The suitability of coal gasification in India's energy sector

Abstract

Integrated Gasification Combined Cycle (IGCC), an advanced coal-based power generation technology, may be an important technology to help India meet its future power needs. It has the potential to provide higher generating efficiency, can be adapted to efficiently burn India's high-ash coal, and has the potential to do so with greatly reduced emissions and offers the longer term potential to assist India to manage its C02 emissions. Efficient gasification technology also offers India the potential to produce a variety of fuels, particularly transportation fuels, and chemicals. These potential benefits would be useful in a country that has coal shortages, runs inefficient power plants, and imports the majority of its transportation fuels. Driven by these potential benefits the Central Government-owned power generating equipment manufacturing company (BHEL) is developing a fluid-bed gasifier designed for Indian coals, but has not yet demonstrated it at a size larger than 6 MW. Outside of BHEL, there are many factors holding this technology back. First, the technology is projected to be more expensive than pulverized coal (PC) power generation. In the Indian environment, the capital costs are estimated to be 1.5 times higher, and the levelized cost of electricity is estimated to be 33 % higher than for PC power generation.

(cont.) Further, there are other technology options, such as super-critical pulverized coal technology, which are cheaper, more proven, and can provide immediate higher generating efficiency. The first supercritical PC plant is currently being built in India. To overcome these barriers will take further research and development, as well as demonstration at a commercial scale. This all needs to occur at a greater speed and with a greater urgency than is now apparent. The demonstration and commercialization will require significant subsidies, which may come in different forms. The Central Government may wish to subsidize the technology development for the pollution control benefits that it offers and do so via its linkages to BHEL. Foreign governments and institutions may choose to subsidize the costs for the carbon dioxide reduction credits that it can produce. In the end, the challenges facing IGCC in India are great. The cost and generating efficiency will have to at least rival those for other advanced coal technologies, and coal production and mining policies will have to be effectively enacted to increase the supply of coal available for new coal plants.