the coal gas is typically designed to burn
natural gas or oil as a backup.
It’s not an environmentally sustainable technology. Conservatively speaking,
there are domestic coal reserves that will
sustain coal consumption at current levels
for 250 years. This is an energy source
that cannot be ignored. In addition,
according to the Environmental Protection
Agency’s Environmental Technology
Council Coal Gasification Team, “IGCC,
which uses a gasifier to transform coal
(and other fuels) to gas, and then uses a
combined-cycle power block to generate
electricity, is one of the most promising
technologies to meet the challenge of
generating electricity from coal in an
environmentally sustainable way.” (For
more, go to www.epa.gov/environmental
technology/forum/problem/coal_gasifica
tion.html.)
Cost-Effective Solution?
If a university is building a new central plant or upgrading an existing plant
and needs to replace or add capacity, it
could achieve both a lower initial cost
and lower operating cost by using coal
gas. One contractor, for instance, provides an option for universities and colleges seeking this solution. It delivers the
gasification plant on a finance-design-build-operate business model with a 15-
year contract term, with no initial cost to
the owner. The contract with the process
provider is a ‘take-or-pay’ structure (fig.
1). That is, if the owner installs a 200
MMBtu/hr plant, it pays to process 200
MMBtu of fuel gas continuously throughout the year, whether the gas is taken or
not. The gasification company recovers
its capital cost through this processing
fee; thus, it behooves the owner to take
and use every Btu.
Is this a cost-effective solution? It
depends on the strategy used by the
owner. One alternative is to baseload with
fuel gas. Typically, a university has a 3-to-
1 ratio of winter-to-summer steam load. It
can burn fuel gas year-round at its lower
summer steaming rate and accommodate
the higher winter load using natural gas.
Although the load increases in the winter
when natural gas prices rise, this strategy
can yield a savings.
Another alternative is to use the
fuel gas in a gas turbine to generate electricity (i.e., cogeneration). The electrical
power produced can be utilized in a
variety of ways.
A third alternative is to level the
steam-load profile throughout the year
by driving steam turbine-driven chillers.
If a university is able to finance at
substantially lower-than-commercial
rates, then it may be able to negotiate a
contract that provides the equipment to
the owner and licenses the owner for use
of the technology. In that case, the take-or-pay structure does not apply, allowing
for operating flexibility.
Clearly, this is not a one-size-fits-all
solution. It is a complex economic problem that depends on the owner’s load
profile, the availability of relatively high-sulfur coal and the cost of electricity. A
feasibility analysis by a professional engineer and gasification company is the first
step in determining the viability of this
solution for an institution. Today, there
are plenty of examples that debunk the
old myths about coal gasification. For academic institutions, it may be well worth
investigating to determine if it is a feasible
alternative to high natural gas prices and
the specter of the MACT hammer.
Kevin Rhodes, PE, , is manager
of Woolpert Inc.’s Energy Utilities
Group in Cincinnati. The group’s
clients include Duke University,
The Ohio State University, The
Pennsylvania State University,
Purdue University, Clemson University and
Indiana University. An IDEA member, Rhodes
has more than 20 years’ experience in the
energy and construction industry. His work has
included gas, oil, coal and nuclear plants as
well as the planning, design and implementation of district utility systems. Rhodes can be
reached at kevin.rhodes@woolpert.com.
