ZERO EMISSION FOSSIL FUEL POWER

Technological state of the art and anticipated developments

The main fossil fuel based electricity generation technology in the EU is pulverized coal. A typical state-of-the-art supercritical pulverised coal plant has 45% efficiency, while few, more advanced coal power plants demonstrate efficiencies up to 48%. The estimated specific capital investment costs can be found in the key figures section of the web site and used in the Energy Cost Calculator. The second most important technology is gas turbines in combined cycle (GTCC) burning natural gas. State-of-the-art plants have energy efficiencies ranging between 57% and 60%. Current specific capital investment costs can also be found in the key figures section of the web site.

It is expected that in 2020, pulverised coal plants will have efficiencies around 50%, and natural gas combined cycle plants about 65%. Other technologies, such as integrated gasification in combined cycle (IGCC) and circulating fluidized bed combustion (CFBC) could be commercialised during the same period, with efficiencies reaching 45-55%.

Zero emission fossil fuel power plants (or ZEP plants) make the assumption that they will capture at least 85% of the CO2 formed during the power generation process. The CO2 that will be captured is planned to be transported to suitable underground locations where it will be stored permanently and safely. Currently, all elements of the technology of ZEP plants have been developed and utilised by other industrial sectors but on much smaller scales than those needed for electricity generation: capture technology (pre- and post- combustion and oxyfuel) is at an advanced stage of research; large scale transport of CO2 using pipelines has been commercialised in N. America; and a number of industrial CO2 storage facilities are operational around the world, storing about 3 Mt of CO2 annually. In addition, 79 CO2-EOR projects worldwide currently inject about 40 Mt of CO2 annually into oil reservoirs. Overall, the ZEP plant technology is ready to embark on its demonstration phase.

From the technology point of view, ZEP plants can be commercialised as of 2020, with first-of-a-kind plants coming into operation by 2015. The first generation of commercialised pulverised coal, combined cycle gas turbine and IGCC plants with CO2 capture are expected to have efficiencies of 33, 48 and 35% respectively.

Market and industry status and potential

Currently, fossil fuel power plants are the backbone of the European electricity generation system, providing for 56% of the total electricity demand, followed by nuclear energy (31%) and renewables (13%). In the EU, coal plants have a share of 29% in electricity generation and natural gas combined cycle plants 19%. All energy forecasts show that fossil fuels will remain the main fuel for electricity generation in the medium and long term, retaining a share in power generation of the order of at least 40-50% in 2030. The actual share of advanced coal and natural gas technologies in the future fossil fuel power plant fleet will depend on the prevailing fossil fuel prices and the evolution of the carbon market. ZEP plants could compete with conventional power plants for a share in power generation capacity as soon as they are commercialised, or their deployment could be regulated. The actual level of penetration will depend on the time of commercialisation and deployment, the regulatory framework, the environmental constraints and the extent of the CO₂ transport network. The baseline assumes that ZEP plants are not commercially deployed in the EU-27 before 2030. The estimated maximum potential for ZEP plants in the EU-27 is up to 190 GW by 2030. This represents about 32% of projected EU gross electricity consumption by that year.

Impacts

Carbon Dioxide Emissions

Currently, fossil fuel power plants are the backbone of the European electricity generation system, providing 56% of the total electricity demand, followed by nuclear energy (31%) and renewables (13%). In the EU, coal plants have a share of 29% in electricity generation and natural gas combined cycle plants 19%. All energy forecasts show that fossil fuels will remain the main fuel for electricity generation in the medium and long term, retaining a share in power generation of the order of at least 40-50% in 2030. The actual share of advanced coal and natural gas technologies in the future fossil fuel power plant fleet will depend on the prevailing fossil fuel prices and the evolution of the carbon market. ZEP plants could compete with conventional power plants for a share in power generation capacity as soon as they are commercialised or their deployment can be regulated. The actual level of penetration will depend on the time of commercialisation and deployment, the regulatory framework, the environmental constraints and the extent of the CO2 transport network. The baseline assumes that ZEP plants are not commercially deployed in the EU-27 before 2030. The estimated maximum potential for ZEP plants in the EU-27 is up to 190 GW by 2030. This represents about 32% of the projected EU gross electricity consumption by that year.

Security of Supply

It is likely that the deployment of ZEP plants will be associated with an increase in the consumption of coal for economic reasons and as a result of coal’s improved environmental footprint. However, the lower efficiency of ZEP plants (in comparison with non-ZEP ones) will lead to higher specific fuel consumption. Achieving the maximum potential for ZEP plants could lead to an increase in fossil fuel use by up to 85 Mtoe in 2030, with a maximum cumulative additional fossil fuel consumption of 590 Mtoe for the period 2010 to 2030. However, given that coal resources are more widely spread around the world than other conventional fuels, coal supplies do not rely on rigid delivery paths, and coal is traded in a global and liquid market, the increased consumption may not negatively affect the security of supply. On the other hand and to the extent that an increased demand for coal could lead to some increase in the world coal price, the EU could benefit from domestic resources which at present price levels face unfavourable economics.

Barriers

The high cost of first-of-a-kind plants, needed for demonstrating key technological components and building confidence on CO2 emission reduction potentials, has been cited as one of the main barriers to progressing further with the technology. Other key issues that need to be addressed include: the lack of an enabling framework that tackles among others the permitting of storage sites; the uncertainties in carbon prices and the emissions trading scheme; the lack of business plans for evaluating carbon value chains; and public acceptance. The further development and up-scaling of capture technologies necessitates a significant additional R&D effort. Focal points of additional work in capture and storage are: the improvement of power plant efficiency, which will also benefit conventional power plants; the reduction of capital costs so that the capture cost can fall below €20-30 per tonne of CO2 avoided; the development of innovative and more cost-effective capture processes; the development of new materials, including membranes; the better integration of plant components with a concurrent increase in plant availability; the assessment of the European CO2 storage capacity; the safety of storage; monitoring of storage sites for leakage; and the long term assurance of the permanence of storage.

Needs

The development of a regulatory market framework and of appropriate policies that will give positive signals to the power sector to invest in ZEP plant technology is a requirement for the further development and deployment of the technology. Of equal importance is the research for the up-scaling and further development of the technology. Finally, the financing and regulation of the infrastructure for CO2 transport and storage will need to be addressed on both the European level and the Member State level.

Synergies with other sectors

Hydrogen has been identified as one of the possible additional products that could give an added value to ZEP plants operating in a poly-generation scheme based on gasification technology, producing also other synthetic fuels, including natural gas. The excess hydrogen available in the market, combined with the current hydrogen prices and the forecast in the power industry for the development of a hydrogen market in the near and medium term, do not however give the right signal to the companies in the power sector to get involved in hydrogen production. Additionally, enhanced interactions with the materials research community can facilitate the development of new materials needed for efficiency improvements and cost reductions.