From the rapidly expanding suburbs along Colorado’s Front Range to the booming desert cities of Phoenix and Las Vegas, the demand for electricity across the West is growing.
As much as 28,000 megawatts of new power plants and energy savings likely will be needed in the interior West by 2020 to meet the region’s own electricity demands and to continue supplying power to California and the Pacific Northwest.
For the past 30 years, the region has relied primarily on coal to power our homes and businesses. Today, despite a boom in natural gas power-plant construction over the last decade, coal plants generate nearly 70 percent of the electricity produced in the region. While these plants have provided relatively low-cost, reliable power, they have also come with a high environmental price tag and much controversy.
As we move into the 21st century, an undeniable challenge facing our region is how to meet our growing electricity needs in ways that not only maintain a vibrant economy but also protect our environment. Meeting this challenge will require dramatically increasing our reliance on clean, cost-effective energy efficiency resources and renewable wind, solar, geothermal and biomass power. To the extent that coal plays a role in meeting new power demands, we must find ways to minimize its environmental impacts.
Old-style pulverized coal plants are not the answer. In these plants, coal is crushed and then burned in a boiler to make steam, which spins a turbine to generate electricity. Even with expensive air-pollution controls, these plants emit significant amounts of sulfur dioxide and nitrogen oxides, which cause health problems and hazy skies; mercury, which can work its way up the food chain to poison fish, other wildlife and even people; and carbon dioxide, a major global warming gas.
But, a newer, more advanced technology holds enormous promise for using our region’s abundant coal resources while protecting human health and the environment. Integrated gasification combined cycle technology, or IGCC, is a process for gasifying coal and then burning the gas in a turbine to produce electricity. Excess heat, instead of being wasted, is recycled to make steam to generate additional power. This dual process makes IGCC power plants more efficient than pulverized coal plants, so that it takes less coal to generate the same amount of electricity.
Because most of the impurities in the coal are removed during the gasification process, the technology also results in far less air pollution and solid waste. IGCC power plants also use 30 to 50 percent less water than pulverized coal plants, an advantage in the arid West. But perhaps most important, IGCC plants lend themselves to the capture and storage (or “sequestration”) of carbon dioxide at much lower cost than pulverized coal plants. This can help us turn down the heat on global warming in an economically sensible way.
IGCC technology is commercially established and marketed by major companies such as GE, Shell and ConocoPhillips. There are two full-scale IGCC plants operating in Florida and Indiana, as well as facilities in Europe and Japan.
But with all its promise, a number of challenges must be overcome before IGCC plants are deployed in the West.
One challenge is cost. Analysts estimate that the cost of generating electricity from an IGCC plant is currently about 10 percent higher than from a pulverized coal plant. However, the cost is roughly 20 to 30 percent lower when the cost of capturing and sequestering carbon dioxide is considered.
Yet, despite the scientific evidence that fossil fuel combustion is contributing to global warming, our government currently does not require power plants to control carbon dioxide emissions. Consequently, this important IGCC advantage goes unrewarded. And, although many in the power industry believe that carbon dioxide emissions eventually will be regulated, uncertainties regarding the timing and stringency of those limits have deterred Western power companies from moving rapidly ahead on IGCC.
A second challenge is that there is a limited track record for using Western coal in IGCC plants. The successfully operating IGCC plants in Indiana and Florida use eastern coals, which have different chemical and physical characteristics than most coals found in the West. While there is no reason to think that Western coals cannot be reliably and economically used in IGCC power plants, until someone uses Western coal in a utility-scale IGCC plant uncertainties regarding economics and operating performance will inhibit investments in IGCC projects in our region.
To overcome these challenges, one or more IGCC power plants using Western coal need to be constructed. Deploying such facilities will allow power providers to gain experience with the technology and optimize its design and performance. This can help drive down costs on future plants and will demonstrate the viability of IGCC with Western coal.
Energy policymakers are beginning to take action to spur the deployment of IGCC power plants in the West. Thanks to the efforts of Sen. Ken Salazar from Colorado and Craig Thomas from Wyoming, the Energy Policy Act of 2005 contains provisions that offer federal grants and loan guarantees for IGCC projects developed in the West. Recognizing the benefits of IGCC, the Colorado General Assembly recently passed, and Gov. Bill Owens signed, legislation that would allow power companies to develop an IGCC plant, even if the near-term costs were somewhat higher than other options, provided the project is approved by the Public Utilities Commission. In Wyoming, whose economy is heavily dependent on coal production, the Infrastructure Authority was recently allowed to extend financial incentives to IGCC facilities.
Making the shift from conventional pulverized coal technology to IGCC is not risk- or cost-free. But it looks very much like a bargain, not only environmentally but also economically, especially in future years, when our nation likely recognize the need to reduce carbon dioxide emissions.
John Nielsen is the Energy program director for the Western Resource Advocates
