Economy and Environment and Utilities and Technology

Eco groups divided over gasification: New power plant has many critics, but some say it's a necessary step

September 15, 2008

One might think a technology promising greener electric generation would please most environmentalists.

Duke Energy Corp.'s 630-megawatt coal-gasification plant, scheduled to go online in Edwardsport in 2012, is expected to emit less sulfur dioxide, nitrogen oxides and particulates than the smaller, 1940s-era plant it replaces-while generating 10 times as much electricity.

However, more than a dozen Indiana and national advocacy groups are decrying the $2.3 billion plant being footed mostly by ratepayers, claiming it will raise emissions of greenhouse gas carbon dioxide more than 700 percent. They're even more dubious of plans to pump the carbon for untold millions of dollars into underground formations-a process known as carbon capture and sequestration, or CCS.

And that's not even counting their angst reflected in filings with the state utility commission over an additional $365 million Duke said it will need on just the generating plant itself.

They've even compared it-in a figurative groin kick to Duke-to Marble Hill, the $7.1 billion nuclear plant Duke's Indiana predecessor, Public Service of Indiana, abandoned in 1984 near Washington after cost overruns.

"Approving the new cost estimates for the Edwardsport project and not at least putting the project on hold until carbon capture and sequestration is proven, is equal to the approval of the failed Marble Hill plant," Grant S. Smith, executive director of Citizens Action Coalition, warned the Indiana Utility Regulatory Commission in July. CAC embraces renewable energy sources such as wind and solar power, and greater electric efficiency efforts.

But not so fast, say other environmental groups who've been largely out-shouted in the debate over gasification.

"I think it's irresponsible, frankly, to oppose the Duke plant," said John Thompson, director of the Coal Transition Project of the Clean Air Task Force, a Boston-based not-for-profit focusing on reducing pollution from coal plants. It seeks an 80-percent cut in U.S. emissions of carbon dioxide by 2050.

Thompson walks in step with other environmental advocates urging more deployment of wind power and

other renewable power technologies.

"It doesn't mean we don't do wind, but it doesn't mean we don't hold programs on coal hostage until we proceed with wind," Thompson said.

In the short term, wind power cannot be rolled out fast enough to displace large quantities of coal-generated electricity, he added. Even if Indiana's electric output of about 95 percent of megawatt hours generated by coal could be slashed to 70 percent, courtesy of renewable power, "that 70 percent is still going to kill us," Thompson said.

While alternative power is being developed, something must be done to alleviate carbon dioxide emissions, he said. Otherwise, "everything the environmental and conservationist movement has tried to achieve in the last 200 years in this country is threatened to be wiped out by global warming," Thompson said. "Everything that's been done since John Muir and John James Audubon is out the window."

Simply put, "there's no rapid transition [from coal] in the next 10 to 20 years," said John Goss, executive director of the Indi- ana Wildlife Federation, a 1,600-member group with 54 local conservation clubs in the state.

His group, like Citizens Action Coalition and others, is also concerned about rising costs for coal gasification and sequestration. But Goss said he still believes gasification, with carbon capture and storage, is the "quantum leap" needed.

"I believe it will be extremely difficult for Indiana to ever build a conventional coal plant again," he said.

Thompson said carbon dioxide emissions worldwide are on the scale of "gigatons" and "sequestration is one of the only technologies out there right now that can be deployed in that kind of scale."

Old, new technology

Gasification is relatively old technology used in various industrial processes such as in making fertilizer, while CCS is still evolving.

In a conventional power plant, coal is burned to produce heat that powers steam turbines that turn electric generators. The considerable pollutants from coal are cleaned up in the back end of the process, before heading out smokestacks. Duke, for example, just spent more than $1 billion on scrubbers to remove sulfur.

Gasification is not combustion, per se-more like oxidation. A slurry of finely ground coal, along with oxygen, is injected into a vessel at high pressures and temperatures exceeding 1,500 degrees. That creates a chemical reaction that yields synthetic gas, which is then cleaned of sulfur, mercury and other pollutants.

Duke estimates the process can remove 99 percent of sulfur at this point. The dirty part of the gas, like sulfur, can be sold for various industrial uses.

Gasification is ideal for Indiana's relatively high-sulfur coal, said Mike Womack, Duke Energy's vice president of major projects in the Midwest.

"It loves what we would normally call 'low-value' coals," he said. "The process works better if there's a level of sulfur higher than normal. It allows us to use a cheaper brand of coal."

The cleaned gas is burned in gas turbines to generate electricity. The hot gas from turbines can be used to generate additional steam to make more electricity.

At the gasification stage, it's easier and cheaper to remove the carbon dioxide for disposal-capturing and compressing the gas in a liquid form. Duke estimates it will cost half as much per ton to remove carbon at its new Edwardsport plant than at a conventional generating plant.

That's important for the disposal of carbon dioxide, known as carbon sequestration. Duke is investigating whether it could be injected deep into underground formations, saying the geological features under Edwardsport look promising.

How much it will cost to thoroughly study, let alone actually build, sequestration infrastructure is unclear at the moment. So is how much it will add to ratepayer bills.

The CAC's Smith cited to state regulators some data suggesting carbon capture and sequestration could result in a doubling of plant costs and an electricity price increase of 20 percent.

He also said carbon capture and storage process could gobble up 10 percent to 40 percent of energy produced by the power plant-rendering it more inefficient.

"At a minimum, the commission should order Duke put the Edwardsport project on hold until after Duke can demonstrate that it can technically and economically capture and sequester carbon sufficiently to, at a minimum, prevent any increase in system carbon emissions," Smith told the commission.

Duke noted that it was awarded a $1 million U.S. Department of Energy grant to study carbon capture and sequestration near the plant site. It also cites data from the Indiana Geological Survey that estimates 46 billion tons of carbon dioxide storage capacity in western and southern Indiana.

Duke Energy Chairman James Rogers, at a state energy conference in Indianapolis this month, said the company is learning more about CCS in pilot tests at three industrial-scale projects, including one by Canadian energy company EnCana that shoots up to 5,000 tons of carbon dioxide per day from a North Dakota gasification plant into an oil well to help improve oil recovery.

EnCana estimates that 99 percent of the carbon dioxide should remain underground for at least 5,000 years.

Rogers also said carbon capture and storage could be accelerated nationwide by a federal tax on electricity-a $3 average annual increase in electric bills generating perhaps $11 billion a year nationwide.

Cost debate

To Grant Smith, that's another troubling sign for gasification and storage. Duke customer bills were already projected to rise 18 percent through 2012 for the initial price of the Edwardsport plant, plus an additional 2 percent for the recently announced cost increase.

Duke is also getting $460 million in state, local and federal grants. Duke shareholders won't be sacrificing while ratepayers and Indiana's economy suffers, Smith argued

"The only way they could build the plant was because they got subsidies," Smith said. "With these guys, it's always other people's money."

But the Clean Air Task Force's Thompson said there's another way to look at it. Ditch coal for cleaner-burning natural gas and there's natural gas's price volatility to contend with. Nuclear energy is inherently expensive. And rolling out wind energy and other renewable forms of generation will still cost vast amounts of money.

"You're going to be raising the cost of energy across the globe by trillions of dollars," he said.

But, as is common in the energy debate, nothing is quite that simple.

Smith sees an economic boon from renewable generation and from energy efficiency.

"You're talking about millions of [new] jobs nationwide," he said.

Indiana's coal industry is a relatively pipsqueak part of the state's economy, others note. While construction employment could peak at 2,000 during the Duke plant construction, according to the utility, those jobs are temporary. The plant itself is expected to employ fewer than 100 people.

Smith noted that various utilities and energy companies have committed to building wind turbines in the northern part of the state capable of producing 1,000 megawatts-even more than the massive Edwardsport plant.

But others point out that it's unlikely those turbines could produce anywhere near that amount of electricity at a given point in time, because of wind's intermittent nature. Experts say only 5 percent to 25 percent of wind may be available at any one time.

Another problem with wind is it tends to blow least when it's needed most, during peak summer periods when air-conditioners are running full tilt.

Experts say prospects for wind will improve with power-storage breakthroughs.

Douglas Gotham, head of Purdue University's State Utility Forecasting Group, said wind also could become more viable as wind farms become more geographically diversified: more turbines becoming available to offset others where wind is not blowing at that moment.

"We support wind. We think wind is great," Thompson said. But without first dealing with carbon dioxide produced by the world's hundreds of coal-fired power plants, "We're not going to recognize the world climate in 20 to 50 years from now."
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