Select Committee on Science and Technology Written Evidence


Memorandum submitted by the World Coal Institute


  1.  The need of the UK, for safe, affordable, environmentally friendly and reliable energy will require a mix of fuels and a revolution in the development and deployment of new technologies across nuclear, renewables and fossil fuels.

  2.  The current UK over reliance on gas and oil, and its new status as a net importer of energy, should serve as a warning against future over reliance on any one fuel source or the geographic/political region that produces it. Nuclear and renewables can certainly be part a responsible energy mix, but they are not alone the solution.

  3.  Recent independent reports—notably those from the World Energy Council, the International Energy Agency and the Intergovernmental Panel on Climate Change—have confirmed that fossil fuels, and particularly coal, will be needed well into this century. The UK will continue to need coal for basic electricity (heating and lighting) and industry growth. These same reports confirm that coal can be used in an environmentally responsible manner; they indicate that carbon capture and storage can enable continued economic growth and significant mitigation of harmful CO2 emissions.

  4.  While much needs to be done to ensure adequate investment in many mitigation options, investment in the development and rapid deployment of clean fossil fuel technologies is manifestly in the world's best interests. These technologies offer a win-win solution with the potential to maintain the value of strategic hydrocarbon assets, fuel social and economic development in developed and developing countries alike, and ensure near zero emissions to the environment from fossil fuel use.


  5.  The World Coal Institute (WCI) is a non-profit, non-governmental association and the only international body working on a worldwide basis on behalf of the coal industry. Membership of the WCI is open to coal enterprises and stakeholders from anywhere in the world, with members represented at Chief Executive level. More details on the WCI and its membership and can be found at Members include: PT Adaro (Indonesia), Anglo Coal, Australian Coal Association, BHP Billiton, BHP Mitsubishi Alliance, Coal Association of Canada, Coal Mining Association of New Zealand, Confederation of UK Coal Producers (COALPRO), Carbones del Cerejon (Columbia), PDVSA Carbozulia (Venezuela), Consol Energy, Indonesian Coal Mining Association, Glencore International, Joy Mining Machinery, Mitsubishi Development, National Mining Association (US), RAG Coal International, Rio Tinto, Solid Energy (NZ), Swedish Coal Institute, Total, and Xstrata.

  6.  WCI's key objective is to provide a voice for coal in international energy and environment policy and research discussions. Members of the WCI are undeniably and transparently pro-coal, but have explicitly committed to:

    —  co-operate in supporting sustainable development, including economic growth, social development and improved environmental outcomes;

    —  promote cleaner coal technologies and the responsible use of coal;

    —  encourage improving mine health and safety; and

    —  practice corporate social responsibility.


The UK "generation gap" and the need for clean coal

  7.  The UK has a large demand for energy (equivalent to almost 235 million tonnes of oil) of which coal supplies 17%[22]. Contrary to popular opinion, in the case of electricity, coal accounts for 37% of total generation and more than half of this comes from domestic coal. This brings a high degree of security and price stability to an energy market increasingly reliant on imported natural gas.

  8.  In 2004, the UK ceased to be an exporter and became a net importer of energy, clearly undermining its energy security profile. The extent of the generation gap facing the UK can be indicated by the fact that over the next 25 years, EU demand for electricity is expected to rise by almost 60%[23]. Bridging this gap will likely require investment in new nuclear and renewables. However, given the infrastructure lead times and technical uncertainties involved in those sources, the UK would be unwise to ignore both its substantial domestic reserves of coal (220 million tonnes[24]) and the international trade in affordable coal from many politically stable and friendly nations[25]. The UK has the opportunity and expertise to use its existing coal reserves in an environmentally sound manner, through the clean coal technologies[26] being developed and deployed under the just-announced UK Carbon Abatement Technologies Strategy and by programmes in other nations. This vital strategic reserve could underpin UK energy security for many years to come. This would help limit import dependency on foreign sources of uranium and other fuels, and delay the growing British dependency on Russian gas in particular.

  9.  Commonsense and national interest dictates that investment decisions on new energy sources (eg nuclear and renewables) should not ignore the long-term strategic demands of British energy security. For electricity generation, this means the development of the most efficient, cost-effective and environmentally responsible mix of energy sources; this means:

    —  safe and cheap nuclear;

    —  cheap and reliable renewables; and

    —  clean coal.

  10.  All will require substantial investment and government leadership. None alone will bridge the generation gap facing the UK and none alone will produce the energy security that the UK needs. However, a sensible investment programme in all three will meet the UK's strategic energy and environmental objectives.

Clean coal technologies offer solutions

  11.  Clean coal technologies are available that can deliver substantial, large-scale reductions in CO2 emissions in electricity generation. These include carbon capture and storage technologies that allow fossil fuels to be used with minimal emissions—the CO2 being put back underground from where it came. The UK Department of Trade and Industry is to be commended for the release (June 2005) of its Carbon Abatement Technologies Strategy. The £25 million funding announced is an important investment in realizing the potential of CCS and can complement work being undertaken in a range of countries in this area from which the UK can benefit.

  12.  Researchers at Princeton University have made an assessment of CO2 emissions might be stabilised over the next 50 years to skirt the worst consequences of global warming. Emissions would need to be trimmed by seven billion tonnes of carbon per year. From their assessment, they have identified 15 strategies, each of which could deliver carbon savings of at least one billion tonnes (1 Gt) by scaling up technologies available today. Three relate directly to CCS:

    —  Capture and store emissions from 800 coal power stations worldwide.

    —  Produce hydrogen from coal at six times today's rate and store the captured CO2.

    —  Capture carbon from 180 coal-to-synfuels plants and store the CO2.

  13.  These three strategies alone could account for almost half the carbon savings needed by the world. By way of contrast, other means of delivering 1 Gt of CO2 emissions savings could include building 700 nuclear power plants (1000 Mw each) or building 300,000 wind turbines (5Mw each) covering a land area equivalent to Portugal.

  14.  The implication for UK energy, environment and investment policy is that investment decisions should not divert necessary funds from this most important area of practical response to climate change.

Carbon Capture and storage (CCS)

  15.  The International Energy Agency has identified CCS as an important transitional technology that "can co-exist [with renewables and nuclear] as part of a cost-effective portfolio of options for reducing CO2 emissions from energy production."[27]

  16.  The most recent authoritative and independent work on CCS was produced last month by the Intergovernmental Panel on Climate Change. The WCI commends that report to the Committee and draws its attention to several key findings addressing previous concerns with regard to CCS and support the early development and deployment of the technologies involved.

Potential storage capacity

  17.  The potential storage capacity of underground formations is substantial. According to the Intergovernmental Panel on Climate Change (IPCC):

    Available evidence suggest that worldwide, it is likely that there is a technical potential of at least about 2,000 Gt CO2 of storage capacity in geological formations.

    In most scenarios for stabilization of atmospheric greenhouse gas concentrations between 450 and 750 ppmv CO2 and in a least-cost portfolio of mitigation options, the economic potential of CCS would amount to 220-2,200 Gt CO2 cumulatively, which would mean that CCS contributes 15-55% to the cumulative mitigation effort worldwide until 2100, averaged over a range of baseline scenarios. It is likely that the technical potential for geological storage is sufficient to cover the high end of the economic potential range, but for specific regions, this may not be true.[28]

  18.  A "technical potential" capacity of 2,000 Gt CO2 is more than enough to sequester the world's CO2.

  19.  The UK is well placed to exploit CCS because it has large sources of CO2 located within reasonable distances of geological formations suited for long term storage, with the economic advantage of enhanced oil recovery (EOR). The North Sea alone may provide enough geological capacity for all the CO2 produced from European power stations into the second half of this decade while increasing the economic life of the North Sea oil resource.

Leakage potential

  20.  Most concern about CCS has focused on the potential for leakage of CO2 from storage sites. Leakage would depend upon a variety of factors but most critically upon the choice of storage: ocean storage, mineral carbonation, or geological. In relation to deep ocean storage; the IPCC has found "leakage would be gradual over hundreds of years"; and in relation to mineral carbonation "the CO2 stored would not be released to the atmosphere". Most importantly, in relation to geological storage (eg the North Sea), it found:

    Observations from engineered and natural analogues as well as models suggest that the fraction retained in appropriately selected and managed geological reservoirs is very likely to exceed 99% over 100 years, and is likely to exceed 99% over 1,000 years.

    For well-selected, designed and managed geological storage sites, the vast majority of CO2 will gradually be immobilised by various trapping mechanisms and, in that case, could be retained for up to millions of years.[29]

Costs and benefits

  21.  The cost of a full CCS system for electricity generation from a newly built, large-scale fossil fuel based power plant depends upon a number of factors, including the characteristics of the power plant and the capture system, the specifics of the storage site, the amount of CO2, and the required transport distance. Accepting these uncertainties, the IPCC has found:

    Application of CCS to electricity production, under 2002 conditions, is estimated to increase electricity generation costs by about 0.01-0.05 US dollars per kilowatt hour, depending on the fuel, the specific technology, the location, and the national circumstances. Including the benefits of EOR would reduce additional electricity production costs due to CCS by around 0.01 to 0.02 US$/kWh.[30]

  22.  Retrofitting existing power plants with CCS could be expected to lead to higher costs and reduced efficiencies.

  23.  The net reduction of emissions to the atmosphere through CCS depends on the fraction of CO2 captured, the increased CO2 production resulting from loss in overall efficiency of power plants or industrial processes due to the additional energy required for CCs, any leakage from transport, and the fraction of CO2 retained in storage over the long term. The IPCC has found:

    Available technology captures about 85-90% of the CO2 processed in a capture plant. A power plant equipped with a CCS system (with access to geological or ocean storage) would need roughly 10-40% more energy than a plant of equivalent output without CCS, most of it for capture and compression. For secure storage, the net result is that a power plant with CCS could reduce CO2 emissions to the atmosphere by approximately 80-90% compared to a plant without CCS.[31]

    (Bolded emphasis added by WCI.)

State of play with regard to technological development

  24.  The basic technologies needed for CCS have already been developed, however there are development needs to produce cost effective integrated systems. The development of the technology necessary for geological storage (such as that which would be used in the North Sea) is more developed than for oceanic storage. The IPCC has a produced a useful table which summarises the state of play for the various components which would need to be brought together for CCS to be realised.

Current state of technological development of CCS system components[32]

  25.  This tables indicates that most of the necessary components for geological storage (eg North Sea storage) are classified as either "Mature market" or "Economically feasible under specific conditions".

Competition vs co-operation

  26.  It is a myth to assume that either the UK's or the world's 21st century energy needs will be met by any one energy source. It is a myth to assume that any energy source is without cost or challenge and will not require heavy investment and government leadership to overcome present imperfections. The WCI rejects the sterile and outdated paradigm which sets different energy sources against one another, and so should government.

  27.  Getting to a new energy economy, without massively disrupting industry and society along the way, will require a level of co-existence and even co-operation between the various energy sources that only a decade ago might have seemed imaginable. The role of government should be to manage that transition to ensure that:

    —  industry and society are not disrupted by abrupt energy shifts;

    —  the heavy lifting base load capacity of coal and other fossil fuels supports economic and social development and allows renewables and newer energy forms the time to overcome their present imperfections; and

    —  the use of current energy forms, such as coal, are supported by the latest technologies in energy usage such as carbon capture and storage so that they can be used in an environmentally benign manner.


  28.  The World Coal Institute recommends the Committee:

    —  Encourage investment in the existing fleet of coal-fired power stations to further reduce sulphur dioxide and carbon dioxide emissions:

      —  By actively encouraging the use of flue gas desulphurisation;

      —  By supporting a supercritical boiler retrofit project;

      —  By reviewing the rules that limit biomass co-firing.

    —  Promote the construction of a fleet of new integrated gasification combined cycle (IGCC[33]) power stations where coal can be used cleanly and efficiently and, ultimately with near-zero emissions.

    —  Support funding for research, development and commercial demonstration of clean coal technologies, including those that are needed to capture and store CO2:

      —  The benefits for such investment can go beyond electricity generation (eg hydrogen produced from coal at IGCC power stations can play an integral part in reducing emissions from the transport sector).

October 2005

22   Statistical data on UK energy supply and demand comes from the Digest of United Kingdom Energy Statistics 2005, Department of Trade and Industry, London, and from monthly DTI website updates. Back

23   European Energy and Transport Trends to 2030, Directorate-General for Energy and transport, European Commission, 2003. Back

24   UK proved reserves at end 2004 as reported in BP Statistical Review of World Energy, June 2005. Back

25   In contrast to oil and gas and uranium, coal is produced in about 50 countries around the world and remains the most affordable and reliable of base load fuels, supported by an existing international trading architecture and technical expertise. Back

26   Including carbon capture and storage. Back

27   p 19, Prospects for CO2 Capture and Storage, International Energy Agency, 2004. Back

28   p 18, Special report on Carbon Dioxide Capture and Storage: Summary for Policymakers, Intergovernmental Panel on Climate Change, 25 September 2005. This was approved by the 8th Session of IPCC Working Group III on 25 September 2005 and is the latest available at the time of drafting of this memorandum. However, it is "Subject to final copy editing, reference and footnote editing, and figure editing." Back

29   p 23, IPCC. Back

30   p 14, IPCC. Back

31   p 4, IPCC. Back

32   Table S.2, p 11, IPCC. Back

33   In IGCC systems, coal is not combusted directly, but reacted with oxygen and steam to produce a syngas composed mainly of hydrogen and carbon monoxide. The syngas is cleaned of impurities and then burned in a gas turbine to generate electricity and to produce steam for a convention steam power cycle. IGCC lends itself to carbon capture and storage technologies to ensure that carbon does not enter the atmosphere. Back

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