For synergy in energy

There is vast potential for Indo-U.S. cooperation in the field of energy, but a carefully calibrated approach is essential in order to ensure optimal advantages.

A. GOPALAKRISHNAN

THE visit of U.S. President Bill Clinton to India is around the corner. On major issues of U.S. interest, it is now clear that India will not have much to offer Clinton. India is not ready to sign the Comprehensive Test Ban Treaty (CTBT), nor does it wis h to have any U.S mediation on the Kashmir issue. Both sides, therefore, are eager that this visit should not degenerate into an occasion for re-stating the generalities which are heard often. One way around this difficulty is to look for areas in which concrete bilateral cooperation can be initiated, in order to make the visit at least partly meaningful to both sides.

In October 1999, the U.S. President had sent his Energy Secretary, Bill Richardson, to New Delhi for initiating discussions on a renewed framework for Indo-U.S. cooperation in the energy field. While in India, Richardson is reported to have said, "There is a strong future for our relationship (with India) in various areas, especially in the energy sector. What is now needed is the political will to accelerate the energy sector reforms, including the restructuring of India's energy enterprises, establish ing independent regulation at the State and national levels, and being more open to competition". Richardson also noted that the U.S. government and energy firms were ready to help the South Asian region achieve regional energy integration, a step which will significantly improve the quality of life of the people in this part of the world.

However, after the encouraging hype leading up to the Richardson visit, the Indo-U.S. joint statement on cooperation in energy and related environmental aspects signed on October 26, 1999 in Delhi was certainly a let-down from the Indian point of view. W hile Richardson and the U.S. seemed to have taken care of specific U.S. interests, the Indian side certainly failed to include anything of particular value to the country. The statement indeed reflects a total lack of planning and preparation on the part of the Ministry of Power, which handles the overall subject of electric power as well as the production and utilisation of coal, which is India's major primary energy resource. The only consolation is a clause which states that the two governments, reco gnising the immense opportunities for fruitful cooperation in the energy sector, have decided to enhance further their cooperation in areas such as conventional energy projects, renewable energy, clean coal technology, energy efficiency and related envir onmental aspects. At the signing ceremony on October 26, 1999 Richardson is reported to have said that the U.S. was keen to step up scientific cooperation in the energy sector. He also said an announcement on expanding cooperation in non-nuclear areas be tween the national laboratories of the two countries would be made soon.

The opening to make a meaningful beginning on energy cooperation is available in the form of the joint statement. But India has to be specific now about the level and type of cooperation it is looking for. India has already wasted decades trying to get s omething useful in this sector from the U.S. It is now time to put forth ideas and proposals on substantial projects with commercial and long-term interest for the two governments and the energy industries in both countries. The sub-critical level of sci ence and technology cooperation between 'national laboratories' as envisaged by the U.S. is a meaningless diversionary tactic which can yield nothing much of value to India.

The focus here is on one major area of cooperation between the two countries, which is considered to be of the highest priority to India at this juncture.

Energy scenario in India

INDIA depends on both primary commercial energy sources such as coal, oil, natural gas, uranium and hydro-electric potential and non-commercial energy sources such as agricultural residue, firewood and animal waste. The share of non-commercial energy has declined from about 70 per cent in 1971 to almost 33 per cent in 1990 and it is declining further.

The major primary energy source available in India is coal. India has a total of about 205 billion metric tonnes of coal reserves, of which about 73 billion tonnes are proven reserves. About 15 per cent of these reserves are constituted by coking coal, w hich India cannot afford to use for power generation. Of the remaining, only 12 per cent is of superior grade, the rest being of poor quality with high ash content, in the 35-40 per cent range, and a low calorific value. The few coal washeries installed so far are mainly for coking coal, and it is unwashed coal that is supplied for thermal power generation. Almost 74 per cent of coal mining in India is done through the open-cast process, which also contributes to the high ash content.

Coal mining in India is uniquely inefficient. India's underground mines produce roughly 1.9 tonnes per man-shift, while the open-cast mines produce about 5.1 tonnes per man-shift. The corresponding figures in the U.S. are 19.3 tonnes and 47.7 tonnes resp ectively. The use of modern mining machinery, increased automation and modern procedures and practices are the reasons for such excellent performance.

Thermal power sector

The total installed capacity for electricity generation in the Indian utilities sector reached about 89,166 MW by March 1998: it consisted of 64,150 MW of thermal power (coal and gas), 21,891 MW of hydel power, 2,225 MW of nuclear power and about 900 MW of wind power. In addition, there is a contribution of about 12,500 MW from the non-utility sector. Coal is predominantly the primary fuel used for electricity production: it accounts for about 64 per cent of the power generated.

The use of inferior-quality coal, combined with inefficient mining and transportation methods, has plagued the power sector for long. Over the years, most of the imported power plant technologies and equipment had to be modified and indigenously redesign ed to suit the peculiarly low quality of Indian coal. Bharat Heavy Electricals Ltd (BHEL), a major public sector power company, has done substantial research and development (R&D) work related to making changes in the designs of boiler and boiler auxilia ries it obtained from Combustion Engineering (USA) and others. Concurrently, the National Thermal Power Corporation (NTPC) has been able to achieve plant load factors in excess of 90 per cent in some of its power stations, using Indian coal with 35-40 pe r cent ash content and equipment and systems modified and supplied by BHEL.

Clean coal technology development

As early as mid-1970s, BHEL recognised the need to develop indigenously alternative coal utilisation technologies such as atmospheric and pressurised fluidised bed combustion and moving bed and fluidised bed coal gasification for the efficient use of hig h-ash Indian coal in the power sector. The major incentive and reason for this effort was the ground reality that conventional pulverised coal boilers were resulting in highly inefficient and unreliable operation when fed with poor-quality coal.

The national laboratories of the Council of Scientific and Industrial Research (CSIR), such as the Central Fuel Research Institute (Dhanbad) and the Indian Institute of Chemical Technology (Hyderabad), had also carried out laboratory-and-pilot-plant scal e work in these areas since the mid-1960s. Making use of these inputs, BHEL first developed and commercialised indigenous atmospheric fluidised bed boilers of up to 30 MWe capacity, with multi-fuel capability, which could burn even agro-waste and washery middlings. By 1985, BHEL developed, built and successfully tested both a moving-bed coal gasifier of 150 tonnes of coal a day capacity and a fluidised bed coal gasifier of the same rating. Furthermore, it demonstrated the operation of the moving-bed gas ifier in a combined-cycle power generation mode in a 6.2 MWe test station at its Tiruchi (Tamil Nadu) unit. The fluidised-bed gasifier is currently under integration at this facility for similar operational testing.

Unfortunately, neither BHEL nor the CSIR laboratories could further advance their early pilot-scale efforts through the setting up of suitable demonstration plants. Ideally, a 100-150 MWe Integrated Gasification Combined Cycle (IGCC) demonstration plant, based on Indian high-ash coal, should have been set up and operated in order to understand the problems and to refine the design suitably, before scaling it up. This should have been the appropriate culmination of decades of coal utilisation research by BHEL and the CSIR laboratories. But neither the Ministry of Power, nor Industry nor Science and Technology has shown any interest in doing this. The BHEL and CSIR managements have also not taken any bold initiatives in this direction. Liberalisation and the push towards the privatisation of the power sector since the 1990-91 period could have been used effectively by the government and industry to promote concurrently the implementation of innovative coal utilisation schemes of specific significance to India. But, instead, the tendency has been to take the easy route away from coal and towards the increased use of liquid fuels and natural gas for power generation, for which the country has limited primary energy resources.

Even under the assumption of a reasonable growth in the demand for electricity and a moderately high share of coal-based power generation, India's presently known coal reserves will last for about 80-100 years. One, therefore, comes to the unavoidable co nclusion that the development and improvement of the coal sector and clean coal technologies specifically relevant to India must be at the core of its plans to ensure energy security for the coming decades. Here, India must look for integrating its indig enously acquired skills and technologies with appropriate technological and financial inputs from abroad, which will help accelerate further growth. The opportunity to develop Indo-U.S. energy cooperation in this field should, therefore, have the highest priority in this context.

Directions of growth

While developing plans, it is necessary to evaluate the direction of progress which the leading power companies of the world are currently following. The world over, many combined cycle gas turbine (CCGT) power plants have come up since 1990, using natur al gas or liquid fuels as feed stock. This mode of power generation, using clean gaseous or liquid fuels, offers conversion efficiencies as high as 55 per cent, from fuel energy content to electrical energy output. This efficiency may reach as high as 60 per cent in the future, with improvements in gas turbine designs and materials, as against a maximum of 40-42 per cent efficiency one can at present get with very low-ash, pulverised coal burning stations. In contrast, with Indian coal, the pulverised c oal-burning stations now give only 32-34 per cent conversion efficiency.

In a combined cycle system, power generation at the high-temperature front-end takes place in a gas turbine-driven generator, where the gas turbine is powered with either natural gas or liquid fuel (CCGT) or from a coal gasification plant, as in the case of the IGCC system. CCGT plants are less capital-intensive than pulverised-coal burning stations and have much higher conversion efficiencies and potentially lower gestation periods, but they require a lot more cooling water than conventional coal-based stations. The water requirement can be reduced to some extent by opting for air-cooled heat-exchangers and condensers.

In the IGCC technology, coal will be gasified in an air-or oxygen-blown gasifier, in the presence of steam, in a high-pressure unit. The raw gas will be thoroughly cleaned and admitted to the gas turbine as fuel. The hot gases coming from the gas turbine will be used to generate steam in a heat-recovery boiler, to drive the steam turbine unit. The overall conversion efficiencies could be up to 46 per cent with low-ash coal and the current gas turbine technology, but with the poor-grade Indian coal and w ith the present turbines it could be as low as 40 per cent.

Independent Power Producers (IPPs) are already involved in the construction of six CCGT plants in various parts of India. They include the Dabhol Phase-1 Project (740 MW), Essar's Hazira Project (515 MW) and the Gujarat Torrent Energy Project (655 MW). A ll of them use clean, high-calorific value, gaseous or liquid fuels, but not coal. Interestingly, U.S. companies such as GE, Westinghouse and Allison (USA) are already participating in these projects as equipment and systems suppliers.

An important point to note is that there is no commercial coal gasification technology available anywhere in the world at present that will efficiently convert the high-ash Indian coal to a fuel gas. But U.S. companies such as Texaco and KRW and European companies such as Lurgi have a great deal of experience with commercial-scale gasification plants operating on higher-grade coal with an 8-10 per cent ash content. The much higher ash content and the peculiar chemical and combustion properties of Indian coal will necessitate substantial modification of the technologies already available with foreign companies to suit Indian fuel resources. BHEL and the CSIR have acquired significant experience and knowledge in coal gasification up to the pilot-plant sc ale, specifically with high-ash Indian coal. Besides, the NTPC and BHEL have gained the system engineering and project implementation experience that is needed to set up and maintain combined cycle plants. The use of this existing Indian know-how and exp erience will be essential in setting up a first-of-a-kind IGCC plant of 300-500 MWe capacity in India, fed with Indian coal. Such a project could be a major challenge for consideration as part of the Indo-U.S. energy cooperation for the coming decade.

Proposed project

The Indo-U.S. IGCC demonstration project proposed here must have both BHEL and the NTPC as partners from India. The U.S. partners must include a power sector company which has had some exposure to India, like Enron and a Texaco/KRW-type clean-coal techno logy company with gasification experience. The Electric Power Research Institute (EPRI) in the U.S., the CSIR and others can be associated with it in advisory roles. Initial investments must come from all principal parties, including BHEL, the NTPC and t he participating U.S. industries. A consortium of these principal partners could serve as the IPP selling power, under a suitable Power Purchase Agreement (PPA), to the government of India. The Ministry of Power and the U.S. Department of Energy should s erve as facilitators and overall monitors, but the responsibility of project execution management must rest with the industries. Since BHEL and the NTPC are public sector entities, part of their initial investments in this project may have to come from t he Indian government. Similarly, the U.S. companies may have to be assisted by their government through the grant of Exim Bank loans to offset their investments partly.

India must recognise that certain technologies and equipment will have to be developed freshly under this project, and the future exploitation of and patent rights for these innovations should be equitably shared among all partners. Protection will also have to be granted to already developed know-how that each partner brings into the project as its contribution. But, under no circumstances can India agree to leave the project entirely to the U.S. entities. It is in India's interest that a project of th is nature must have the active participation of BHEL and the NTPC as partners.

The two governments could also consider associating a coal mining company from the U.S. as a partner in this project. Part of the much-needed improvements in the coal mining sector can then be attempted in a small scale, by allotting a suitable mining ar ea on long-term basis for this project and by asking this mining industry partner to take full charge of the mining and supply of the coal required for the plant. If a productive high-ash-coal mine area is given to it, a demonstration of current U.S mini ng technology, equipment and practices could be available through this effort for implementation elsewhere in the country. Such a project, integrated from mining to ash disposal, can be organised and implemented to the mutual satisfaction of both governm ents and the industries concerned, with suitable inter-party agreements among the partners to ensure the workability and future expansion of these activities. When detailed techno-economic studies are carried out, it may also become evident that the sett ing up of a coal gasification plant solely for power generation through the IGCC route is not quite profitable. If part of the coal-gas produced is used also for the production of other high-value end products which are marketable, the overall economics may work out much better. Industrial concerns and energy research institutions in the U.S and India have already started looking into the feasibility of such approaches. Perhaps this possibility of extending the scope of the demonstration project beyond the IGCC application may prove worthwhile in the long run.

Considering that the utilisation of India's large reserves of high-ash coal for electric power generation through appropriate clean-coal technologies is of the highest interest to the country, there is a strong case for a joint demonstration project in this field, under the Indo-U.S. energy cooperation agreement. It is hoped that the governments of India and the U.S will develop it into a viable reality through suitable measures during and after the Clinton visit. A project of this nature could be enor mously beneficial to both nations, and it could be the corner-stone of fruitful Indo-U.S. technological cooperation in the coming decades.

Dr. A. Gopalakrishnan was Executive Director (Research) in Bharat Heavy Electricals Limited and subsequently Chairman of the Atomic Energy Regulatory Board.