Leading in Low Emission Coal Melbourne, Victoria, Australia
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Take advantage of Victorian low emission coal opportunities
Energy decision makers around the world are closely watching low emission coal developments in Victoria – as local and international companies take advantage of unique opportunities to advance energy’s future technological solutions.
Low emission coal technologies remove, reduce or isolate the carbon pollutants associated with processing coal. This may be achieved through developing technologies and processes such as those to reduce the amount of carbon dioxide emitted during coal conversion or to capture carbon where carbon pollutants are isolated and placed in long term storage. Low emission coal technologies, including carbon capture and storage (CCS), are seen as a means to reduce greenhouse gas emissions arising from the use of coal.
The increasing scarcity and cost of energy sources such as oil and gas also presents opportunities for a new range of commodities and exports derived from brown coal, a resource that is a major contributor to Victoria’s economy.
Victoria – global leaders in low emission coal
Victoria – an Energy Hub
Emerging low emission coal technologies are developing rapidly in the Australian state of Victoria – a region at the international forefront of low emission coal power generation and carbon capture and storage advances.
Victoria is uniquely positioned to initiate and sustain innovation and creativity in low emission coal technologies. Victoria’s Latrobe Valley is a concentrated hub of energy activity. Its coal-fired power generators supply more than 90 per cent of Victoria’s electricity, servicing Australia’s largest energy market, which is expected to grow significantly over the next 20 years.
Nearby offshore geology in Bass Strait looks likely to provide an excellent site for carbon storage under the seabed. Decades of storage are available in this area’s depleted oil and gas fields. In addition, its deep saline aquifers are potentially large enough to secure several hundred years of carbon emissions.
CarbonNet – an emerging Carbon Capture and Storage Network
The Victorian Government vision for progressing Carbon Capture and Storage is based on the concept of the staged development of a multi-user foundation CCS network (CarbonNet), to support capture of CO2 emissions from electricity generation and new coal based industries in the Latrobe Valley, and transport and storage of the CO2 in Victoria’s world-class geological basins. The network approach offers Australia potentially the lowest cost, lowest risk pathway to commercial scale multi-emitter CCS deployment.
The program is designed to support the construction and demonstration of industrial-scale integrated carbon capture and storage projects in Australia, which may include gasification, post-combustion capture, oxy-firing, transport and storage technologies, designed to underpin Australia’s transition to a low-emission energy economy.
The Victorian Government seeks to leverage projects which will be supported under its Energy Technology Innovation Strategy (ETIS) CCS grants program, its research and developmentinitiatives, and private sector CCS investments.
A$29 million has already been committed towards the development of a multi-user CO2 capture, storage and transport system. This is being developed by a number of consortiums, nationally or internationally based. Capture technologies will be both pre and post combustion.
Victoria has invested heavily in one of the most progressive CCS enabling environments to date, and proposes to work with the Australian Government to create a world-class, industrial scale demonstration network providing a pathway through which private sector participation in CCS can be leveraged both initiallyand progressively for many years.
Government direct support for low emission coal
Through clear policy settings backed by significant funding, both the Victorian and Australian governments are supporting international and local groups working to advance carbon capture and storage in Victoria.
Support is focused on areas of strategic opportunity in the early stages of research-to-market and large demonstration of cutting edge technology where technical and market risk remains present.
The Victorian Government provides direct support for industry-led low emission coal technology development through ETIS.
Integrated Drying Gasification Combined Cycle (IDGCC)
Victorian energy technology company HRL is constructing the world’s largest commercial-scale low emission coal technology demonstration plant based on integrated drying gasification combined cycle technology. Construction of the Latrobe Valley plant is expected to begin in 2011 and will generate up to 600MW of power. Funding of A$50 million from the Victorian Government and A$100 million from the Commonwealth Government is supporting the A$1.1 billion project.
Brown coal drying, post-combustion carbon dioxidecapture and storage
The Victorian Government has committed A$110 million to drive new investment in pre-commercial carbon capture and storage technologies in partnership with industry, investors and technology developers. A total of A$29 million of this funding has been allocated to support the development of five projects.
The funding includes:
- Up to A$3.5 million to investigate the feasibility of building a small-scale plant at an existing brown coal power station that would capture and mineralise CO2 into materials to be used in the building industry. The project is being developed by Calera
- Up to A$2 million to investigate the feasibility of a large-scale, gasification, pre-combustion CO2 capture project being developed by TRUenergy and Southern Company
- Up to A$3.5 million to investigate the feasibility of a gasification, pre-combustion CO2 capture project being developed by HRL
- Up to A$1 million to investigate the feasibility of a retro-fitted large-scale, post-combustion carbon capture plant at Loy Yang A Power Station being developed by Loy Yang Power, Mitsubishi and TRUenergy.
- Up to A$19 million to investigate the feasibility of a large-scale storage and transport project being developed by Schlumberger, TRUenergy and Mitsubishi (LASSIE).
Many of the projects will be part of the Victorian Government’s CarbonNet initiative, for which the Commonwealth has approved funding for pre-feasibility work.
These projects are the first to receive money under the program. The remaining money in the A$110 million fund will be allocated to projects that successfully meet expectations.
The Victorian Government is also providing A$2 million towards a pre-feasibility study on gasification and pre-combustion capture, with an additional A$2 million being provided by the Commonwealth Government. This Nippon Steel Engineering project is also supported by the Japanese Government.
At a national level, the Australian Government has committed A$2.425 billion over nine years to fund the Carbon Capture and Storage Flagships Program, which forms part of the Government’s Clean Energy Initiative announced in the May 2009 Budget.
The Brumby Government’s proposal for Australia’s first carbon capture, transport and storage network, CarbonNet, is one of four projects to have been short listed by the Commonwealth Government under the CCS Flagships program. The five Victorian projects under CarbonNet have also received A$30.5 million of Commonwealth Government funding to support pre-feasibility studies.
Research and Development in Victoria
The Victorian Government has provided A$9.43 million for brown coal R&D grants for new applications and advanced low emission technologies associated with power generation, such as coal drying, carbon capture, oxy-fuel combustion, and efficiency improvement.
- A$2.06 million to the Co-operative Research Centre for Greenhouse Gas Technologies (CO2CRC) to test pre-combustion CO2 capture technologies in power generation
- A$2.5 million for CSIRO and CO2CRC to investigate and optimise technology options for post-combustion capture of CO2 from Victorian brown coal power stations at both Loy Yang A and Hazelwood power stations
- A$1.3million to Monash University to investigate oxy-fuel combustion with the potential for brown coal fired power stations to reach near zero emissions
- A$800,000 to AquEx to investigate dewatering brown coal under pressure
- A$550,000 to CSIRO Minerals for modelling dried brown coal power furnaces
- A$550,000 to Monash University to investigate the use of lignite to increase the effectiveness of separation of sludge from municipal water treatment plants
- A$525,000 to HRL Technology to improve the knowledge of advanced materials for power plants
- A$450,000 to HRL Technology to investigate advanced flaw detection in welds, pitting in tubes and turbine blades
- A$390,000 to HRL Technology to develop a boiler optimisation package to improve combustion efficiency and reduce CO2 emissions from combustion of brown coal
- A$300,000 to Monash University to investigate the key technical feasibility of a conceptual advanced gasification technology.
These grants have leveraged additional investment from other sources, such as the private sector and research institutions, to reach a total investment of $24 million.
Brown Coal Innovation Australia (BCIA)
The Victorian Government has recently awarded A$16 million for low emission coal research and to establish Brown Coal Innovation Australia (BCIA), an independent company to manage the funding. The BCIA Board has been appointed from industry and research organisations.
The BCIA will co-ordinate all brown coal R&D in Australia in conjunction with the Commonwealth’s Australian National Low Emissions Coal R&D organisation.
The BCIA will co-invest with industry and research entities in R&D projects in new high-quality brown coal technologies and in adaptation of existing low-emissions technologies to Australian brown coal.
By investing in these projects, the BCIA will advance technologies and develop and retain critical skills and knowledge required in the brown coal sector over the coming decades.
This funding and the establishment of BCIA will help to ensure that Victoria has the skills to deliver new technologies.
Carbon storage trial
Run by Australia’s Cooperative Research Centre for Greenhouse Gas Technologies (CO2CRC) and supported by the Victorian Government, this project demonstrates carbon storage on an industrial scale. Over 65,000 tonnes of compressed carbon dioxide has already been injected deep underground, with plans for further injections into different formations for monitoring and analysis.
Victoria – developing new opportunities for browncoal
Due to the rapid changes in global energy demand, rising oil prices and strengthening commodity markets, the opportunities for major investment in utilising Victoria’s brown coal have increased, not only for domestic markets, but also for the rapidly expanding markets in the Asia Pacific and beyond.
Technology to convert coal to liquid or gaseous fuels has been available in various forms since the 1920s but cost has rendered it uncompetitive. The new market dynamics for commodities such as diesel, urea, methanol and its derivatives, and the adoption of new low emission coal technologies are now providing opportunities for brown coal as a low cost feedstock to compete with traditional feedstocks (such as oil, gas and black coal) commonly used to produce these commodities.
In addition to opportunities to convert brown coal to tradable commodities, the adoption of suitable drying technologies is expected to enable brown coal to be exported in its own right and compete directly in black coal markets as an energy and feedstock resource. It is predicted that Victoria’s brown coal resources will have the following development pathway through the application of different technologies (Figure 1).
Potential products derived from brown coal
The following alternative products present exciting challenges and opportunities for Victorian coal.
Solid fuels and products
Brown coal in raw form can be used for boiler fuel in power generation. Value can be added with drying technologies to transform the product into high energy content briquettes and pellets that may compete with black coal as an exportable fuel.
Chars and cokes may potentially be derived from brown coal for pyrometallugical applications to produce reductants and carburising chemicals and as a general carbon source for other applications. Calcium loaded char has applications in water and waste treatment and as an ion-exchange medium.
In the future, brown coal may even be refined into a purer form of carbon for use in production of a myriad of carbon products including carbon fibres, carbon anodes, activated carbons, filter aids, pigments, graphite lubricants and conductors and formed carbon materials.
Coal Seam Methane
Coal Seam Methane (CSM), found naturally in coal seams, has potential use in the reticulated gas supply, for the generation of electricity and for the production of derivative products.
In Australia, CSM is extracted from black coal but can also be extracted from brown coal as has been done on a large scale in the United States (Powder River Basin).
Brown coal deposits in Victoria have potential for CSM extraction but exploration is required to test the potential productivity of reservoirs. Issues including coal porosity and groundwater extraction need to be considered in new developments.
Gaseous products and hydrogen
Gasification of coal to produce synthetic gas (syngas, a mixture of predominantly carbon monoxide, carbon dioxide and hydrogen), can convert solid coal into a gaseous feedstock that is a precursor to a range of other products (Figure 2). The process can also facilitate the separation and sequestration of carbon dioxide.
Victoria has had a long history of brown coal gasification – which provided town gas in the Latrobe Valley before natural gas from Bass Strait became available in the 1960s.
Hydrogen, one product that can be derived from syngas, has potential to be used directly as a fuel gas, in fuel cell technologies, stationary power production and for use in vehicles.
Underground coal gasification also has emerging potential to produce syngas and may be able to exploit low quality, economically un-mineable deeper coal seams by in-situ coal gasification (underground) with relatively low capital investment. For this process to become a viable large scale industry, issues surrounding the predictability and controllability of syngas for certain applications need to be managed, as do any potential environmental risks.
Figure 1: Development pathways for coal
Figure 2.
Liquid products
Liquid products from coal can be produced either from syngas via gasification or by the direct liquefaction of brown coal. Through the syngas pathway, liquid fuel products such as diesel, methanol, fuel gasoline blends, and high octane gasoline extenders can be produced (Figure 2).
The direct liquefaction pathway generally produces lower quality products such as synthetic crude oil which with further processing may be used to produce fuel oil, diesel, motor fuel blends, kerosene, heating oil etc. Non-fuel products may also be produced including solvents, polymers, surfactants, lubricants and a suite of other carbon-based chemicals.
Waxes, resins and polymers
A range of waxes may be produced using products derived from brown coal, as well as phenolic resins and plastics, composites, low strength structural and building materials.
Agricultural products
Raw brown coal can be used as a soil conditioner by providing a source of humus for potting mixtures and market gardens and as an admixture to other fertilisers and soil conditioners.
Syngas manufactured from coal can be used to produce ammonia, the key pre-curser to nitrogenous fertilisers. At present these fertilizers are more commonly made from oil and natural gas based feedstocks.
New technology research
In 2007-08, mining businesses expended more than A$176 million performing research and development in Victoria – which equates to 5.4 per cent of total R&D expenditure by mining businesses performing research in Australia and 4.5 per cent of total expenditure on research and development of all business in Victoria.
The Department of Primary Industries’ Energy Technology Innovation Division works alongside local and international industry partners, major research bodies, academia and investors to prepare these technologies for market uptake and commercialisation.
Looking to the future
Coal is abundant, affordable, available and reliable and is vital to the world’s sustainable energy needs. World energy demand, consumption and prices are dramatically increasing, as is the price of metallurgical and thermal coal.
With brown coal being integral to Victoria’s economy, the use of drying, gasification and liquefaction technologies will enable the State’s brown coal to be used to produce key commodities such as diesel, urea, petrochemicals and hydrogen, as well as exportable coal, and in so doing substitute for the conventional feedstocks such as oil, gas and black coal.
With support from the Victorian Government, these technologies, as well as carbon capture and storage opportunities, can open direct export markets for the State whilst ensuring reduced carbon emissions to meet the global greenhouse gas challenge.
For more information contact
Energy Technology Innovation Department of Primary Industries 1 Spring St (GPO Box 4440) Melbourne, Victoria, Australia 3001 Telephone: +61 3 9658 4193 Facsimile: +61 3 9658 4916 Email: dpi.etis@dpi.vic.gov.au
Website www.dpi.vic.gov.au/etis
To receive this publication in an accessible format email dpi.etis@dpi.vic.gov.au
Authorised by the Victorian Government, Melbourne © Copyright State of Victoria, August 2010
ISBN 978-1-74217-107-4 (print)ISBN 978-1-74217-108-1 (online)
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