Power Focused Costs and Emissions

To this point, the chapter has focused on the production of liquid transportation fuels, and the net power was sold to the grid at a fixed price; this is a fuel producer view. Another approach is to look at the OT configurations as power producers would, and sell the fuel at the market price. The U.S. has about 314 GW of PC capacity which is mostly mid-size subcritical units that are paid off and reaching the end of their life. They have an average efficiency of 33% and a generating cost of about $26/MWe-h for coal at $1.50/million Btu (Table 2.4). Simbeck and Pooritat [42] estimated the cost of power from a paid-off plant at $33/MWe-h for a coal cost of $2.00/million Btu, consistent with the Chap. 2 estimate. They also estimated the cost of electricity for an amine retrofit to be $90/MWe-h and for an IGCC-CCS rebuild to be $105/MWe-h [42]. Figure 3.14 shows that the CO2 capture options are economically unattractive without a very high CO2eq price and that a paid-off sub-critical PC would be economically justified to continue to operate and just pay the tax until the price of CO2eq reaches about $80/tonne CO2eq. These are exceedingly high hurdles for coal-based power to overcome, and it suggests that few if any paid-off coal plants would be modified or retired for a long time, even though these are a major contributor to global CO2eq emissions. This is particularly true for developed-world coal-based power generation fleet because few new coal plants will be built to meet demand growth, and CO2 emissions reduction must be address the existing plants. In the developing world with electricity demand growing rapidly and new coal plants being built, the CO2eq price that would drive the plant technology choice for new-build units from venting technology to capture technology is about half of that or about $40/tonne CO2eq (Table 2.4).

Fig. 3.14 Cost of electricity as a function of GHG price for paid-off subcritical PC and for CO2 capture amine retrofit of a subcritical PC and for a rebuild with an IGCC with CCS

GHG Emissions Price, $/tonne C02eq

Fig. 3.15 Electricity cost as a function of CO price for coal-based generation and for CTL-OT and CBTL-OT options selling the fuels produced into a fuel market with $100/barrel crude price

GHG Emissions Price, $/tonne C02eq

Fig. 3.15 Electricity cost as a function of CO price for coal-based generation and for CTL-OT and CBTL-OT options selling the fuels produced into a fuel market with $100/barrel crude price

Figure 3.15 compares the COE for the three coal-based generating options discussed in Fig. 3.14 with the COE produced by CTL-OT-CCS and two CBTL-OT-CCS options. The transportation fuel produced by these OT options (fuels plus electricity) was sold at market price expected for a crude oil cost of $100/bbl. The figure shows that the electricity produced by these OT options is much cheaper than that for the retrofit or rebuild options at all CO2eq prices. Furthermore, the CO2eq price at which these options become competitive with the paid-off subcritical PC plant is below $30/tonne CO2eq. The COE for the OT options is dependent on the crude oil price, and for $80/bbl the COE produced is ~$93/MWe-h at zero CO2eq price, i.e. comparable to that for the retrofit and rebuild cases. However, the COE price of the OT options decrease with increasing CO2eq price so that at a low CO2eq price (less than $20/tonne CO2eq), the OT technologies are economically favored.

Because in most electricity markets, power generators bid into the dispatch market; and in this market, generators will bid down to their minimum dispatch cost which is where their revenue equals their short run cost. Under these conditions OT systems such as CBTL-OT-CCS have two sources of income and can bid sufficiently low that they can defend high capacity factors and force competitors to lower capacity factors. Under these conditions, CBTL-OT-CCS should be able to defend high capacity factors with crude oil prices below $60/bbl at zero CO2eq price. At low, but expected CO2eq prices and expected crude oil prices, CBTL should be the clear choice on an economic basis [40].

CBTL-OT-CCS offers strategic potential to reduce CO2 emissions from subcritical PC units. For a biomass availability of one million tonnes (dry)/year and feeding 40% ( energy basis) biomass with coal, the CBTL unit would export about 275 MWe to the grid and produce 8,100 bbl/day of transportation fuel (Table 3.6). This is about the generating capacity of a typical subcritical PC generating unit. With CCS, the CBTL-OT unit would replace the generating capacity of the PC unit with decarbonized (zero carbon) electricity. In addition it would produce 8,100 bbl/day of zero carbon transportation fuels, addressing CO2 reduction in both the power sector and the transportation sector. This technology option requires careful consideration.

A rough thought experiment suggests that applying CBTL-OT technology to 450 million (dry)tonnes/year of biomass [17] combined with 400 million (AR) tonnes of coal could produce about 3.3 million bbl per day (50 billion gallons/year) of carbon-free gasoline energy-equivalent liquid transportation fuel and provide about 100 GW of decarbonized base-load generating capacity. With increased light duty vehicle (LDV) efficiency this could significantly reduce petroleum imports and significantly reduce LDV CO2 emissions. This could decarbonize about 30% of the U.S. power generated by coal if it were built as retrofits at existing PC plants or built separately, replacing coal-based electricity. CBTL in the recycle mode would be able to generate about four million bbl/day (60 billion gallons/year) of gasoline equivalent transportation fuels, but less electricity. The cost of CO2 avoided is much less than projections of the carbon price required to achieve stabilization [41]. If siting and other considerations reduced the amount of biomass that could actually be used by one half, this still clearly represents an important technology option for reducing CO2 emissions from power generation and from the transportation sector. Furthermore, this also appears to be the lowest cost option to achieving each of these objectives.

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