Liquid) fuels and are noted for their almost clinical purity

Some countries, notably South Africa, have been blending the very clean-burning CTL fuel (30%) with conventional petroleum-sourced gasoline (70%) since the 1950′s in order to create an exceptionally clean burning gasoline for use in cars and trucks. That mixture lowers CO2 and other GHG emissions by more than half with the potential for 50/50 CTL and gasoline blends in the future.

In addition to that, the aviation fuel ‘coal oil’ that is produced from South African coal — is purer and therefore cleaner-burning than conventional petroleum-sourced ‘kerosene’ aviation fuel.

Over 2% of the world’s CO2 emissions are produced by general aviation. By switching to a coal oil/kerosene blend, global aviation emissions would drop by half, or better.

We could decrease our automotive and aviation emissions by half thanks to coal! and instead of witnessing the death of the coal industry, we would witness a coal renaissance!

THREE: All coal-fired power generation over 1MW should be switched to natural gas which upgrade is known as Coal to Gas (CTG). It’s already a mature business model in the U.S. where many coal-fired power plants have been converted to natural gas in order to meet the increasingly stringent air quality standards proposed at COP21

The benefits of this are quite obvious. All of the infrastructure is already in place to deliver the electricity from the existing power plant to demand centres.

Natural gas-fired power generation (thermal) operates similarly and can use the same facilities as coal-fired power generation.

Natural gas burns up to 1,000,000 times cleaner than the lowest quality brown coal (lignite) and up to 10,000 times cleaner than the highest quality black coal (anthracite).

The news gets even better for aquatic life as natural gas uses only 300 gallons per MW — and there is no black, coal-dust-laden water pouring into ditches, streams and rivers downstream from coal mines, coal-fired power stations, and along the thousands of miles of railway tracks that transport coal.

The bigger the natural gas market, the lower the per unit price for natural gas. Until now, natural gas-fired power generation has been used to add expensive ‘peaking power’ to the grid as it can ramp up quickly to provide additional power during peak demand sessions, such as when many air conditioning units suddenly switch-on in the afternoon.

However, as more coal power stations have converted to natural gas, the (Henry Hub) spot price for natural gas has lowered accordingly. We’re now seeing natural gas prices falling to historic lows (under $2.00) due to increased baseload demand.

FOUR: As great as it is to add biofuel to transportation fuels in order to help them become (much) more clean-burning, all ethanol that is obtained *from corn* must be stopped by 2020

By a significant margin, corn is the worst plant to grow in order to produce biofuel due to the obscene water and pesticide use required to grow corn.

Corn must be replaced with a less demanding crop such as sugarcane. In Brazil, sugarcane is grown for sugar (primarily) and biofuel (secondarily) and the technology has advanced to the point where even the leaves and roots of the plant (the ‘stover’) are used to produce biofuel via the cellulosic biofuel process.

In Brazil, by law, a minimum of 24% of each gallon of gasoline must be bio-ethanol sourced. Costa Rica and some other Latin countries have advanced bio-ethanol programmes and likewise show corresponding drops in vehicle emissions.

Other crops, such as sweet sorghum are even more promising than sugarcane and are only a few years away from making a massive impact as an ethanol feedstock.

By banning corn for biofuel use and replacing it with sugarcane or sweet sorghum, water usage levels would fall by billions of gallons per state, annually. Pesticide use, land management and other environmentally costly processes would be dramatically minimized.

Every gallon of gasoline that is sold in the world should have a 50% biofuel or CTL component and it should be noted that CTL fuels are just as clean-burning as ethanol derived from biofuel crops such as sugarcane or sweet sorghum.

FIVE: The shipping industry produces about 2% of the world’s emissions only because old ships burn incredibly toxic bunker fuel, while newer ships burn clean natural gas. Regulating global shipping to upgrade to natural gas can dramatically lower emission levels across the industry

If bunker-fuel-burning ships (‘old clunkers’) are no longer allowed in the world’s ports, they will be useless to their owners and will be sold for their scrap metal value.

By recognizing that our use of coal must change by 2020 we can employ natural gas in place of coal for our primary power generation — while adding CTL fuels and 2nd-generation biofuels to our transportation fuel — for a ‘cleaner burn’ to meet our electricity and transportation energy needs while easily meeting our COP21 emission reduction goals.

Renewable Energy & Natural Gas Powered Electric Grids

by John Brian Shannon | February 22, 2015

Clean (Renewable Energy) + Clean-Burn (Natural Gas) = ENERGY (The Way it Should Be!)

Planetary energy graphic courtesy of Perez and Perez.
Planetary energy graphic courtesy of Perez and Perez.

Of all the energy that is available to us, solar energy is by far the most available and the most evenly distributed energy resource on planet Earth.

Wind and Solar + natural gas = Synergy

  • Solar is available every day. But not at night.
  • Wind is available day and night, but it can produce variable power levels as the wind blows over the landscape.
  • Offshore wind turbines produce constant power, spinning relentlessly for years at a time — except when an operator locks the blades during large storms or the annual inspection.

Both solar power and wind power face varying ‘intermittency‘ — which requires the use of ‘peaking power plants‘ or ‘load following’ power plants — to meet total demand.

All electrical power generators are interdependent

How electricity grids use different power generators to meet total and constantly changing electricity demand.

In the case of renewable energy, the negatives include some variability in the total output of solar power or wind power generation due to temporary cloud cover or storms. At such times, natural gas-fired generation can ramp-up to cover any shortfall.

Note: This is a common and daily energy grid practice whether renewable energy is involved or not. Some gas-fired power plants are called peaking power plants which quickly ramp-up to meet output shortfalls. In fact, peaking power plants (which are almost always gas-fired) were created to meet temporary shortfalls — and were in widespread use long before renewable energy ever hit the market.

Also in the case of renewable energy, another negative is that the Sun disappears at night and solar panels stop contributing to the grid. And unless you have offshore wind turbines to make up the shortfall, onshore wind turbines may fall short of total demand. So at night, you need reliable power to make up shortfalls in primary generation.

Note: This is a common and daily energy grid practice whether renewable energy is involved or not. To cover this situation load following power plants were designed to meet larger output shortfalls. In fact, load following power plants were created to meet larger, daily, shortfalls — and were in widespread use long before renewable energy ever hit the market.

In the case of natural gas, the negative is that gas is subject to wild price fluctuations, potentially making gas-fired generation very expensive. Which is why natural gas-fired generation evolved into peaking power, less often in the load-following role, and almost never as a baseload power generator.

The other negative associated with natural gas is of course, the fact that gas turbines create CO2. That we can deal with — unlike coal, where the CO2 portion of the coal emissions are the least of our worries — as coal emissions are loaded with heavy metals, soot, and other airborne toxins.

How can we deal with the CO2 emitted by gas-fired power plants?

As gas-fired peaking power plants typically fire up anywhere from a couple of dozen hours annually, to a few hours of every day (usually to cover the additional load of many air conditioners suddenly switching on during hot summer days) we aren’t talking about a whole lot of CO2.

Gas-fired load-following power plants typically run for a few hours every day and to cover demand in case of primary generator (like hydro-electric or nuclear power plant) maintenance. In the case of load-following plants, much more CO2 is produced annually.

Carbon Capture and Sequestration (CCS) of gas-fired CO2 emissions via tree planting

  • Peaking power plants operate for a few hours per year. We’re not talking that much CO2.
  • Load-following power plants operate for many hours per year. More CO2.

But still, each mature tree absorbs (a low average of) 1 ton of CO2 from the atmosphere and keeps it in storage for many decades. Some trees, like the ancient Sequoia trees in California, are 3700 years old and store 26 tons of CO2 each! Certain trees native to Australia store even more carbon and live longer than Sequoia trees.

And, as anyone who has worked in the forest industry knows; Once that first planting hits maturity they begin dropping their yearly seeds. Some trees like the cottonwood tree produce 1 million seeds annually. American Elm trees set 5 million seeds per year. More trees. Always good.

It’s an easy calculation: “How many tons of CO2 did ‘ABC’ gas-fired power plant output last year?”
Therefore: “How many trees do we need to plant, in order to cover those emissions?”

Simply plant a corresponding number of trees and presto! gas-fired generation is carbon neutral

By calculating how many tons each gas-fired peaking power plant contributes and planting enough trees each year to cover their CO2 contribution, tree planting could allow gas-fired power plants to become as carbon neutral as solar power or wind power.

The total number of trees that we would need to plant in order to draw gas-fired peaking power plant CO2 emissions down to zero would be a relatively small number, per local power plant.

By calculating how many tons each gas-fired load-following power plant contributes and planting enough trees annually to cover their CO2 contribution they too could become just as carbon neutral as solar panels or wind turbines. Many more trees, but still doable and a simple solution!

The total number of trees that we would need to plant in order to draw gas-fired load-following power plant CO2 emissions down to zero would be a much larger number. But not an impossible number.

So now is the time to get kids involved as part of their scholastic environmental studies, planting trees one day per month for the entire school year.

Let the gas-fired power plant operators contribute the tree seedlings as part of their media message that the local gas-fired power plant is completely carbon neutral (ta-da!) due to the combined forces of the power plant operator, the natural carbon storage attributes of trees, and students.

Up to one million trees could be planted annually if every school (all grades) in North America contributed to the effort — thereby sequestering an amount of CO2 equal to, or greater than, all gas-fired generation on the continent.

It’s so simple when you want something to work. Hallelujah!

Baseload, peaking, and load-following power plants

Historically, natural gas was too expensive to used in baseload power plants due to the wildly fluctuating natural gas pricing and high distribution costs, but it is in wide use around the world in the peaking power plant role, and less often, in the load following power plant role.

Renewable energy power plants can be linked to ‘peaking’ or ‘load-following’ natural gas-fired power plants to assure uninterrupted power flows.

  • Peaking power plants operate only during times of peak demand.
  • In countries with widespread air conditioning, demand peaks around the middle of the afternoon, so a typical peaking power plant may start up a couple of hours before this point and shut down a couple of hours after.
  • However, the duration of operation for peaking plants varies from a good portion of every day to a couple dozen hours per year.
  • Peaking power plants include hydroelectric and gas turbine power plants. Many gas turbine power plants can be fueled with natural gas or diesel. — Wikipedia

Using natural gas for baseload power

Natural gas has some strong points in its favour. Often it is the case that we can tap into existing underground gas reservoirs by simply drilling a pipe into naturally occurring caverns in the Earth which filled with natural gas over many millions of years. In such cases, all that is required is some minor processing to remove impurities and adding some moisture and CO2 to enable safe transport.

It’s the natural gas market pricing system that prevents gas from becoming anything other than a stopgap energy generator (peaking or load-following) and almost never a baseload energy generator.

Let’s look at local solutions to that problem.

Waste-to-Fuels

Several corporations are working with local governments to find innovative ways to capture landfill methane gas to produce electricity from it.

Keep in mind that the methane gas that escapes from every single landfill in the world (whether still operating or having ceased operations long ago) is 23 times more damaging to the atmosphere than CO2.

Increasingly, landfills are now installing perforated pipes underground which draw the landfill gas (so-called ‘swamp methane’) to an on-site processing facility. It is a low-grade gas which is sometimes blended with conventional natural gas to create an effective transportation or power generation fuel. Visit the Caterpillar Gas Power Solutions website here.

Waste Management is a global leader in the implementation of this technology, using its own landfills and municipal landfills across North America to produce over 550 megawatts of electricity, which is enough to power more than 440,000 homes. This amount of energy is equivalent to offsetting over 2.2 million tons of coal per year. Many more similar operations are under construction as you read this. Read the Waste Management landfill bioreactor brochure (downloadable PDF) here.

Durban, South Africa, a city of 3.5 million people, has created a huge Waste-to-Fuel landfill power plant that provides electricity to more than 5000 nearby homes.

Durban Solid Waste receives 4000 tons of trash each weekday which produces some 2600 cubic metres of gas every day of the year.

The GE Clean Cycle Waste-to-Fuel power plant arrives in 4 large shipping containers, and once connected to the gas supply pipeline it is ready to power nearby buildings and to sell surplus power to the grid.

One GE Clean Cycle Waste-to-Fuel power plant unit can generate 1 million kWh per year from waste heat and avoid more than 350 metric tons of CO2 per year, equivalent to the emissions of almost 200 cars.

Blending Conventional Natural Gas with Landfill Gas

As conventional natural gas is expensive (and much of the cost is associated with transportation of the gas over long distances) when we blend it 50/50 with landfill gas, we drop the cost of the gas by half. Thereby making blended natural gas (from two very different sources) more competitive as a power generation fuel.

By blending conventional natural gas 50/50 with landfill gas; We could produce baseload power with it — but more likely than that, we could use it to produce reasonably-priced load-following or peaking power to augment existing and future renewable energy power plants — rather than allow all that raw methane from landfills to escape into the atmosphere.

Best of Both Worlds — Renewable Energy and Natural Gas

Partnering renewable energy with natural gas in this way allows each type of power generator to work to their best strength — while countering negatives associated with either renewable energy or natural gas.

Renewable power generation and lower cost natural gas can work together to make coal-fired electrical power generation obsolete and accelerate progress toward our clean air goals.


Related Articles:

Success at COP21! Now What?
By agreeing to unprecedented GHG emission targets at COP21 in Paris, world leaders have shown that our man-made problems aren’t above our ability to solve.


Royal Dutch Shell New Lens Scenarios
Our latest scenarios explore two possible versions of the future seen through fresh “lenses” to take us to the year 2100.


BP Energy Outlook 2035
This edition updates our view of the likely path of global energy markets to 2035.

 

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