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Combustion Industry News
Date posted:
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Post Author
Patrick LaveryCombustion Industry News Editor
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Business Trends
Chinese firms have been looking to step up their involvement in Latin America, building upon their resource sector businesses to begin to supply power generation equipment and other heavy industrial goods, according to The Wall Street Journal. The moves are analogous to Chinese expansion into Africa, and there is concern that Chinese labour might be imported into Latin America in place of local labour, and that locally made goods might also face strong competition. Balancing this is a welcoming of foreign investment into the region, and it is hoped that, in contrast to the expansion into Africa, participation in a wider spectrum of the economy (by including the industrial sector) will ease tensions.
Japan’s government has announced a new policy to phase out nuclear power in the country by 2030. The 2011 Fukushima nuclear disaster is a key driver of the move, which is opposed by many industry groups but supported by a range of community and environmental groups. The previous energy strategy of the country had involved increasing the share of nuclear in the country’s power generation, making the policy shift a major one. The move would mean an increased reliance on fossil fuels, a larger role for renewables, and a heightened push for energy efficiency. However, as the current government could face an election this year, and is rather unpopular, a new government, which could alter the policy upon election, is a distinct possibility.
The Wall Street Journal has carried a report on the continuing mothballing of coal-fired plants in the US. The trend began in 2008, when shale gas production began its rise, making natural gas-fired plants economically more attractive, and has gradually affected more economical coal-fired plants. The production price of gas-fired energy currently stands at around $US 0.02/kilowatt-hour (€0.016/kilowatt-hour), half the price of many coal-fired plants, which also typically require more labour than gas-fired plants. FirstEnergy’s Sammis coal-fired plant, which has had $US 1.8 billion/€1.46 billion spent on environmental control upgrades in recent years, and is situated close to coal reserves, is one facing mothballing. It currently runs only to meet peak loads. Analysts predict the mothballing trend to continue.
The Californian carbon market has been projected as being short of carbon offset credits by around 29 per cent in its pilot 2013-2014 period, according to the American Carbon Registry. There are currently four approved offset project types – forestry, urban forestry, ozone depleting substances and agricultural methane – but these are seen as not enough. To meet obligations in the Californian system, companies will be able to reduce their emissions, buy emissions permits, or buy offset credits (which can be used to cover up to 8 per cent of their obligations). Emissions permits are currently trading at around $US 16/tonne (€12.96/tonne), while offset permits trade at around $US 12/tonne (€9.72/tonne). Suggested additional project types are pneumatic valve leakage reduction, coal mine methane, rice management, fertiliser management and avoided deforestation, though the first of these has already been ruled out. With the current four project types, it is estimated that by the 2018-2020 phase of the system, there could be a dearth of 67 per cent of offset credits.
Legislation and Regulation
In late August, the U.S Court of Appeals for the District of Columbia Circuit, which has federal jurisdiction, made void the US Environmental Protection Agency’s Cross-State Air Pollution Rule, which had been put in place by the Obama administration. The rule was aimed at forcing power plants emitting NOx and SOx that travelled to other states to limit their emissions (by running less often or shutting down) if they did not pay for credits to offset the pollution. The reasoning behind the court’s ruling was that it exceeded the EPA’s statutory authority to pass such a rule. The previous Bush administration had instituted a cross-state permit trading system, but August’s ruling did not invalidate it.
Research, Development and Technology
Researchers at the Korean Institute of Energy Research have developed a new carbon capture technology which they say is the most energy efficient in the world. The technology, called KIERSOL, uses potassium carbonate to extract carbon from flue gases with CO2 contents of between 10 and 25 per cent. The energy saving is realised through a 20 per cent reduction, in comparison to other technologies, in the energy used to recycle the solvent. A variant of the technology, KIERSOL-N, has also been developed for natural gas combustion, and will be tested by Hyundai Motor and Kia Motor before being applied industrially in 2015.
Company News
Enel and its Spanish subsidiary Endesa have both been named part of the Dow Jones Sustainability World Index, which rates companies on their social and environmental performance, and which is used as a guide by ethical investors. For Enel, which this year celebrates its 50th anniversary, it is the ninth year in a row that it has been included in the index, which began in 1999.
Foster Wheeler has announced the winning of a range of contracts over the last two months. Of interest to the combustion community are projects in South Korea, the UK, and Thailand. A 60 MW circulating fluidized-bed steam generator is to be designed and supplied to Yeosu Cogeneration, a subsidiary of Hanwha, a regular Foster Wheeler customer. The unit is to be installed in Yeosu City, South Korea, to commence operation in 2015. In the UK, Foster Wheeler will update the front-end engineering design of 2Co Energy’s 900 MW (installed capacity) Don Valley Power Project in Yorkshire, having been contracted by Samsung C&T. The project includes carbon capture and storage, and is expected to commence operation in 2016. Samsung (this time Samsung Engineering) also contracted Foster Wheeler for the project in Thailand, which involves the design, engineering and supply of a waste heat recovery unit with selective catalytic reduction, to be supplied in 2013 to the Map Ta Phut Industrial Complex.
Jindal Steel & Power has commenced operation of the first phase of its steel plant in Angul, in the eastern Indian state of Odisha (also known as Orissa). The project is one of the few greenfield projects of its kind in recent years, with the obtaining of land and legal approval major hurdles to surmount. The capacity of the phase just opened is 6 million tonnes per annum, with the ultimate capacity to be 12.5 million tonnes per annum, by which point a 1,600 MW coal gasification plant will supply the necessary power, along with six smaller plants producing a combined 810 MW of power. In what the company claims is a world first, syngas from the coal gasification plant will be used as a reductant in the steelmaking process. Lurgi Sasol Technology Company, of South Africa, are providing the coal gasification technology.
In further Jindal news, the company announced early this month that it bought Canada’s CIC Energy, which has coal holdings in Botswana. The $US 115 million/€93 million purchase will be followed by a $US 700 million/€567 million investment in the Botswana coal mines and an associated power plant project. The move is in line with Jindal’s strategy of owning resources to supply its power generation and steelmaking businesses. Sushil Maroo, a director of Jindal Steel & Power, was quoted as saying “You don’t get resources in India these days.”
The Export-Import Bank of China has become the sole lender to a $US 2.5 billion/€2.02 billion 400 MW coal gasification power plant project in Odessa, Texas, USA. State-owned Chinese firm, China Petrochemical Corp (known as Sinopec), will project manage a part of the construction, and provide some equipment, although overall construction management, and the supply of other equipment, will be through Siemens. Sinopec has existing interests in shale gas production in the US; the investment in the Odessa plant is seen as part of China’s strategy of investment in the US. The plant is expected to be in service by 2017.