New coal plants wouldn't be clean, and would cost taxpayers billions | RenewEconomy

New coal plants wouldn’t be clean, and would cost taxpayers billions

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Even the cleanest coal plants add millions of tonnes of greenhouse gases to the atmosphere each year.

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The Conversation


Following a campaign by the coal industry, Prime Minister Malcolm Turnbull has argued for new coal-fired power stations in Australia. But these plants would be more expensive than renewables and carry a huge liability through the carbon emissions they produce.

Major Australian energy companies have ruled out building new coal plants. The Australian Energy Council sees them as “uninvestable”. Banks and investment funds would not touch them with a barge pole. Only government subsidies could do it.

It may seem absurd to spend large amounts of taxpayers’ money on last century’s technology that will be more costly than renewable power and would lock Australia into a high-carbon trajectory.

But the government is raising the possibility of government funding for new coal plants, with statements by Deputy Prime Minister Barnaby Joyce, Treasurer Scott Morrison and Environment and Energy Minister Josh Frydenberg. The suggestion is to use funding from the Clean Energy Finance Corporation. For this to happen, presumably the CEFC’s investment mandate would need to be changed, or the meaning of “low-emissions technologies” interpreted in a radical way.

It should come to nothing, if minimum standards of sensible policy prevailed.

But an ill wind is blowing in Australia’s energy and climate policy debate. The situation in parliament is difficult, and the Trump presidency is giving the right wing in the Coalition a boost.

Definitely not ‘clean’

Proponents of new coal plants call them “clean coal”. They have appropriated a term that normally means burning coal in power stations with carbon capture and storage, a technology that filters out most of the carbon dioxide. But this is expensive and has made little progress.

Turnbull and others are simply suggesting Australia build the latest generation of conventional coal-burning plants. They are not clean – merely marginally less polluting than the old plants running now.

A new high-efficiency coal plant run on black coal would produce about 80% of the emissions of an equivalent old plant. An ultra-supercritical coal plant running on black coal emits about 0.7 tonnes of CO₂ per megawatt hour of electricity, or about 0.85 tonnes using brown coal. That is anything but clean.

For comparison, typical old “dirty” black coal plants in operation now emit around 0.9 tonnes, so the improvement from replacing them with the latest technology is not large. Gas plants produce between 0.4-0.6 tonnes, much less than the suggested new coal plants. Gas has the added benefit of being able to respond flexibly to demand. A plant with carbon capture and storage might emit around 0.05 tonnes, and renewables zero.

The Australian grid average right now is around 0.8 tonnes and gradually falling. New coal would tend to keep that average higher over the long term.

A single typically sized new coal plant could blow out in the order of 5 million tonnes of CO₂ each year – about 1% of Australia’s current annual emissions – and would have an expected lifetime of 40-60 years. It would also pollute the air locally, as all coal plants do, causing damage to people’s health.

If we wanted to make up for the extra coal emissions by doing more in industry, transport or agriculture, then this would come at a cost in those parts of the economy. In-depth research has shown that decarbonisation of Australia’s economy needs to have zero-carbon electricity supply at its core.

What if we don’t care about the climate?

Building coal power plants is expensive. The average lifetime cost of producing power with ultra-super critical plants in Australia is estimated at around A$80 per megawatt-hour. This assumes financing is available at standard interest rates and that the plant runs at high capacity.

Given the risk that the plants will be liable under stricter carbon limits in the future, the financing costs are bound to be higher, probably north of A$100 – and may be as much as A$160. If the plant is not fully utilised, as is already the case for existing coal plants, average costs will be even higher.

By comparison, wind farms now get built at an average cost of A$75 per megawatt-hour, and solar parks at around A$110. Both are expected to come down to perhaps A$50 by 2025. New coal plants take many years to prepare and build, so 2025 is the relevant comparison.

In fact, the overall comparison costs for renewables are even lower. This is because wind and solar built in 2025 would be replaced in the 2050s with even cheaper systems.

There are extra costs associated with wind and solar – for instance, through pumped-hydro storage or more gas-fired power plants to balance supply. But these costs are far less than the underlying cost of renewables.

So renewables including system integration costs will be cheaper than new coal plants, perhaps by quite a margin. Let’s say, very conservatively, that renewables are A$20 per megawatt-hour cheaper. For the coal plant that’d be an extra cost of A$150 million per year, or A$6 billion over 40 years. The extra cost could be much higher if the plant was retired before the 2060s or not run at full capacity.

The subsidy required would be potentially billions of dollars for each plant. That’s billions of dollars from the taxpayer or electricity user, in order to supply power with high carbon emissions that are then locked in for half a century. It should not happen in a country that prides itself on rational economic policy.

Instead, government should set its sights on the long-term economic opportunities for Australia in a low-carbon world, and chart a path for the transition of the energy system.

Turnbull referred to Australia’s position as a coal exporter. But a revolution is under way in energy technologies. While coal will continue to be used in existing plants, the times of growing coal use are over. Already more than 70% of the world’s annual power sector investment goes to renewables.

Australia is lucky in that there are no limits to the amount of renewable energy that could be produced. New industries can be built around it. We should invest in the industries of the future, not sink more money into the technologies of last century.

Source: The Conversation. Reproduced with permission.

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  1. Radbug 4 years ago

    On my calculations, “burning” methanol, preferably, Solar Methanol, in a Direct Methanol Alkaline Fuel Cell stack, and the emissions vented directly to the air, would see a 70% reduction in carbon emissions, relative to a coal-fired plant operating at 42% efficiency. This is because a litre of methanol contains more hydrogen than a litre of liquid hydrogen and because fuel cells operate at 80% efficiency, relative to a USC at 47% efficiency. And this ignores co-generation. You could have the methanol delivered to your door (just like LPG) and the 20% heat generated from your DMFC stack could go to warm your property. There are excellent membrane technologies that will separate out the CO2 from the exhaust (thank you CCS!), and the energy cost of liquefying CO2 is 2.142% of the calorific value of the methanol that created it, far less than LNG.

  2. Sid Abma 4 years ago

    CCS has proven that it is very expensive, but Carbon Capture Utilization cost but a fraction to apply.

    It will remove over 90% of theCO2 out of the combusted coal exhaust and transform the CO2 into a useable – saleable product. Full time jobs will be created operating the CCS System as well as to a number of other industries.
    The amine that is used to absorb the CO2 is produced from a plant that is grown in agricultural fields, and while it is growing it is absorbing CO2 from the atmosphere
    and putting it into the earth.
    There is so much more that can be recovered from the combusted exhaust, The heat energy can be recovered and used to heat and or cool commercial greenhouses in which food crops can be grown. More jobs, more saleable product.
    With the heat energy removed, water is created. If just 20% of the distilled water is
    recovered the coal power plant could be self sustaining.
    The recovered coal ash can also be converted into saleable products. More full time jobs created.

    Waste is not a waste if it has a purpose and we have created a purpose for combusted coal exhaust.

    • Ren Stimpy 4 years ago

      Sid, the problem is that the coal industry has wasted its time and its ‘climate change budget’ money by pumping all of it into political influence and campaigns, rather than into R&D on those possible solutions you listed there. They could have had ‘some’ viable competition to renewables and energy storage going by now, but instead they chose to waste their money on ‘spiel’.

  3. James Prest 4 years ago

    The CEFC Act 2012 s.62 states that “An investment for the purposes of the Corporation’s investment function is an investment in a prohibited technology if it is an investment in: (a) technology for carbon capture and storage (within the meaning of the National Greenhouse and Energy Reporting Act 2007)”.

  4. James Prest 4 years ago

    Further to Frank’s useful discussion, see Section 60(1) of the CEFC defines Clean energy technologies as “any one or more of the following are clean energy technologies:
    (a) energy efficiency technologies;
    (b) low‑emission technologies;
    (c) renewable energy technologies.”
    It continues:
    60(4) A technology is a low‑emission technology if the Board is satisfied, in accordance with guidelines made under subsection (5), that the technology is a low‑emission technology.
    (5) The Board must, by writing, make guidelines setting out the matters to which the Board will have regard in satisfying itself that a technology is a low‑emission technology.
    (6) The guidelines must not be inconsistent with the Investment Mandate.
    The Investment Mandate is set out in s.64 and consists of Directions (in the form of a legislative instrument) given to the CEFC Board. Section 64(2) states that in giving a direction, the responsible Ministers must have regard to the object of this Act and any other matters the responsible Ministers consider relevant. However this is constrained by s.65 “Limits on Investment mandate” which states the responsible Ministers must not give a direction under subsection 64(1)…” that is inconsistent with this Act (including the object of this Act).” The object of the Act is in s.3 is to establish the CEFC ” to facilitate increased flows of finance into the clean energy sector.” However the term ‘clean energy sector’ is not defined in s.4 (Definitions), although the Act in s.60 (see discussion above) clarifies ‘clean energy technologies’.

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