• Comustion Industry News

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      Patrick Lavery

      Combustion Industry News Editor

Japanese tests producing methane from subsea methane hydrate crystals

Japan’s Ministry of Economy, Trade and Industry announced earlier in the month that tests have successfully begun to produce methane gas from methane hydrate crystals. Japan is leading a number of countries, including India, Canada, the United States and China, in developing methods to exploit the resource, which is typically trapped underneath the sea floor. A trial in 2013 had to be halted after a week because of sand ingress into the well, but the tests this year appear to be progressing well so far. In the Nankai Trough off the country’s Pacific coast, where tests are currently taking place, there is an estimated 1.1 trillion cubic metres of the hydrates, enough to power Japan for 11 years. With a move away from nuclear power following the 2011 Fukushima Disaster, and being the world’s leading import of LNG, a domestic supply of gas is strongly in Japan’s strategic interest. More widely, commercialisation of the fuel has the potential to change energy markets globally. The current tests, being conducted at two different wells, are due to last 4-5 weeks.

Colorado legislators develop bill to ease social transition from coal to renewables

Legislators in Colorado have introduced a new bill to the State assembly which attempts to use financial instruments to help ease the social transition resulting from the technical transition from coal-firing to renewables. The bill applies to situations in which coal-fired plants close before their capital costs have been paid off. Usually in Colorado, ratepayers will continue to pay the costs of such plants even when they are no longer operating, while the community suffers job losses from their closure. What the bill aims to do is help to refinance the outstanding part of the loan at a lower interest rate, lowering the costs for all involved, and using 15% of the savings to create a kind of transition fund for people affected by job losses. The refinancing of the loans is done by the creation of bonds which are used to invest in new infrastructure in the area, for example renewable power generation. The bill has attracted widespread interest and may be replicated across the US and perhaps in some forms in other countries.

US residential electricity consumption appears to be dropping due to energy efficient lighting

A blog post by the Haas Business School at the University of California Berkeley has drawn attention to data which appears to show that residential electricity use per person in the United States peaked in 2009-10. From the 1950s to 2010, residential electricity use increased by a factor of 10 as houses got bigger and filled with more electrical devices. Since then, a slow decline in use has occurred which the author attributes to the rise of energy efficient lighting. The 450 million LEDs that have been installed in the US have virtually all been installed since 2009 (as LED prices over the period fell 94%), and compact fluorescent lightbulbs have enjoyed an even more rapid deployment. Looking forward, the author says it is uncertain if the peak will be a temporary or more lasting one, but it is certain to have an effect on power generators and future energy policy.

Lacklustre delivery of mega coal plants in India over last decade another reason why none will be built in coming five years

Following the recent media attention towards the future of coal firing in India, news website Quartz has investigated if the “era of mega thermal plants in India is over”. The push for such plants was begun in 2005 by then Prime Minister Manmohan Singh, with sixteen plants planned, each sized at around 4 GW. Four of these plants were awarded, and two of those were built – Reliance Power’s Sasan project in Madhya Pradesh and Tata Power’s in Mundra, Gujarat. The other planned plants experienced a range of problems which meant they did not go ahead, from a failure to acquire land or secure fuel to problems with government policy. Both plants that were constructed are facing difficulties, mainly to do with tariff caps which are preventing them from adjusting to fuel price fluctuations. With this background, mega thermal plants may not appeal to investors, but other market factors make the picture gloomier – growth in demand for electricity is not as strong as it used to be (reflected in the fact that plant utiliisation is declining), and renewables are becoming more cost-competitive. The current Modi government wishes to install around 130 GW of renewable power generation capacity by 2022 (making the total installed capacity of renewables 175 GW). What appears most likely is that coal-fired generation will grow slowly in India over the next five years as more renewable capacity is installed. But as coal provides most baseload power generation in India, it is likely to continue this role for at least as long as renewables are unable to do so.

Eskom threatens to cut off power exports to Zimbabwe

South African utility Eskom has threated to cut off electricity exports to Zimbabwe if arrears are not paid. From imports of 300 MW of power, Zimbabwean state power company Zesa owes Eskom 603 million rand (US$45.8 million/€41.6 million), with 119 million rand of it outstanding. Acting Eskom CEO Matshela Koko is reported to have asked Zesa to “Kindly note that no further leniency or accommodation will be made in this regard,” while the CEO of Zesa has said that the company is in talks with the Zimbabwean central bank about foreign currency allocations. With foreign currency in Zimbabwe scare, and with a power shortfall of around 7% of demand, there are big headaches for Zesa and Zimbabwe more widely.

University of Amsterdam researchers look to commercialise new catalyst for conversion of carbon dioxide

Last month saw news from the University of Amsterdam, where two chemistry researchers are beginning to commercialise a catalyst for converting CO2 to CO at relatively mild conditions. Edwin Gnanakumar and Shiju Raveendran came upon the catalyst by accident, but found it performed better than previously reported catalysts. They say it is easily prepared and inexpensive, and can work at ambient pressures and low temperatures, and their work indicates that it could be used in flue gases at an industrial scale. If the catalyst was found to be efficient and affordable, it would be of great interest to the combustion community.

Trump administration puts off Paris Agreement decision

The Trump administration is to put off a decision about whether to keep the US in the Paris Agreement. As ABC News reports, the administration was due to make a decision before the G7 meeting in Italy at the end of the month, but will now wait until after the summit. A range of businesses have been urging the government to stay in the agreement, including Apple, Google, Walmart, and Tiffany and Company. Interestingly, it has emerged that the as the US Senate never ratified the accord, the US is not currently bound by it legally, meaning that withdrawal would be easier than the previous estimates of a two to four year process.

Wood Group on track to take over Amec Foster Wheeler despite weaker than expected start to 2017

Wood Group’s plan to buy Amec Foster Wheeler for a reported £2.2 billion (US$2.8 billion/€2.6 billion) appears not to have been compromised by a weaker than expected start to the year for the prospective buyers. A shareholder vote in June at Wood Group – the UK’s largest oil services firm – is to decide whether the buyout should go ahead, with the company expecting that cost savings of £150 million (US$194 million/€176 million) per year can be made across the two companies when they are fully integrated. While Wood Group is the larger company, Amec Foster Wheeler has the more diverse work, and it is this that Wood Group is hoping to tap into with the merger. The weaker first quarter earnings for Wood Group reflected dampened activity in the North Sea, and led to a brief fall in the share price, which later recovered.

Engie to sell majority stake of oil and gas exploration business

Engie is to sell a majority stake in its oil and gas exploration business to private equity firm Neptune Oil & Gas, with the price believed to be a nett US$3.9 billion (€3.5 billion). The move will concentrate Engie’s business towards more steady operations, such as power distribution, and away from fossil fuels, at the same time reducing debt, while for Neptune it marks a huge step for a company only two years old. Sam Laidlaw, the head of Neptune, said “Our ambition is to create a leading international independent energy and power company within the next 5 years.” The assets range from Asia, through Algeria to the North Sea, with a total output of 150,000 barrels of oil per day. If the price of oil picks up, it may be a wise investment for Neptune.