Co-location as means to cleaner coal

In my last post, I mentioned co-location of manufacturing facitilies with coal power plants as a means of finding a less dirty way to leverage abundant coal resources. The existence of this approach at places like the Blue Flint ethanol plant was first pointed out to me by Bob Mcilvaine, president of Mcilvaine Company, a Northfield, Ill.-based consulting and technology research company that studies energy technologies.

The reason co-location of manufacturing with coal power generation makes sense, says Mcilvaine, is that you can combine newer, more efficient, coal-power equipment with a partner who can use the excess steam for manufacturing processes. In this way, says Mcilvaine, coal-power generation–which currently is only about 40 percent efficient at best, becomes close to 70 percent efficient because the excess steam is not being wasted, while the manufacturing plant doesn’t need its own coal-fired boiler.

Besides Blue Flint, says Mcilvaine, another plant in the works that will pump excess steam to manufacturing partners is the Spiritwood project, which also involves Great River Energy, the utility behind Blue Flint. The Spiritwood station will be able to reach an efficiency level of 66 percent using lower quality lignite coal, says Mcilvaine. Even with lower quality lignite, 66 percent efficiency still beats the roughly 50 percent efficiency of burning natural gas to generate electricity. “In other words, the most efficient standalone approach to power generation from fossil fuels doesn’t compare to co-generation in terms of efficiency,” says Mcilvaine.

Given the current cost of more advanced clean coal technologies such as integrated gasification and carbon sequestration, co-location may be one of the best means of more cleanly using current coal technology, says Mcilivaine. Such cogeneration sites will need the latest conventional gear and best available control technologies to reach maximum efficiency, he adds, but the biggest challenge may be to gain the interest of manufacturers who would need “reconfigure” the way they think about new manufacturing facilities. “Taking advantage of that two-third of potential energy that is wasted from coal is huge,” says Mcilvaine.

Another practical way to more cleanly leverage existing coal power technology, notes Mcilvaine, is to burn more biomass alongside coal. The biomass could include switchgrass or wood pellets, says Mcilvaine. In Europe, where carbon trading and more stringent carbon regulations already are a reality, the demand for wood pellets as a co-fuel has grown to such an extent that Europe has become a growth market for U.S. wood pellet manufacturers, as noted in this Wall Street Journal article.

What’s your view on coal power? Should we be investing more heavily in advanced technologies like coal gasification, and only use methods such as co-location of manufacturing with conventional coal power in a limited way?  Do you think a U.S. cap & trade system will force manufacturing sites with coal-fired boilers to upgrade to new technology, or possibly even close? Is cap & trade even worth the effort here, if in places like China, use of coal power (China relies heavily on coal, though according to a recent New York Times article, it is outpacing the U.S. in building efficient coal plants) continues to expand? Please post your thoughts, or contact me at rgmichel@gmail.com.