CGI of China's GreenGen facility.
CATF believes that partnerships between companies in China and the West are crucial to accelerating the commercialization of low-carbon, coal-based energy generation. To that end, we are working in China and elsewhere in Asia to facilitate the development of joint business ventures between innovative energy companies and research institutions. The countries' shared reliance on coal creates many challenges—along with some critically important opportunities. Energy companies in North America, Asia, Europe, and Australia have enormous experience and expertise working with coal, and are similarly motivated to develop technologies and techniques that will preserve a role for coal in a carbon-constrained world economy.
The environmental and economic benefits of transitioning to clean energy will be smaller and slower to materialize if western and Asian companies do not work together. Investments by one country reduce the cost of that technology worldwide, increasing the likelihood that low-carbon technologies such as carbon capture, utilization, and storage (CCUS) will be widely deployed in time to help avert the worst consequences of climate change.
In China, CATF is represented by Ming Sung, our Beijing-based Chief Representative for Asia-Pacific. Our efforts in China build on the country's current leadership in low-carbon coal technologies essential to addressing climate change and energy security. Some highlights include:
- Stage 1 of the first commercial-scale IGCC power plant with CCS, called GreenGen, is now fully operational in Tianjin and features technology developed by the Clean Energy Research Institute (CERI) of China Huaneng Group, the largest power company in China.
- Use of CERI technology to retrofit a Shanghai power plant with one of the world's largest post-combustion capture systems.
- An underground coal gasification (UCG) pilot and commercial project (coal to methanol) built by ENN Group in Inner Mongolia is helping demonstrate UCG's ability to significantly lower the cost of coal-to-power with CCUS.
- Shenhua Coal is operating a large-scale geologic carbon sequestration project (currently at pilot scale) at a new large coal-to-liquids plant in the Ordos Basin in Inner Mongolia Autonomous Region.
- The East China University of Science & Technology has successfully licensed its 2,500t-petroleum coke gasification technology to western project developers, including the U.S.-based refiner Valero Energy Corp (as has CERI).
Mostly recently, CATF's focus in China has expanded to the sustainable development of shale gas resources. China has the potential to develop large amount of shale gas over the coming years. The government is committed to rapid development of its shale gas resources, setting a goal to produce 6.5 billion cubic meters (BCM) of shale gas by 2015, and 80 BCM by 2020. CATF is currently engaged with Chinese companies and the government to influence the push for shale gas development. This effort will focus on the expansion of shale gas development with as many climate and environmental protection measures as possible. Our goal is to avoid a decade of lost time and significant methane, carbon dioxide, and other air emissions from shale gas development in China by accelerating the adoption of best practices that have been developed over the last 20 years in the US. With natural gas prices at $12-18 MBtu in Asian markets (compared to $2.50 in US), there will be a large economic incentive to get as much of the gas to market as possible thus minimizing methane emissions.
CATF staff tour a gasification manufacturing facility in Shanghai, China.
CATF sponsors and facilitates meetings, conferences, and briefings in the U.S. and China to familiarize key companies and institutions in the West with these kinds of projects and, more broadly, with the technological and industrial prowess found in the Chinese energy sector. CATF's efforts provide western technology developers—especially those looking for opportunities to commercialize advanced gasification systems—with a platform for engaging potential Asian partners. Perhaps even more significantly, CATF has facilitated a growing number of partnerships that feature state-of-the-art and highly innovative low-carbon fossil technologies developed by Chinese companies and institutions; these technologies are being licensed to project developers in the West. This has taken the broader U.S.-China clean energy cooperation onto the next level and has profoundly positive implications for climate change mitigation efforts worldwide.
To coordinate these efforts CATF founded the Asia Clean Energy Innovation Initiative (ACEII) in 2009. Building strategic cross-border partnerships such as these that can reduce low-carbon coal technology costs and accelerate CCUS deployment is the mission of CATF's China Project.
Combining the extensive work, CATF has done envisioning and then developing a pathway to widespread CCUS deployment in the U.S. With substantial engagement with Chinese energy leaders, our work has helped lead to a number of promising recent ventures between North American and Chinese energy companies, including:
- With CATF's facilitation, the Texas Clean Energy Project (TCEP), a pioneering, 400MW-IGCC facility with 90% carbon capture located in Odessa, TX received a major boost in September 2012, as the project developer Summit Power Group signed a MOU with Sinopec Engineering from China, which allows the Chinese company to carry of Engineering, Procurement, and Construction (EPC) work at TCEP; this agreement also brings in over $1 billion in debt from the Export-Import Bank of China. The CO2 captured at TCEP will be sold for EOR, while the plant will also produce electricity, sulfuric acid, and urea fertilizer for additional revenue.
- In February 2012, Massachusetts-based GreatPoint Energy and Shanghai-based China Wanxiang Group signed a partnership worth $1.25 billion which will enable GreatPoint, a technology developer, to build the first-of-its-kind large-scale coal-to-gas facility with a process called hydromethanation by 2015. The new facility has an expected production capacity of 30 billion cubic feet (BCF) and will capture carbon which will be sold for other industrial purposes. Wanxiang will fund a portion of the project in addition to being a co-developer and co-operator. The project is located in the coal-rich Xinjiang Uighur Autonomous Region.
- EmberClear Corporation is the exclusive North American licensee of Huaneng CERI's multi-stage, dry-feed, waterwall coal gasification system, which has also been installed at the GreenGen IGCC project in Tianjin. EmberClear planned to install the technology at its Good Spring IGCC project in Pennsylvania, which was expected to deliver 270 megawatts of electricity while capturing over 50 percent of the CO2 output initially and nearly 100 percent by 2020. The companies have also signed an agreement to share technical data from the Good Spring plant and the GreenGen facility. In February 2012, the two companies signed a new technology licensing agreement which allowed EmberClear to produce low-emissions liquid fuel from coal in the United States with CERI's CTL process.
- Duke Energy and China Huaneng Group signed a technology-sharing Memorandum of Understanding (MOU) in August 2009, the potential focus areas of which include “(1) clean coal power generation with the focus on IGCC and ultra-supercritical power generation; (2) CO2 capture and sequestration including pre-combustion capture, post.combustion capture, enhanced oil recovery (EOR) and geologic sequestration, etc.; (3) Efficiency-improvement and emission reduction in coal-fired power plants; (4) renewable energy power generation including wind, biomass, solar and other energy sources.” According to a Duke official, “we both have the scale and mass to push the global industry forward in the development of clean technologies.” In February 2012 the two corporations expanded their cooperation by signing a new, three-year agreement which enabled them to conduct joint engineering study to determine the potential feasibility of deploying Huaneng's carbon capture process at Duke's Gibson Station located in Indiana.
- In January 2011, American Electric Power (AEP), one of the largest utility companies in the U.S., signed an agreement with China Huaneng Group to collaborate on a range of low-carbon energy and energy efficiency technologies, including knowledge-sharing on post-combustion carbon capture (PCC) technologies. Huaneng operates a large-sized PCC system at a commercial-scale coal power plant in Shanghai, while AEP is working to develop a similar facility in the United States. The agreement between the companies was signed during Chinese President Hu Jintao's state visit to the United States and was lauded in materials released by the White House . evidence of the growing importance of low-carbon energy in the commercial relationship between the two largest economies in the world.
- In January 2011, AEP signed a cooperation agreement with State Grid Corporation of China, the country's largest electricity distributor and one of the world's largest companies in terms of revenue, through which the two companies would jointly evaluate and potentially advance six transmission and distribution technologies, including ultra-high-voltage transmission equipment, advanced energy storage technologies, smart-meter technologies, and distributed generation technologies. Experts from each company would work together to research different technologies and share data about their performance. If the technologies prove feasible, the companies will explore potential fabrication and manufacturing in the United States. This agreement was also announced during President Hu's state visit to the White House.
- An initial September 2009 agreement between the U.S.-based utility Duke Energy and ENN Group of China promotes joint technology development of a variety of technologies, from CCS-relevant systems including UCG to solar energy, biofuels, and energy efficiency. In a follow-on agreement signed in May 2011, ENN Group agreed to make capital investments in commercial solar projects operated by Duke Energy Generation Services.
- Atlanta-based Southern Company deployed the KBR-developed Transport Integrated Gasification Technology (TRIG) at a commercial-scale coal gasification plant operated by Dongguan Tianming Electric Power in China. The terms of this agreement include technology licensing, engineering, and equipment to use TRIG technology at a new 120MW power plant. Operation began in 2011.
- Zero Emission Energy Plants, Ltd. (ZEEP) and ENN Group reached an agreement in September 2009 to design and construct a commercial-scale power plant in Shandong Province featuring Connecticut-based Pratt & Whitney's Rocketdyne gasification system.
- Canada's HTC Purenergy, a leading technology developer, is collaborating with Suntracing from China to demonstrate modular technology developed by HTC that uses CO2 captured from power applications to produce a fire-suppressing foam; the foam is then used to put out coal seam fires, which are common in China and a significant contributor to global CO2 emissions.
Through facilitating these high-profile, high-impact low-carbon energy partnerships, CATF has also identified new paths to further catalyze the wide-scale deployment of technologies that we deem beneficial both to the climate mitigation goals and a more vibrant global energy economy. US companies have decades of experience pipelining CO2 and injecting it deep underground for enhanced oil recovery (EOR), which offers a stable revenue stream, and the country's capacity for entrepreneurship and innovation has produced a range of companies developing advanced carbon capture and sequestration (CCS) technologies. Companies in China are unparalleled in their ability to scale-up technologies quickly and inexpensively. China has more experience with coal gasification (a key CCS technology) than any other country, and it is rapidly commercializing gasification for electricity generation. Having recognized these complementary strengths, CATF is currently in an effort to facilitate the transfer of knowledge in CCS-EOR from the Gulf States to the depleting oil fields in China.