Supplementary Memorandum by The Confederation
of United Kingdom Coal Producers
Following the public session on 13 November,
I believe it would be useful to make some further comments on
the evidence given by witnesses. The coal industry presented its
honest assessment, yet some important points could perhaps be
explained more fully here:
The future long-run cost of gas is
not an unknown. The International Energy Agency (IEA) has published
a cost curve showing estimates based on the costs of production
and transportation to European borders; costs to the UK, and of
course prices, would be higher. Clean coal technologies will be
competitive with gas from Russia (attachment 1).
The Committee rightly focused on
generation costs and existing coal-fired plant, at 1.6p/k Wh,
are undoubtedly the cheapest source. New, clean coal plants, at
around 3p/kWh, would meet long-term environmental objectives for
SO2, NOx, dust and other criteria pollutants; they can also achieve
the deep cuts in CO2 demanded by the Royal Commission on Environmental
Pollution. These are the conclusions of Jacobs Engineering Ltd,
advisors to the current DTI cleaner coal technology review.
Deep cuts can be achieved with carbon
capture and sequestration. In this case, the cost per tonne of
carbon saved is key. The IEA's Greenhouse Gas Programme, with
support from the DTI, has carried out much analysis work to conclude
that the cost would lie in the range £100-150/tC, and much
less when linked with enhanced oil recovery (attachment 2). Compare
this with the £312/tC cost of the proposed Renewables Obligation.
The Programme's Director is Dr Paul Freund.
The cheapest CO2 storage option for
the UK is enhanced oil recovery (EOR) in the North Sea. In 1996,
723,568 barrels/day were recovered from 212 EOR projects around
the world (84 using CO2 from a coal gasification plant in North
Dakota is now being sold via a 320 km pipeline to recover oil
from the Weyburn field in Saskatchewan, Canada, and will eventually
store 20 million tonnes of CO2. BP has set up a project team whose
aim is to recover an additional 336 million barrels of oil from
the Forties field by extending its life using CO2 injection (it
currently produces 60,000 barrels/day). Dr Tony Espie has presented
BP's work at many national and international conferences.
The Norwegian company Statoil is
injecting 1 million tonnes of CO2 each year into a deep saline
aquifer beneath the North Sea from its Sleipner gas field. The
natural gas is contaminated with CO2 which would otherwise have
been vented to atmosphere. The IEA is monitoring to ensure the
CO2 remains in place.
I was surprised that David Odling
of the UKOOA dismissed enhanced oil recovery as being in its very
early days, and confused this proven technology with the Sleipner
All the clean coal technologies needed
for deployment are available todaythere is no development
requirement. Carbon capture uses processes that are used widely
by the chemical industry, and the oil industry has commercialised
carbon dioxide sequestration. UK engineering contractors are well
placed to construct clean coal power stations using these technology
We are convinced that the UK can
become a leading light in deploying clean coal technologies to
tackle climate change; a challenge that was not widely foreseen
by those in the UK and USA who were developing clean coal technologies
in response to past energy crises. The UK coal industry sponsors
the IEA Clean Coal Centre, which, like the World Coal Institute,
is based in London; the IEA Greenhouse Gas Programme has its offices
at a former British Coal site near Cheltenham; and, the UK is
home to many leading engineering consultancies.
There is one clean coal technology
that meets both the short-term and long-term environmental and
security objectives at an affordable cost: integrated gasification
combined cycle (IGCC). This is a view echoed in a recent United
Nations report on sustainability written to inform Rio+10 by some
of the world's leading energy experts, including, from the UK,
John Baker (ex CEO National Power) and Dennis Anderson (Professor
of Energy Policy and Technology at Imperial College). Whilst quite
lengthy it contains a view on coal gasification in Chapter 8 closely
aligned with our own, a view reflected by the combined judgement
and scrutiny of the Editorial Board in their overview of the report
Like the generators, the coal industry
would be happy to maintain today's status quo. However,
we believe that environmental challenges must be faced. As energy
professional, we will continue to promote viable solutions to
these at every opportunity and are supported in this by very many
credible authorities. A Clean Coal Obligation would put us on
a clear path towards the long-term goal of near-zero emissions
at an affordable cost to consumers (attachment 4).
16 November 2001
1. The Government's Clean Coal Review;
a summary of UK COAL PLC's submission; Doncaster; September 2001.
2. Carbon Dioxide Capture and Storage,
International Energy Agency/Department of Trade and Industry;
Paris; September 2000.
3. Extracts from World Energy AssessmentEnergy
and the Challenge of Sustainability; United Nations Development
Programme (accessible at http://www.undp.org/seed/eap/activities/wea/);
New York; September 2000.
4. Affordable energy security from coal;
a topical briefing from the Confederation of UK Coal Producers;
Wakefield; November 2001.