Tag Archives: coal in China

Finding Opportunities for CCUS in China’s Industrial Clusters

Zhang Jiutian
Administrative Center for China’s Agenda 21,
Ministry of Science and Technology (MOST)
Zhang Xian
Associate Professor,
Administrative Center for China’s Agenda 21, MOST
Peng Sizhen
Deputy Director General,
Administrative Center for China’s Agenda 21, MOST

The government of China considers addressing climate change to be of the utmost importance. Therefore, the country is exploring how to best approach low-emissions development through innovation and intends to do so even as it pushes ahead with urbanization and industrialization.

Recently China has placed a major emphasis on the research, development, and demonstration of carbon capture, utilization, and storage (CCS and CCUS), while also promoting energy conservation and reducing criteria emissions. Based on geography, economics, technical considerations, and other factors, the Administrative Center for China’s Agenda 21, responsible for carrying out China’s efforts under the United Nations Agenda 21 plans for sustainable development, has found that there are several optimal opportunities for CCUS in China. The best prospects are focused around pairing key industries responsible for 90% of the country’s emissions from coal use (i.e., coal-fired power, coal-to-chemicals, and steel and cement production) with specific CCUS opportunities to advance low-emissions technology deployment in the country.

Industrial clusters, including China’s growing coal conversion industry, could support the development of a CCUS industry.

Industrial clusters, including China’s growing coal conversion industry, could support the development of a CCUS industry.


In late June 2015, China officially submitted its Intended Nationally Determined Contributions (INDCs) ahead of COP21. The major commitments include peaking carbon emissions by 2030, while striving to do so sooner, and reducing CO2 emissions per unit of GDP by 60–65%, compared to 2005 levels. These ambitious commitments demonstrate the country’s desire to be proactive on climate change mitigation. They also support domestic efforts to expand investigation and innovation of low-emissions development models and pathways.

When making its international commitments on climate and working to advance low-emissions technologies, China must take into account that it is a developing country with a population of more than 1.3 billion people. Thus, the country must balance sustainable economic development, poverty eradication, urbanization, industrialization, the desire to improve standards of living, limited resources and energy supplies, and environmental protection. In terms of reducing carbon emissions from coal, China has opted to focus largely on CCUS in the near term to provide some revenue and/or co-benefits from low-emissions technology deployment.

Addressing emissions from the coal-fired power sector is especially important, considering that China has large coal reserves with relatively small reserves of oil and natural gas. The country is working to expand deployment of many low-emission energy options, but it is not possible for China to fundamentally change its coal-based energy mix in the near future. Any drastic change in the energy consumption structure would inevitably worsen China’s energy security and would directly and negatively impact economic growth. Based on forecasts, the proportion of coal, oil, gas, and other energy sources (e.g., nuclear power and renewables) in China’s primary energy mix are expected to be 55%, 20%, 10%, and 15%, respectively, in 2020.1 Therefore, low-emissions coal utilization must be developed and deployed in China.

CCUS is also of high interest to China because it can increase domestic production of valuable resources, such as minerals, oil, natural gas, uranium, and water. Thus, CCUS presents a key opportunity to enable cross-industry collaboration to form a framework for an emerging low-emissions industrial structure, thereby balancing China’s development and environmental objectives.


The international community, especially developed countries, has also been increasingly interested in CCUS. In addition to the emissions reduction benefits of CCUS, countries such as the U.S., the UK, Australia, and Canada have set their sights on the considerable market benefits offered by this suite of technologies.

China specifically is actively pursuing research, development, and demonstration of CCUS, which is included in five-year plans and other government documents that cover climate change. For example, the importance of developing CCUS was emphasized in documents and national guidelines such as the Medium- and Long-Term Program for Science and Technology Development (2006–2020), the National Program for Addressing Climate Change in China, the 12th Five-Year Plan for Science and Technology Development, the 12th Five-Year National Plan for Science and Technology Development to Address Climate Change, and the 12th Five-Year Plan for Carbon Capture, Utilization, and Storage Technology Development.

There has been recent progress in advancing CCUS in China. Since the end of the 11th Five-Year Plan, China’s government has supported research and development work carried out by domestic colleges, universities, and research institutes as well as large power, petroleum, and coal companies. This work has laid the foundation for a CCUS industry—and includes launching the country’s largest CCS project in operation to date, Shenhua’s 100,000 tonnes/annum (tpa) full-process demonstration project for CO2 capture, transportation, and storage in saline aquifers. Other major research, development, and demonstrations related to CO2 utilization are listed in Table 1.

Peng Table 1

Today China has developed a pathway for the deployment of CCUS and technologies to use CO2 to produce various resources. However, large-scale full-process demonstration projects over one million tpa in size have yet to be carried out in the country. Thus, to achieve a commercial CCUS industry in the near future the challenges of high costs, lack of maturity of some key technologies, and a lack of complementary facilities and related policies must be addressed. The near-term advancement of the technology is critical.


In 2013, China’s Ministry of Science and Technology’s Administrative Center for China’s Agenda 21 took the lead in conducting a comprehensive scientific assessment of CCUS technologies in China, and published the results in 2014.1 In this report, the emissions reduction potential and benefits of different CCUS technologies in China were assessed.

Based on the current policies and technology development trends—and as CCUS technology demonstration and industrialization plans are ramping up—enormous potential exists for increased deployment and emissions reductions (see Table 2). If there is expanded policy support and investment for CCUS, greater deployment and the resulting emissions reductions could be achieved sooner, in addition to achieving the broader economic and social benefits.

Considering the large potential revenue and emissions reductions, CCUS should, first and foremost, be applied to reduce emissions from China’s coal-fired power, coal-to-chemicals, and steel and cement production sectors. Integrating CCUS projects could form industrial clusters of emissions reductions across these different industries and reduce net costs.


China possesses several characteristics that are important for growing a successful CCUS industry, including CO2 emissions that are largely clustered around industrial centers, diverse geology, proximity of sources and sinks, and commodity prices high enough to help support CCUS projects. Through systematic planning, pathways for CCUS project development in China have been identified.

The first opportunity identified is associated with using CO2 from coal-fired power plants to enhance oil recovery (CO2-EOR) and enhance water recovery (EWR). The water produced in EWR could be further processed to extract valuable minerals, such as lithium salts, potash, and bromine, and also simply to produce usable water (treatment would be required) as many coal-fired power plants are located in regions of the country where water scarcity is higher. There may also be opportunities to use CO2 from some steel and cement production facilities for these purposes.

CO2-EOR is a near-term CO2 utilization opportunity being pursued in China.

CO2-EOR is a near-term CO2 utilization opportunity being pursued in China.

Another potential CCUS opportunity is to use the relatively pure CO2 from coal conversion processes in China, such as the production of synthetic natural gas, for enhanced coalbed methane (ECBM) production. In addition, the captured CO2 and newly produced methane could be combined with coke oven gas (H2 and CH4) to generate a feedstock to produce syngas, liquid fuels, methanol, etc.

Yet another CCUS opportunity is related to using the lower concentrations of CO2 generated during steel and cement production. Such CO2 could be used for the mineralization of bulk solid wastes (such as slag and phosphogypsum), generating value-added materials. In addition, low-concentration CO2 can be used directly for the cultivation of microalgae. The cultivated microalgae can be used for fertilizer—particularly suitable for treating the saline-alkali and desert soils in China. This would have a co-benefit of increasing carbon fixation in soil. Oils from the microalgae could also be used in fuel production and in the chemical production industries, although this work is quite preliminary.

Although some core CCUS technologies are at an early stage of research and development, these technologies hold value for improving China’s energy security, benefitting the environment, reducing emissions, providing new sources of economic growth, growing emerging strategic industries, and improving national competitiveness.

Based solely on the development status of CCUS today, the potential for emissions reductions and the economic benefits of various CCUS options as forecasted in 2030 are shown in Table 3.1 If there is expanded policy support and constraints in the market are reduced, CCUS technologies that are still being researched, developed, and demonstrated could mature more quickly and enter the market sooner, resulting in even greater benefits.

Peng Table 3


The development of a CCUS industry is an important way forward for reducing emissions in China. New industrial clusters could potentially develop into foundations for economic growth, promoting sustainable socioeconomic development. To realize this potential, the Administrative Center for China’s Agenda 21 makes several recommendations:

  1. Conduct a systematic assessment of the costs, safety, environmental aspects, and other factors related to CCUS in China, especially in regions with better conditions for early CCUS demonstrations, such as the Ordos Basin, Songliao Basin, Bohai Bay Basin, and Junggar Basin. This will give a more accurate understanding of the potential for CCUS in the country.
  2. Due to the lower capture cost, concentrated sources of CO2, such as from the coal-to-chemicals industry, should be used initially as the source of CO2 for CCUS demonstrations. When considering technologies, attention should be given to increasing energy efficiency through integration of CCUS with existing processes, and thus decreasing coal consumption. For example, efficiency may be achievable through integration of CCUS with the production of synthetic natural gas. Potential opportunities include achieving breakthroughs in the core technologies, such as gasification.
  3. Certainty must be increased around the prospects of the large-scale, commercial application of post-combustion capture, pre-combustion capture, and oxy-fuel combustion technologies. Thus, these three CO2 capture options should be demonstrated and integrated with the demonstration and scale-up of CO2-EOR, CO2-EWR, and onshore saline aquifer storage to achieve several demonstration projects with a scale of more than one million tpa by 2020. In addition, the demonstration of other integrated systems could simultaneously be advanced through knowledge sharing based on these full-process CCUS demonstrations.
  4. In terms of CO2 recycling, the research, development, and demonstration of CO2 mineralization and key technologies for CO2 bio-utilization (i.e., microalgae) should be enhanced. Early demonstrations of such technologies are being carried out today at a relatively small scale, and development of such technologies using CO2 from the steel and cement industries should be considered.
  5. By fully leveraging the common technical features of CO2-EOR and storage of CO2 in saline aquifers, research and development efforts for specialized technologies related to ECBM and the output of water-soluble minerals should be increased. Relevant integrated demonstrations should be identified and supported.

In conclusion, CCUS is an important way forward to reduce CO2 emissions in China. Integration of key technologies can reduce costs and uncertainty, allowing CCUS to play an important first step in reducing the country’s emissions.

A. Conversions based on exchange rate of US$1 = 6.4 RMB as of 17 August 2015.


  1. Administrative Center for China’s Agenda 21. (2014). China’s CO2 utilization technology review. Science Press, www.ccuschina.org.cn/uploadfile/Other/2013112016112758287773.pdf


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Considering the Challenge of China’s COP21 Commitments: An Exclusive Interview With Jonny Sultoon of Wood Mackenzie

By Li Xing
Executive Editor, Cornerstone

As Research Director of Global Coal Markets for Wood Mackenzie, Mr. Sultoon directs analysis and research for various aspects of the global coal market. His areas of expertise are in short- and long-term demand forecasting for the international coal markets, competition between fuels in the power generation sector, corporate analyses of the major producers and utilities, and fundamentals-based price forecasting for the coal market. He previously served on Wood Mackenzie’s European Gas and Power Research team after five years with Gas Strategies Consulting. Mr. Sultoon holds a BA and MA in Physics from the University of Oxford, UK.

Jonny Sultoon, Research Director of Global Coal Markets for Wood Mackenzie

Jonny Sultoon, Research Director of Global Coal Markets for Wood Mackenzie

Wood Mackenzie, a research and analytics group, since its acquisition of a coal-focused group in 2007 has been developing forecasts around global coal markets. China, in particular, has a dynamic coal market, which has grown rapidly until very recently. Lately, China’s coal market has been weak and could be further affected by regulations and the country’s commitment on climate. China’s commitments for COP21 may not be surprising as they largely reflect the landmark joint announcement in November 2014 between Presidents Obama and Xi Jinping. A key element of that announcement, and of China’s Intended Nationally Determined Contributions (INDCs), is President Xi’s pledge that “carbon pollution will peak some time before 2030”. This commitment was followed up separately in June 2015 by a further set of pledges, namely:

  • Cut CO2 emissions per unit of GDP by 60 to 65% by 2030 from 2005 levels;
  • Increase non-fossil fuel in primary energy consumption to around 20% by 2030;
  • Achieve 200 GW of wind power capacity by 2020;
  • Achieve 100 GW of solar power capacity by 2020;
  • Increase the proportion of concentrated and highly efficient electricity generation from coal;
  • Lower coal consumption of electricity generation from newly built coal-fired power plants to around 300 grams coal equivalent per kWh;
  • Strengthen research and development (R&D) and commercial demonstration for low-carbon technologies, such as energy conservation, renewable energy, advanced nuclear power technologies and carbon capture, utilization, and storage, and to promote the technologies utilizing CO2 to enhance oil recovery and coal-bed methane recovery;
  • Build on carbon emission trading pilots, steadily implementing a nationwide emission trading system and gradually establishing the carbon emission trading mechanism so as to make the market play the decisive role in resource allocation.

Cornerstone sat down with Mr. Sultoon to discuss the fundamentals of coal consumption in China, the major challenges he sees with the country’s COP21 pledges outlined above, and the role technology can and should play.

Q: With China’s recent economic slowdown and transitioning energy mix, do you believe the historical, fundamental link between coal and the country’s development is weakening?

A: China’s thermal coal market appears to be at a turning point. After a decade-long period of untrammeled growth—supported by economic advancement, migration of workforce to coastal provinces, higher standards of wealth, and growth in imports of raw materials to serve China’s massive industrial complex—Chinese coal demand has softened. A complex set of reasons is at its heart: slowing GDP growth (to around 7%), transformative change in the drivers of growth, wildly shifting energy consumption patterns, increasing penetration of non-coal-fired capacity (hydro and renewables), implementation of strict environmental targets across coastal provinces, and a concerted effort to relocate energy-intensive industries to the interior.

2013 likely saw peak coastal thermal coal consumption of 1.2 billion tonnes. In 2014 nationwide demand fell 2–3% y-o-y, depending on accounting methods. There are a combination of structural and cyclical factors at work in China’s complex, dynamic, and regionally fragmented market.

Coal consumption on China’s coast may have already reached a peak.

Coal consumption on China’s coast may have already reached a peak.

China’s economy—historically intertwined with the coal industry—is in a key phase of transition. The services sector overtook industry to become the largest share of GDP in 2013, and the slow, gravitational shift from China’s east to west is well underway. In the short term, policy remains the key driver of economic growth as the government balances between supporting growth and implementing reforms.

As investment growth slows, we expect services to continue to grow as a share of GDP as China rebalances its economy toward domestic consumption and encourages the development of higher value added activities such as R&D and financial services. This transition from industry toward services will have significant implications for China’s overall energy demand growth as well as regional demand patterns since most commodity demand—including that for power, coal, and diesel—is heavily dependent on industrial growth.

Q: Can you give us a snapshot of the state of the major coal-consuming industries in China?

A: China’s power market output in 2014 was approximately 5500 TWh, with 3.8% growth over 2013 levels. This gain represents slower growth based on economic restructuring and weaker heavy industrial output. For the first time ever, elasticity—the ratio of change in electricity generation over a period of time associated with a one unit change in GDP over the same period—fell to 0.5. This “decoupling” effect is complex. The growth in contribution of services at the expense of industry is crucial as is the state of overcapacity in the industrial sector. As that state of overcapacity remains while the share of heavy industry falls a degree of decoupling is to be expected. Going forward, we expect elasticity will appreciate slightly at first but will remain at far lower levels than historic norms. Overall, we forecast total electricity to rise by an average y-o-y growth rate of 4.8% between now and 2030, reaching 11,600 TWh. Although this is a doubling of electricity generation, electricity usage would still reach just 8 MWh per capita from 4 MWh per capita today, which is on a par with the modern-day, energy-efficient performance in Germany and Japan. This improvement is a tall order for a country 10–15 times more populous and at a much earlier stage of development. A more obvious comparison would be with the U.S., undergoing its own energy-efficiency revolution, but starting from a wildly inefficient 12.4 MWh per capita in 2015.

Looking at the industrial and non-power sectors, there is still a large demand for thermal coal. The fuel is used to fire cement kilns, generate electricity at smaller industrial boilers for heavy industry and agriculture, and heat homes and commercial properties. There is also demand from coal-to-chemicals conversion projects in the interior of China. The non-power sector represented nearly 50% of total thermal coal demand in 2014, approximately 1.7 billion tonnes. To put that in context, the entire U.S. power sector will represent only half that amount in 2015.

However, one key focus area behind environmental policy has been to target the less efficient non-power sector where energy efficiency of industrial boilers is low and emissions register high. Controls over cement production in northern regions, strict penalties for misuse, and shutdowns of underutilized, inefficient boilers in heavy urban and industrial areas will reduce thermal coal demand in the non-power sector. In China’s Energy Development Strategic Action Plan released last November, the country aimed to raise the share of centralized coal power penetration in industry to over 60% from today’s 52%, by phasing out dispersed, small coal-fired facilities in commercial and industrial sectors.

Also, although the coal-to-chemicals conversion pipeline is strong, the recent fall in oil prices reduces the economic viability of those projects. In addition, such projects have tended to cluster in arid areas and the known high water requirement for conversion projects will add to cost and uncertainty. The April announcement of a Water Pollution Prevention and Control Action Plan will largely target the non-power sector and especially the chemical conversion sector. In July, the NEA set new stricter standards for coal conversion projects too, permitting a maximum limit of tonnes of coal for each tonne of oil or gas produced, as well as encouraging a reduction in the use of lower quality, high-ash, high-sulfur coals elsewhere. Finally, the Ministry of Environmental Protection recently rejected a Xinjiang coal-to-gas (CTG) project based on concerns regarding wastewater treatment and emission controls. CTG growth could be much lower than expected and there is much scope for reduced non-power demand for thermal coal.

While the coal conversion pipeline is strong, low oil prices will challenge future development.

While the coal conversion pipeline is strong, low oil prices will challenge future development.

Q: With coal consumption in the power sector to remain strong, improving the efficiency of coal-fired power plants could help China meet its goal of capping emissions by 2030. Do you feel that China’s goals related to supply-side energy efficiency can be achieved?

A: While China’s contribution is a major milestone in climate negotiations, we believe there are major challenges related to peaking emissions by 2030. Doing so will require some dynamic shifts and could lead to widespread disruption across multiple segments.

First, looking specifically at China’s COP21 pledge to reduce the coal intensity of electricity from newly built coal-fired power plants to around 300 grams coal equivalent per kWh (gce/kWh) is important. We assume that the figure refers to “standard coal” having 7000 kcal/kg energy content, which is well above average coal kcal in China. We estimate that current norms for power plant energy intensity are around 320 gce/kWh on average and will improve in future. The country has already greatly improved the efficiency of its coal-fired power fleet, but more upgrades will be necessary to meet COP21 commitments.

Improving efficiency to 300 gce/kWh would require ultra-supercritical (USC) boilers as the norm, with water cooling instead of air cooling condensers (ACC) which typically result in a 4–5% energy penalty. However, coal-fired power units in provinces with limited freshwater (Shaanxi, Shanxi, Inner Mongolia, Xinjiang) are mandated to use ACC technology, which helps to save up to 80% of freshwater demand in power plants. Given that a typical ACC coal plant consumes 12–13 gce/kWh more fuel than units using conventional water cooling, a realistic new coal-fired plant in inland provinces (with ACC) would be around 315 gce/kWh. Elsewhere, integrated gasification combined-cycle (IGCC) is comparable to USC in efficiency terms, but is not a commercially-mature technology. Thus, while China has taken great strides in improving the efficiency of its coal-fired power plants, additional progress will be required to meet its goal of 300 gce/kWh as the norm.

Q: China’s INDCs covered the role of high-efficiency, low-emissions (HELE) technologies to reduce the country’s carbon emissions. Will the greater deployment of HELE technologies have an impact on air quality in China?

A: In addition to the carbon-focused pledges related to COP21, the country has also aimed to improve air quality by reducing criteria emissions. Realizing that the coal consumption reduction targets were very aggressive, government emphasis has been directed toward emission control equipment for utility-scale units. Provincial governments have also been very active, getting a better grip on implementation of ultra-low emissions technologies through the use of local policies. The attention so far has been focused in Bejing, Tianjin, and Hebei and the Yangtze and Pearl River deltas which are considered to be the most critical regions with air quality issues. Guangdong, Zhejiang, Shanxi, and Jiangsu provinces have announced specific policies to ensure that all grid-dispatched coal-fired power plants (existing or new-builds) greater than 600 MW in unit size (300 MW for Shanxi) comply with ultra-low emission standards for particulate matter (PM), SO2, and NOx. Hebei, Shanxi, and Jiangsu will fast-track compliance in the 2015–2017 timescale while the implementation timeline for other provinces varies from 2017 to 2020. The emission levels are very stringent; similar to or even lower than gas-fired power stations. In return, the plants will receive a combination of incentives to cover additional CAPEX and OPEX requirements. Options proposed include preferential dispatch or tariff premiums for ultra-low emission units, direct subsidies on CAPEX, and dispatch award/penalty of 100–200 hours for compliance/non-performance. These steps should improve air quality in the affected regions.

Q: Deployment of non-coal sources of energy are an important part of China’s COP21 commitments. Do you see any challenges for that sector?

A: The goals of 200-GW wind and 100-GW solar capacity by 2020 are broadly comparable with our analysis and appear to be achievable; but what matters is generation output. Yes, the power sector is clearly shifting to lower emission energy sources, which are responsible for contributing more than half of new capacity additions over the past five years. But in terms of generation output, given de-rates, these levels will still be quite small compared to those from coal and hydro.

Hydro additions through dam hydro and pumped storage continue, with an on-average 20 GW of new capacity each year through to 2025. China has had great success commissioning large hydro projects commercially but guaranteeing repeated success given that the additions are slightly less than the equivalent of a Three Gorges Dam every year for the next decade looks to be a stretch, especially when considering the social implications and technical feasibility of designing and deploying that size of capacity repeatedly. What hydro does provide, though, is a summer peaking supply, and this has already begun to disrupt coal demand in key coastal provinces in a weak market.

Perhaps the greatest difficulty is around nuclear deployment. The lowering cost of building new wind and solar plants will, of course, be additive on a capacity basis, but to truly displace growth in baseload coal-fired generation, China will need to make good on its target of 200 GW of nuclear capacity by 2030, as outlined in its low-carbon roadmap in 2014. Following the Fukushima disaster in Japan, China tightened safety requirements for nuclear power. Approvals for new reactors in coastal regions were suspended and proposals for inland nuclear plants deferred until 2016 at the earliest. Though coastal approvals resumed in March 2015, nuclear faces an array of challenges throughout the value chain including limited domestic uranium supplies, unproven third-generation technology, fluctuations in quality and production capacity for key reactor components, a significant lack of experienced reactor operators, and limited capacity for spent fuel reprocessing and storage. In addition, the public debate on nuclear hasn’t started in earnest and the cost and social implications could be enormous. As of June 2015, 27 reactors were under construction and it is likely that nuclear capacity growth from 26 GW at the end of 2015 to 50 GW by 2019 can be achieved. But these limiting factors will constrain growth of nuclear power beyond that time. We tentatively forecast that China will add an additional ~155 GW by 2030 (180 GW total), but that may be optimistic and will, in any case, need to be greater if China is to successfully peak its CO2 emissions no later than 2030.

Carbon capture and storage is another key technology that could dramatically reduce CO2 emissions around the globe. Of all possible places in the world where CCS might be deployed on a significant scale, China seems most likely, given its policy-driven, rather than market-driven, approach to growth. Also, CCS is effectively labeled in one of the country’s COP21 pledges. However, the demonstration and deployment of the technology is currently occurring too slowly for it to play a major role in the near term. The considerable challenges that remain include high cost for post-combustion capture, lack of policy clarity in China, and attention increasingly diverted to other low-emission options. CCS is technically feasible, but it must quickly make major progress in order to make a real contribution to emission reductions.

All in all, China’s commitments ahead of COP21 look immensely challenging. For China to cap its emissions by 2030, the country will require a slowdown in economic growth to roughly 4.5% annually, a level which would reduce power generation growth. At 4.5% growth, many sectors and domains would be disrupted. Alternatively, it would need even lower carbon intensity such as could be achieved with a dramatic structural change to its fuel mix. The path will not be simple.


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Improving the Case for Gasification

By Harry Morehead
Director, Gasification and IGCC Sales and Marketing, Siemens Energy, Inc.
Juergen Battke
Manager, Business Development, Siemens Fuel Gasification Technology GmbH & Co. KG

Gasification is a technology with a long and checkered history. It was widely used to produce “town gas” for lighting and cooking in the 1800s before it was replaced by electricity and natural gas. Yet its commercial deployment for industrial applications and power generation has been limited, despite several attempts to kick-start the industry.

Historically, interest in coal gasification has tended to peak when access to other fossil fuels was limited or their prices were high. For example, gasification received a great deal of attention in the 1970s during the oil crisis, and at various periods in recent years as a response to high natural gas prices.

Shenhua Ningxia Coal Group’s coal-to-polypropylene project, Ningxia Provence, PRC

Shenhua Ningxia Coal Group’s coal-to-polypropylene project, Ningxia Provence, PRC

A major factor behind gasification’s stuttering commercialization has been the upfront cost. Coal gasification plants typically require capital investments of hundreds of millions of dollars, and in some cases billions. With the effects of the recent global financial crisis still being felt, bringing down the capital cost is essential if coal gasification is ever to truly take off.

Companies such as Siemens have been able to make progress through technology advances as well as a growing number of references, which in itself will reduce costs and build confidence in the feasibility of the technology.

The development of the Siemens gasification process—a pulverized fuel, pressurized, entrained-flow gasification technology—was begun in 1975 by Deutsches Brennstoffinstitut Freiberg/Sa. (DBI, German Fuel Research Institute). The main objective was to create a conversion technology that would allow the use of locally abundant lower-rank coals, including lignite, to partially replace the demand for crude oil and natural gas. Many countries are now taking advantage of their local energy resources and converting those resources into low-carbon electricity, chemical feedstocks, and clean transportation fuels. Heading into China’s 13th Five-Year Plan, the China National Coal Association recommends to “shift from viewing coal as a fuel to considering it a raw material to produce a wide array of products. Based on the initial results of coal conversion demonstration projects in China, such as coal-to-liquids, coal-to-olefins, and coal-to gas, China’s coal industry should accelerate the construction of large-scale, clean, and efficient coal-conversion projects, which could effectively replace some oil and gas.”1

The government of the former German Democratic Republic intended to build several gasification plants around central Germany to supply major chemical companies through long-distance pipelines with syngas produced from coal. Due to the low rank of this lignite and its high salt content, the gasification process developed had to address special requirements for the feeding system and the gasifier itself. The first test facility, built in 1979 with a thermal capacity of 3 MW, was used to examine the technical concept and to test the targeted saliferous lignite for the construction of a large-scale demonstration facility in 1984 at the Gaskombinat Schwarze Pumpe site. Between 1994 and 1998 further test facilities were erected at a Siemens site in Freiberg, among them a 5-MWth cooling screen reactor. Up to now these facilities have been used to gasify more than 90 candidate gasification feedstocks—including different ranks of coal, municipal- or industrial-provenance sewage sludge, petroleum coke, waste oils, bio-oils, bio-slurries, and several liquid residues—in order to investigate their gasification behavior and to analyze the quality and characteristics of the gasification products.

Through this systematic research and development, the range of application of the Siemens Fuel Gasification (SFG®) technology was extended from conventional fuels, such as coals and oils, to also include residual and waste materials and biomass. Over the years since its privatization in 1991, the technology has been owned by several companies. Since its purchase by Siemens in 2006, the Siemens gasification group has been organized under Siemens Fuel Gasification Technology (SFGT) GmbH & Co. KG and has extended its footprint to China, South Korea, and the Americas.


Essentially there are several basic gasifier designs, differentiated by whether they use pure oxygen or air, wet or dry coal feed, the reactor’s flow direction, and the syngas cooling process. Oxygen-blown and entrained-flow gasifiers, such as those designed by Siemens (see Figure 1), are likely to be the most popular going forward.

Figure 1. Siemens SFG® gasification island with dry feeding system; oxygen-blown, entrained-flow gasifier; full water quench

Figure 1. Siemens SFG® gasification island with dry feeding system; oxygen-blown, entrained-flow gasifier; full water quench

Oxygen-blown gasifiers have the advantage of being a compact, cost-effective design and they produce a very clean syngas that can be directly processed after dust removal. These gasifiers operate under high pressure in the range of 40–46 bar, which allows a high syngas output per single gasifier, resulting in fewer trains and subsequently lower CAPEX per ton of final product.

Entrained-flow gasifiers operate at temperatures higher than the ash-melting temperature. Typical operation temperatures are in the 1300–1800°C range. At these high temperatures, the gasifier produces only the components hydrogen, carbon monoxide, and carbon dioxide—no hydrocarbons such as phenols or tar, as is the case for fixed-bed gasifiers. The fuel flexibility ranges from biomass, petroleum coke, oils, tar, and liquid chemical residues to all kinds of coals such as lignite, sub-bituminous and bituminous coal, or even anthracite. For most feedstock, the carbon conversion rate is in the range of 96–99.5%.

Today, gasification processes around the world must limit the production of gas, solid, and liquid wastes. Siemens believes the oxygen-blown, entrained-flow gasifiers represent the environmentally best available technology due to a lack of waste production. There are no gaseous emissions. Solids emissions are in the form of vitrified slag, which is inorganic and nonleaching, and can be sold as construction material. Solids entrained in the gas, process fines, are extracted as filter cake. Liquid-phase waste is becoming an increasingly important issue for gasification plants because water consumption must be reduced; almost certainly, zero liquid discharge systems will be a future requirement in many parts of the world. A quench system can be supplied with a variety of process waters, such as gas condensates from the CO shift or condensate from a methanation unit. The combination of an entrained-flow gasifier and a dry-feed system has the lowest freshwater consumption of all available industrial-scale gasification technologies, typically in the range of 0.35–0.45 ton freshwater/ton coal despite having a full water quench, which is usually fed by recirculating the gas condensate. Eventually, water is discharged from the quench system to limit the salt concentration based on the material and fouling constraints. The typical entrained flow gasifier blow-down rate is lower than other industrial-scope gasification technologies, in the range of 0.1–0.15 ton water/ton coal.

The performance of such entrained-flow gasifiers has already surpassed the older fixed-bed gasifiers, such as those used in the past in South Africa.

Siemens Developments

Prior to 2007-08, the number of Siemens gasification references was very limited and some had been built 30–40 years ago or were no longer in operation. Today, however, there are seven projects operating, in construction or under development with Siemens gasifiers, mostly in China where there are extensive coal reserves. Siemens’ current focus is on “design-to-cost” for the gasification island, taking into account the associated subsystems, in order to simplify the entire process and thus reduce costs.

Generally, larger gasifiers are more efficient and require less pipework and other components. Work has therefore centered on developing a gasifier that offers the optimum size in terms of efficiency and cost.

Much of the SFG development work has been carried out at the Siemens Fuel Gasification Test Center in Freiberg, Germany, which is one of the most comprehensive gasification test facilities in the world (see Figure 2). The centerpiece of the test center is a 5-MWth gasification reactor equipped with Siemens’ innovative cooling screen design. This design allows the reactor to gasify a broad range of coals with ash contents up to 30–35% and high ash-melting temperatures. This reduces start-up and shutdown times at the commercial scale from two to three days (compared to refractory-lined gasifiers) to approximately two hours. The cooling screen has a lifetime of at least 10 years and eliminates the need for the annual or bi-annual shutdowns customary with refractory-lined reactors, resulting in a significantly higher availability.

Figure 2. Siemens Fuel Gasification Test Center, 5-MWth gasifier

Figure 2. Siemens Fuel Gasification Test Center, 5-MWth gasifier

This Siemens-owned test center has been instrumental in developing and testing the SFG-200 and later the larger SFG-500 (2000 t/day coal capacity). Six of these units are now successfully operating at plants around the world.

As part of the continuing effort to reduce costs, Siemens has now developed the SFG-850 gasifier, introduced to the market at the end of March 2014 (see Figure 3). The reactor with this system is sized for larger gasification plants producing chemical feedstocks, synthetic natural gas, or clean transportation fuels, as well as IGCC applications using the most advanced gas turbines.

Figure 3. Siemens’ new SFG-850 gasifier

Figure 3. Siemens’ new SFG-850 gasifier

The SFG-850 is designed to enhance the profitability of future gasification plants by reducing specific plant costs, along with the associated production costs of synthesis gas. An SFG-850 gasifier can convert around 3000 t/day of coal into more than five million standard cubic meters (Nm3) of high-quality synthesis gas.

The SFG-850 gasifier is based on the same technical design as the SFG-200 and SFG-500; however, the proven central burner design and dry coal feed system have now been optimized further in the SFG-850. As with its predecessors, the new gasifier has a high degree of fuel flexibility. All of the proven advantages of Siemens gasifier technology, including its short start-up and shutdown times and the tried-and-tested serviceability of its water-cooled design, contribute to its ability to maintain a high level of availability.

The SFG-850, however, is bigger than its predecessor: Its outer diameter is 0.5 m larger than the SFG-500. Although not a huge increase, this offers a 33% increase in coal throughput capacity. With a length of 22 m, an outer diameter of 4.8 m, and weighing 380 tonnes, the SFG-850 gasifier is one the world’s largest. The new model can be completely fabricated and tested at the factory. Despite its size and weight, the unit can be transported to its installation location in one piece, eliminating the time and expense of field fabrication.

Gasification Has a Bright Future Based on Today’s Hard Work

As noted before, the cost of gasification-based plants is the major challenge for the gasification industry. Companies across the industry are working to reduce the cost of gasification and all of the upstream and downstream processes that will allow gasification plants to operate economically. At Siemens, we believe that the introduction of the SFG-850 makes a significant step forward in reducing the cost of the gasification island. In addition to the economy of scale compared to a standard Siemens SGF-500 reference plant in China, Siemens has achieved further reduction in capital investment cost by optimizing the selection of equipment, valves, and instruments—incorporating lessons learned from today’s operating plants to select better construction materials and developing a more compact gasification island layout.

Beyond the gasification island, Siemens is partnering with industry leaders in coal milling and drying and CO shift catalysts; improvements in these areas will further increase the efficiency of tomorrow’s gasification plants. For example, Clariant, a world leader in specialty chemicals, and Siemens have introduced a new jointly developed sour gas CO shift technology specifically designed for coal gasification. This advanced “low steam” shift technology with Clariant’s ShiftMax® 821 catalyst reduces capital expenditure for the shift unit by up to 20% and optimizes operating costs with up to 30% lower catalyst volume and significantly less steam consumption. This will make gasification plants more economically appealing and, hence, more competitive than what is currently offered.

Ongoing cost reductions will enable greater use of gasification, especially in the industrial sector where countries worldwide are looking to leverage their domestic, low-cost energy resources, such as coal, to produce high-value products including low-carbon power, chemical feedstocks, and clean transportation fuels. The ability to use low-rank coals will make the gasifier particularly attractive to markets such as Indonesia, which currently has no real use for such coal. Gasification would unlock this resource. The same is also true for countries such as Australia, Mongolia, Vietnam, and even Thailand where gasification projects are being considered. There could even be possibilities in the U.S. as natural gas prices rise.

Gasification may also be used as a strategic tool in some countries to reduce dependence on imported fossil fuels. Turkey, which has coal but is heavily dependent on gas imports, is one such country. Ukraine is another prime example; the recent conflict with Russia highlights why gasification might be an attractive option to the purchase of Russian natural gas. As gasification technologies continue to demonstrate better performance, better reliability, and lower costs, more countries will be able to economically justify the use of this innovative clean energy conversion technology to produce the power, chemical feedstocks, and clean transportation fuels they need.



  1. Wang, X. Z. (2014). Advancing China’s coal industry. Cornerstone, 2(1), 15–18.


The authors can be reached at harry.morehead@siemens.com and juergen.battke@siemens.com.


The content in Cornerstone does not necessarily reflect the views of the World Coal Association or its members.

Gasification Can Help Meet the World’s Growing Demand for Cleaner Energy and Products

By Alison Kerester
Executive Diraector
Gasification Technologies Council

Energy is fundamental to economic growth. Economies cannot grow and people cannot raise their standard of living without adequate supplies of affordable energy. The global demand for energy is projected to rise by 56% between 2010 and 2040, with the greatest increase in the developing world.1 This growing energy demand is a direct result of improving individual prosperity, national economies, and infrastructure, and thus living conditions. With this demand in energy also comes a demand for products to support development.

“Increased flexibility, vastly increased scale, and new applications are driving gasification technologies to gain greater prominence  than ever before.”

“Increased flexibility, vastly increased scale, and new applications are driving gasification technologies to gain greater prominence than ever before.”

Gasification, which can provide cleaner energy and products, is not new. Its origin dates back to the late 1700s when an early form of gasification was used in the UK to create “town gas” from local coal reserves. More modern gasification technologies began to evolve prior to and during World War II as Germany needed to create its own transportation fuels after being cut off from oil supplies. Later, Sasol in South Africa made the first strides in transitioning toward large-scale production of commercial, economically competitive gasification-derived products and was instrumental in developing the foundations of the modern gasification industry.

Today’s advanced gasification technologies incorporate significant improvements over those early versions; increased flexibility, vastly increased scale, and new applications are driving gasification technologies to gain greater prominence than ever before. The wide deployment of gasification technologies can be largely attributed to socioeconomic, energy security, and environmental issues. In addition, there is more variation in gasification technologies, with some developers focused on reducing costs through integration while others focus on smaller, modular gasifiers. Greater deployment of gasification still faces challenges, but the recent upswing, especially in China, clearly demonstrates the advantages of this technology for utilizing domestic energy sources to produce commercial products.

Gasification Basics

Gasification is a thermochemical process that converts carbon-based materials—including coal, petroleum coke, refinery residuals, biomass, municipal solid waste, and blends of these feedstocks—into simple molecules, primarily carbon monoxide and hydrogen (i.e., CO + H2) called “synthesis gas” or “syngas”. It’s quite different from combustion, where large amounts of air are blown in so that the material actually burns, forming carbon dioxide (CO2). There are several basic gasifier designs and a wide array of operating conditions. The core of the gasification process is the gasifier, a vessel in which the feedstock(s) reacts with air or oxygen at high temperatures. The CO:H2 ratio depends, in part, on the hydrogen and carbon content of the feedstock and the type of gasifier. This ratio can be adjusted or “shifted” downstream of the gasifier through the use of catalysts.

A key advantage of gasification systems is that they can be designed to have a reduced environmental footprint compared to combustion technologies. For instance, over 95% of the mercury present in the feedstock can be captured using commercial activated carbon beds. Capturing nearly all the feedstock sulfur is necessary because downstream catalysts are generally intolerant of sulfur. This sulfur can be collected in its elemental form or as sulfuric acid, both of which are saleable products. Slag created from the ash, unreacted carbon, and metals in the feedstock are also captured directly from the gasifier, requiring less equipment than what would be required for post-combustion removal of those same materials in the flue gas of combustion-based systems.

Slag captured from the gasification process (photo provided by Westinghouse Plasma Corp., a division of Alter NRG)

Slag captured from the gasification process (photo provided by Westinghouse Plasma Corp., a division of Alter NRG)

CO2 emissions can also be captured from the syngas in gasification plants. Greater than 90% of the carbon in the syngas stream can be captured as CO2 and processed for utilization and/or storage. Some studies have shown that transportation fuels can be produced with near-zero carbon footprints using gasification of coal and biomass with CO2 capture and storage.2

Gasification typically takes place in an above-ground gasification plant; however, the gasification reaction can also take place below ground in coal seams. With underground coal gasification (UCG), the actual gasification process takes place underground, generally below 1200 feet below the surface in coal seams that are considered not economically mineable. Recent advances in well-drilling technologies are now enabling UCG development of coal seams in the 4000–6000-ft depth range, with increased environmental protection and process efficiency benefits at these depths. The underground setting provides both the feedstock source (the coal) as well as pressure comparable to that of an above-ground gasifier. With most UCG facilities, wells are drilled on two opposite sides of an underground coal seam. One well is used to inject air or oxygen (and sometimes steam) and the other is used to collect the syngas that is produced. The ash and other contaminants are left behind. A pair of wells can last as long as 15 years. Under its New Energy Policies scenario, the International Energy Agency has estimated that emerging economies will account for over 90% of the projected increase in global energy demand.3 UCG could play a unique role in helping meet this rising energy demand by utilizing deep coal seams that would otherwise be unobtainable economically.

Additional information on the technical fundamentals behind gasification is provided at the end of this article.

Today’s Gasification Market

Key Benefits

Finding a path to energy security is a chief concern of nearly every sovereign nation. In the past, fast changing markets have rocked economies that were overly dependent on a single fuel source, such as the oil shocks experienced by the U.S. in the 1970s. Today, perhaps the clearest example is the fact that even as European countries pass sanctions against Russia, they are still highly dependent on Russian natural gas. This dependence could be reduced, or even eliminated, through the use of gasification.

Even within borders, diversification of energy sources is crucial. Although the U.S. has access to inexpensive and seemingly abundant natural gas, the extreme cold resulting from the polar vortex in the winter of 2014 saw rapid spikes in natural gas prices. Around the world, oil and natural gas prices continue to fluctuate dramatically. In addition to avoiding price uncertainty, many nations have a strong strategic desire to use their indigenous energy resources to produce the energy and products needed for economic growth. Gasification facilities can be designed to use the carbon-based feedstock that is most appropriate for a given region.

Environmental concerns are also receiving increased attention globally. For reasons explained previously, gasification can offer environmental benefits in terms of reduction of a wide range of emissions. In addition, CO2 emissions can be significantly reduced if carbon capture, utilization, and/or storage are employed. Although environmental concerns may not be the principal driver for the deployment of gasification today, the advantages are undeniable. For instance, gasification can be employed to create low-sulfur transportation fuels, thus reducing one of the major contributors to urban air pollution.

Modern gasification technologies are extremely diverse in their feedstocks, operational configuration, and products. Gasification converts virtually any carbon-containing feedstock into syngas, which can be used to produce electricity and/or other valuable products, such as fertilizers, transportation fuels, substitute natural gas, chemicals, and hydrogen (see Figure 1 for examples of products from gasification). Polygeneration facilities can produce multiple products, one of which can be electricity, from the same initial stream of syngas; the integration of the different components of polygeneration plants can also increase efficiency and provide an overall reduction in the environmental footprint.

Figure 1. Gasification can yield a tremendous variety of products; the examples shown include only the most common (figure courtesy of Eastman Chemical Company).

Figure 1. Gasification can yield a tremendous variety of products; the examples shown include only the most common (figure courtesy of Eastman Chemical Company).

Gasification processes can be designed to operate using coal, petroleum, petroleum coke, natural gas, biomass, wastes, and blends of these feedstocks; this diversity is the fundamental reason that gasification can be used to address energy security concerns. Coal is by far the most common source of the carbon feedstock for gasification today—a fact that is likely to remain true into the foreseeable future as countries look for a way to utilize their vast coal reserves. China has clearly seized on this fact and is now leading the way on building new gasification projects.

Market Drivers

Gasification is not a stagnant technology, nor is it a one-size-fits-all technology. Its use is growing globally and the regional growth is far from uniform. Generally, industrial gasification facilities are becoming larger by increasing the number of gasifiers as well as the gasifier size. The economies of scale, and sharing key equipment such as the air separation unit among multiple gasifiers, are bringing down the cost of the final products. However, these large facilities also come with a billion-dollar-plus price tag, so even though the end products may be competitive, in some instances the upfront costs are prohibitive. In such cases there are other options; project developers can turn to smaller, more nimble gasification facilities that are also able to produce power and products. These smaller projects could bring reliable power to a mini-grid. For instance, SES’ fluidized bed gasifier can be used to gasify a wide range of feedstocks without changing the gasifier design, making it a contender for distributed power generation.

Today’s gasification technologies are able to meet market needs throughout the world. To track projects, the Gasification Technologies Council maintains the Worldwide Gasification Database.4 This database is being updated annually, with the next update due in late 2014. The database lists 747 projects, consisting of 1741 gasifiers (excluding spares). Of the 747 facilities, 234 of them, with 618 gasifiers, are active commercially operating projects. As of August 2013, 61 new facilities with 202 gasifiers were under construction with an additional 98 facilities incorporating 550 gasifiers in the planning phase.5 The cumulative global gasification capacity projected through 2018 is shown in Figure 2.

Figure 2. Cumulative worldwide gasification capacity and projected growth

Figure 2. Cumulative worldwide gasification capacity and projected growth4

Preferred Products

Chemical production is the most common application of gasification worldwide (see Figure 3). Synthetic fuels (both liquid and gaseous) are also becoming increasingly important. The second most common application is liquid fuels, although there is also a large amount of planned production of gaseous fuels. About 25% of the world’s ammonia and over 30% of the world’s methanol is produced through gasification.5


Figure 3. Gasification by application

Figure 3. Gasification by application4

In contrast, gasification for power has declined sharply, with many of the planned projects in the U.S. no longer proceeding.6 The emergence of abundant and cheap natural gas has been a game changer, making coal gasification less economically competitive in North America. In addition, environmental regulations in the U.S. have resulted in few new coal-based gasification projects being planned. Those projects that are proceeding have been reconfigured to capture CO2 and/or to produce multiple product streams—generally, power generation and/or urea for fertilizer production, and CO2 for enhanced oil recovery, such as is the case with the Texas Clean Energy Project. In the U.S. today, a primary interest is in waste gasification, as cities and towns seek to reduce the cost of disposing of municipal solid waste, reduce the environmental impacts of landfilling, and recover the energy contained in the waste. Although North America has generally turned away from new IGCC projects, IGCC projects are moving forward elsewhere; China’s 265-MW GreenGen project and the massive (2.6 GW available for export) Saudi Aramco Jazan refinery project are prominent examples.

Regional markets dictate which products will be most favorable in specific areas. Figure 4 provides an overview of regional market drivers and the products with the most potential to be economically desirable in the near term. Common traits mostly shared throughout India, China, and most of Southeast Asia are high natural gas prices and vast reserves of low-rank coal, which create a strong market for coal-derived substitute natural gas (SNG) facilities.

Figure 4. Gasification market drivers and products by region (figure courtesy of GE)

Figure 4. Gasification market drivers and products by region (figure courtesy of GE)

Although Figure 4 is based on the common belief that in the EU the potential for the expansion of gasification is limited, it actually could play a major role in reducing the reliance on imported natural gas.

Unquestionably, Asia is experiencing the strongest growth in coal and petroleum coke gasification (see Figure 5), with China leading the way. There are now a number of Chinese gasification technology companies that did not exist a decade ago. The high price of natural gas and LNG, coupled with LNG import restrictions in some countries in Asia (primarily China, India, Mongolia, and South Korea), are prompting those countries to utilize their domestic coal and petroleum coke to produce the chemicals, fertilizers, fuels, and power needed for their economies.

Figure 5. Gasification capacity by geographic region

Figure 5. Gasification capacity by geographic region4

Coal Is the Dominant Feedstock

Coal is the primary feedstock for gasification and will continue to be the dominant feedstock for the foreseeable future (see Figure 6). The current growth of coal as a gasification feedstock is largely a result of new Chinese coal-to-chemicals plants.

Figure 6. Gasification capacity based on primary feedstock

Figure 6. Gasification capacity based on primary feedstock4

Although there are many options for the feedstocks for gasification, coal is far and away the choice most often employed, for several reasons. Of course, energy security plays a role considering that coal is distributed globally. In addition, the price fluctuations in natural gas and LNG are another major concern. Figure 7 shows the price, in US$/MMBtu, of several fuel sources, including global oil, natural gas at two sites, and fuel oil, coal, and LNG in Asia over the decade from 2003 to 2013.

Figure 7. Recent prices for gasification fuel options (figure courtesy of GE)

Figure 7. Recent prices for gasification fuel options (figure courtesy of GE)

Fuel price volatility has affected industrial production of chemicals and other products for many decades. In the 1980s, volatile natural gas prices prompted Eastman Chemical Company to switch from natural gas to coal as a feedstock at their Kingsport, Tennessee, chemicals plant. Today, gasification project developers in Asia and elsewhere find themselves facing feedstock choices and fuel pricing options that can dictate project economics. Considering prices in Asia specifically (where most new large-scale gasification is taking place), oil, coal, natural gas, and LNG prices must be compared when considering new projects. In Asia, coal is by far the least expensive option. In addition, the price fluctuations for coal are relatively small compared to those observed in other fuel options.

Increasingly Larger Scale Plants

With a few exceptions, coal and petroleum coke gasification plants are becoming larger in scale to produce enough product(s) to meet market demand as well as to drive down the product price. Although the sizes of the gasifiers are not increasing substantially, the number of gasifiers per project is increasing. The increasing size of projects is resulting in the scale-up of the supporting equipment, such as the air separation units. Large gasification projects currently under construction or operating include:

  • Reliance Jamnagar Refinery (India): The world’s largest refinery and petrochemical complex will be gasifying petroleum coke and coal for the production of power, hydrogen, SNG, and chemicals. The project will have over 12 gasifiers and is currently under construction. The first gasification train is expected to be completed by mid-2015 and the overall project by early 2016.
  • Saudi Aramco Jazen Refinery (Saudi Arabia): This will be the world’s largest gasification-based IGCC power facility to convert vacuum residues to electricity for use both in the refinery and for export. This project is now selecting vendors and is expected to be completed in 2017.
  • Shell’s Pearl Facility (Qatar): The world’s largest natural gas-to-liquids facility using Shell’s gasification technology is now operational.
  • Tees Valley (England): The world’s largest advanced plasma gasifiers are being installed in the Tees Valley to gasify municipal solid waste, construction and demolition debris, and coal to produce power for an estimated 100,000 homes. This project is due to start up in 2016.

Remaining Challenges

Although the momentum behind the application of gasification has increased, a number of challenges remain to increasing deployment. One of the most important is a lack of regulatory certainty in some developing countries. For instance, some gasification projects in India are having trouble gaining a foothold amid concerns about feedstock availability and timely project approvals. Restrictions also are being created by some governments demanding that all technologies be domestically derived, slowing the advancement of deployment in the near term.

The upfront costs associated with large-scale gasification projects remain a hurdle today. Although alternatives to the capital-intensive projects exist, they are unlikely to become a suitable replacement for large gasification projects that offer a lower-cost end product and produce the large quantities of products necessary to meet market demand, such as the chemicals and fertilizer sectors. Bringing down capital costs or finding ways to obtain the required investment will remain a challenge.

Although the capital costs for gasification projects receive more attention, the industry is also working to find ways to reduce operating costs, often through efficiency improvements. For instance, the ability to remove contaminants from hot or warm syngas instead of first cooling the gas (for use with today’s commercially available processes) has the potential to yield significant energy savings. One promising project is RTI International’s warm syngas cleanup project.6 Research is also being undertaken on the development of sulfur-tolerant catalysts, which would allow the sulfur in the syngas to be removed at a later stage in the process, which may be more cost effective.

UCG is a promising technology that today remains relatively undeveloped. There are still technical challenges to UCG that must be overcome, but the major hurdles are actually institutional and a lack of public understanding. Successful demonstration projects could deter misconceptions that UCG is unproven and damages the environment. Linc Energy’s new UCG project in Poland will help demonstrate the viability of UCG to the world.

A great deal of innovative work is underway on new gasification technologies. In addition to UCG, a number of nontraditional approaches to gasification are emerging. For instance, KBR’s new TRIG™ gasification technology, the Free Radical Gasification (FRG™) technology developed by Responsible Energy, and the lower emissions gasification technology developed by ClearStack Power, LLC are all examples of the innovative work currently being conducted that will yield tomorrow’s gasification systems.


The gasification market has evolved significantly over the last five years. Coal gasification, and particularly coal gasification for power generation, has declined significantly in the U.S., although there is a growing interest in waste-to-energy gasification in North America.

Coal-based gasification (and coal gasification for chemicals) is dominant in Asia and will likely continue to be so for the foreseeable future. There is a growing market for petcoke gasification in Asia as well, as Asian refineries strive to remain competitive in the Asian market. High natural gas and LNG prices in Asia, the growing demand for energy and products in the developing world, and the need for energy security will all continue to drive the demand for coal and petroleum coke gasification.

These new plants are moving the deployment of gasification forward in a way that may not have seemed possible just 10 years ago. The tremendous amount of RD&D occurring globally promises that tomorrow’s technologies will be more advanced, less expensive, and more flexible than those in the market today. New experience, technical advancements, and the potential to integrate gasification with CO2 capture, combined with greater needs for energy security, may mean the coming years will fully unlock the potential for gasification that we’ve known has existed for decades.



  1. U.S. Energy Information Administration. (2013, 25 July). International energy outlook 2013: World energy demand and economic outlook, www.eia.gov/forecasts/ieo/world.cfm
  2. Williams, R. (2013). Coal/biomass coprocessing strategy to enable a thriving coal industry in a carbon-constrained world. Cornerstone, 1(1), 51–59.
  3. International Energy Agency. (2013, 12 November). World energy outlook 2013, www.worldenergyoutlook.org/publications/weo-2013/
  4. Gasification Technologies Council. (2014). Database and library, www.gasification.org/page_1.asp?a=103 (accessed July 2014).
  5. Higman Consultancy, GmbH. (2013). State of the gasification industry—The updated Worldwide Gasification Database. Presented at the 2013 International Pittsburgh Coal Conference, 1619 September 2013, Beijing, China.
  6. Research Triangle International. (2014). Warm syngas-cleanup technology, www.rti.org/page.cfm?obj=278DDE67-5056-B100-31A62FC32B088667 (accessed July 2014).


The author can be reached at akerester@gasification.org


Gasification Fundamentals

Gasification is a thermal process that converts any carbon-based material, including coal, petroleum coke, refinery residuals, biomass, and municipal solid waste, into energy without burning it. The carbon-containing feedstock is reacted with either air or oxygen which breaks down the mixture into simple molecules, primarily carbon monoxide and hydrogen (CO+H2), called “synthesis gas” or “syngas”. The undesirable emissions from gasification can be much more easily captured because of the higher pressure and (often) concentration compared to conventional pulverized coal-fired power plants.


Gasifiers capture the energy value from coal, petroleum coke, refinery wastes, biomass, municipal solid waste, waste-water treatment biosolids, and/or blends of these materials. Examples of potential feedstocks that can be gasified and their phases include

  • Solids: All types of coal, petcoke, and biomass, such as wood waste, agricultural waste, household waste, and hazardous waste
  • Liquids: Liquid refinery residuals (including asphalts, bitumen, and oil sands residues) and liquid wastes from chemical plants and refineries
  • Gases: Natural gas or refinery/chemical off-gas

Gasifying Fluid

Gasifiers utilize either oxygen or air during gasification. Most gasifiers that run coal, petroleum coke, or refinery or chemical residuals use almost pure oxygen (95–99% purity). The oxygen is fed into the gasifier simultaneously with the feedstock, ensuring that the chemical reaction is contained in the gasifier vessel. Generally, gasifiers that employ oxygen are not cost effective at the smaller scales that characterize most waste gasification plants.


The core of the gasification process is the gasifier, a vessel where the feedstock(s) reacts with the gasification media at high temperatures. There are several basic gasifier designs, distinguished by the use of wet or dry feed, the use of air or oxygen, the reactor’s flow direction (up-flow, down-flow, or circulating), and the syngas cooling process. There are also gasifiers designed to handle specific types of coal (e.g., high-ash coal) or petcoke.

Prior to gasification, solid feedstock must be ground into small particles, while liquids and gases are fed directly. The amount of air or oxygen that is injected is closely controlled. The temperatures in a gasifier for coal or petcoke typically range from 1400° to 2800°F (760–1538°C). The temperature for municipal solid waste typically ranges from 1100° to 1800°F (593–982°C).

Currently, large-scale gasifiers are capable of processing up to 3000 tons of feedstock per day and converting 70–85% of the carbon in the feedstock to syngas.


Although syngas primarily consists of CO+H2, depending up on the specific gasification technology, smaller quantities of methane, carbon dioxide (CO2), hydrogen sulfide, and water vapor could also be present. The CO:H2 ratio depends, in part, on the hydrogen and carbon content of the feedstock and the type of gasifier. This ratio can be adjusted or “shifted” downstream of the gasifier through the use of catalysts. Ensuring the optimal ratio is necessary for each potential product. For example, refineries that produce transportation fuels require syngas that contains significantly greater H2 content. Conversely, a chemicals production plant uses syngas with roughly equal proportions of CO and H2. This inherent flex-ibility of the gasification process means that it can produce one or more products from the same process.

Some downstream processes require that the trace impurities be removed from the syngas. Trace minerals, particulates, sulfur, mercury, and unconverted carbon can be removed to very low levels using processes common to the chemical and refining industries.



Most solid and liquid feed gasifiers produce a glass-like byproduct called slag, composed primarily of sand, rock, and minerals contained in the gasifier feedstock. This slag is nonhazardous and can be used in roadbed construction, cement manufacturing, and in roofing materials.

Underground Coal Gasification

With underground coal gasification (UCG), the actual gasification process takes place underground, generally below 1200 feet in depth, although recent advances in well-drilling technologies now make UCG possible at much deeper conditions (i.e., 4000–6000-ft depth range).

The UCG reactions are managed by controlling the rate of oxygen or air that is injected into the coal seam through the injection well. The process is halted by stopping this injection. After the coal is converted to syngas in a particular location, the remaining cavity (which will contain the leftover ash or slag from the coal, as well as other rock material) may be flooded with saline water and the wells are capped. However, there is a growing interest in using these cavities to store CO2 that could be captured from the above-ground syngas processing or even nearby combustion facilities. Syngas from UCG can also be treated to remove trace contaminants; once CO2 storage is added, UCG offers another opportunity to achieve a coal-based, low-carbon source of energy and carbon-based products. Once a particular coal seam is exhausted (after up to 15 years), new wells are drilled to initiate the gasification reaction in a different section of the coal seam.

UCG operates at pressures below that of the natural coal seam pressure, thus ensuring that materials are not pushed out into the surrounding formations. This is in contrast to hydraulic fracturing operations in oil and gas production, where pressures significantly above natural formation pressure are used to force injectants into the formation.


As explained, gasification can be used to yield a number of carbon-containing products, including several simultaneous products at polyproduction facilities.

Gasification is a complex process with decades of development behind it. The future of gasification technologies promise to improve on the work that has already been done.

For more information on gasification, visit the Gasification Technologies Council website: www.gasification.org/

The content in Cornerstone does not necessarily reflect the views of the World Coal Association or its members.

Shenhua Group’s Preemptive Risk Control System: An Effective Approach for Coal Mine Safety Management

By Hao Gui
Vice President, Shenhua Group
Senior Vice President, China Shenhua Energy Co., Ltd

The Shenhua Group Corporation, Ltd (Shenhua) is a large, fully integrated coal-based energy enterprise; its principal businesses include mining, electric power, railway, ports, shipping, coal-to-liquids (CTL), and coal-to-chemicals. All these sectors can be high risk when it comes to safety and, therefore, achieving safe operation has been a challenge.

The majority of Shenhua’s operations are mine-based; Shenhua’s 58 underground coal mines, in particular, are vulnerable to mine water issues, fires, methane releases, caving roofs, and coal dust. Prior to 2005, Shenhua’s approach to safety management was based on top-down administration, frequent meetings producing formal safety reports to be followed, and generally centralized regulation. This traditional approach to safety was intermittent, inconsistent, and passive, which was not functional for a company like Shenhua working in continuous, dynamic, and ever-changing safety situations. The traditional approaches to safety could not provide an all-in-one solution that would cover the entire production process; therefore, such approaches were ill adapted to meet Shenhua’s safety needs. Shenhua urgently needed an advanced, effective, and systematic approach to ensure safe coal production and other operations.

The author communicates with miners regarding potential safety hazards.

The author communicates with miners regarding potential safety hazards.

At the same time, the Chinese coal industry as a whole was facing a grim situation in production safety. For this reason, the government and the public had been increasingly attentive to the topic of coal mine safety. Shenhua’s recent safety efforts had resulted in it being considered an industry leader in safe coal production. Therefore, safety inspection authorities turned to Shenhua to lead a nation-wide safety improvement initiative, which included research on coal mine safety management options, innovation of a safety management system and institution for implementation, and setting up effective, useful, and modern safety methods suitable for coal mines in China.

Against this backdrop, Shenhua launched a two-year research project with six domestic research institutions, including several universities, to conduct systematic research on modern safety management concepts, basic theories, preemptive risk control methods, and other essential elements of safety systems. The research team developed a comprehensive preemptive risk control system (PRCS) designed specifically for mining. After years of being practiced by coal companies in China, the PRCS has now been shown to effectively improve coal mine safety and can facilitate the safe and stable development of mining companies throughout China.

Coal Mine Preemptive Risk Control System

The coal mine PRCS was designed according to systematic principles. The system is made up of five distinguishable, but related, parts:

  • Core: Risk identification and management
  • Focus: Limiting unsafe behavior, production system control, and comprehensive factor management
  • Support: Preemptive safeguards

Risk Identification and Management

The PRCS aims at preventing minor accidents and eliminating hidden hazards by creating a bottom-up approach that starts with the elimination of minor incidents instead of passively waiting until accidents have occurred. The core of the overall system is risk identification and management. The process has five major steps (see Figure 1), outlined briefly below.

Figure 1. Risk identification and management process

Figure 1. Risk identification and management process

Identification of hazards: Mobilize all employees to find and register hazards in their workplaces and areas of responsibility one-by-one, so as to identify the various types of risks faced by coal mines.

Risk assessment: Assess and classify the thousands or even tens of thousands of hazards identified for coal mines, so as to determine which risks are major risks, which are moderate risks, and which are minor risks, and then identify the priorities for safety management and control.

Set hazard management standards and measures: Develop hazard management standards according to the law and regulations, and determine to what extent hazards should be managed and what standards must be met in order to prevent accidents. Answer questions about “what to manage” and “how to effectively manage” to avoid accidents.

Hazard monitoring: Monitor whether hazards are under control, test management and control standards for their effectiveness, and take a dynamic approach to identifying potential accidents.

Early warning: If, during monitoring, it is found that a hazard is not effectively controlled, an early warning corresponding to the grade of the hazard should be issued to prompt the rapid implementation of corrective actions and control measures at the site to prevent accidents.

Limiting Unsafe Behavior

According to China’s industry-wide statistics, 90% of accidents in coal mines are caused by unsafe actions. As a result, limiting unsafe behavior was included as a separate component of the PRCS. Starting with ensuring personnel access is restricted to only areas deemed necessary, limiting unsafe behavior is focused on identifying and investigating such behaviors, increasing safety training, and correcting and reducing unsafe behaviors. Seven elements make up the methods and requirements for limiting unsafe behavior in the PRCS.

Production System Control

This aspect of the safety system deals primarily with the control of process-related hazards, such as hazardous materials, tunneling, mechanical and electrical equipment, ventilation, geological surveys, water damage, etc., and other techniques and equipment used in production. The production system controls also specify the requirements for management according to the Coal Mine Safety Regulations, the Coal Mine Safety Quality Standards and Assessment Grading Method, and other applicable laws and regulations. The production system control portion of the PRCS can be divided into 15 subsystems with 112 total elements.

Comprehensive Management

As part of the comprehensive management of the PRCS, there are six subsystems with 23 elements, which closely regulate auxiliary ground operation, emergency rescue, occupational health services, environmental management, contractor oversight, and other aspects outside of the production system controls. Comprehensive management is indispensable to successfully managing coal mine safety.

Preemptive Safeguards

To ensure the effective operation of the overall PRCS and provide participation incentives to staff of all levels, five subsystems and 14 elements were used to create the preemptive safeguard mechanisms. These systems and elements specify the organizational structure for coal mines, the safety investment, regular assessments, rewards, and penalties, as well as the overall culture of safety, fulfilling all the requirements of the PRCS.

Operating the PRCS

In total, Shenhua’s coal mine PRCS contains 28 subsystems and 161 elements, covering nearly every aspect of coal mine safety management. An information-technology-based operational platform system was also developed to improve the efficiency of coal mine safety efforts.

The Important Role of the Coal Mine PRCS

Shenhua hosted training courses and workshops for experience-sharing by users at different levels during implementation of the PRCS. Assessments, rewards, and penalties were established. The assessments are dynamic, and include monthly and quarterly assessments of branches and subsidiaries as well as a yearly assessment for all of Shenhua. At the end of each year, a ranking of coal mines is published and is used to decide where the most rewards and penalties should be instated. A training team of nearly 1000 instructors and an assessment team of 600 auditors have effectively advanced the implementation of the PRCS, which has been put into place in all Shenhua’s coal mines.

Based on years of practice, the key aspects of the system can be summarized as follows.

Promote Participation of All Employees and Assert Safety Responsibilities

Prior to the PRCS, Shenhua had already set up a safety responsibility system, but this system had been only partially implemented due to ambiguous responsibilities and limited operability. The PRCS offers clear-cut assignments of responsibilities and assessment indicators for the mine leadership, various business units, and individual employees. Clear definitions delineate who is in charge, who will do what, and who is responsible for what. With safety elements assigned to the leadership and specific work assigned to employees, the responsibilities are clear to everyone involved. Today, safety inspections are seamless and exhaustive enough to hold specific crews, regional teams, and leaders accountable so that there are no blurry lines around responsibilities.

Provide Solutions for Comprehensive Control of Hazards

The PRCS includes classification of hazards. It allows leadership and business departments to carry out inspections and assessments of key sources of hazards. It also allows crews, regional teams, and on-the-ground workers to carry out inspections and assessments of sources of hazards from their respective positions. First, safety management targets are specified based on hazard inspections. The key aspects of hazards that must be managed are determined based on risk assessments. Then, the measurements to be taken to address the hazards are determined based on the set management criteria, which is set by formal regulations or company rules. Lastly, the methods necessary to meet the safety criteria are approved and finalized by management. By following these steps, the head of each unit can more easily remember all the safety management targets, key aspects of hazards, management measurements, and methods. Through a comprehensive understanding, self-motivation and buy-in of safety management practices have been dramatically improved.

Realize Closed-Loop Management with Continuous Improvements

The PRCS is based on being proactive toward risks. It is operated using the plan-do-check-act (PDCA) method and is constantly improved through repeating the PDCA cycle. By identifying, assessing, and controlling sources of hazards, the system is designed to eliminate the link between hazards and accidents by implementing proactive safety management. Meanwhile, through hazard monitoring, timely hazard identification, and assignment of responsibilities for correction, Shenhua has developed a long-term, closed-loop management mechanism for identifying, correcting, and eliminating hazards to institutionalize and normalize hazard identification and control. The PRCS system itself also is regularly evaluated and improved based on the PDCA cycle of system planning, running the system, system assessments, and system review.

Emphasize the Importance of Safety-Focused Process Controls

Prior to implementation of the PRCS, Shenhua’s safety management was response oriented; namely, a problem was solved only when we found it, which often occurred after an accident. When the PRCS system was implemented, the focus of safety management shifted to process control; Shenhua now inspects potential hazards, carries out risk assessments, projects what safety issues could occur, and controls the process. Through these steps, Shenhua has shifted its focus to forward thinking around safe production and has achieved a proactive stance toward safety management. The PRCS is implemented with the initial design of a coal mine and continues through construction, production, and closure. Of all the 746 factors in the PRCS, 482 items (64.6%) are related to process control. Clearly, Shenhua relies on strict process control to improve mine safety performance.

A worker above inspects for potential hazards. A key aspect of Shenhua’s approach to safe coal production relies on each worker knowing the risks associated with his position.

A worker above inspects for potential hazards. A key aspect of Shenhua’s approach to safe coal production relies on each worker knowing the risks associated with his position.

The System Is Simple and Easily Implemented

Currently in China, there are too many safety-related regulations from different agencies at different levels of government; production companies are unable to fully follow, or even understand, all the regulations. Although each coal mine has thousands or even tens of thousands of potential hazards, for each particular job function only tens or dozens of potential hazards exist, of which the few most serious are prioritized for close monitoring and controlled through hazard inspections. Correspondingly, the PRCS converts state coal mine safety laws and regulations into system requirements and breaks them down by job. For example, each position is assigned a Position Risk Card and an Operation Card, which break down regulations into principles that are easy for each worker to understand, greatly improving the relevancy of job safety management and safety training. If each employee is aware of the potential hazards specific to his job, it is easier for him to closely adhere to safety principles, thus ensuring his own safety. The system is built on each worker having received focused training, clear operational principles, and each person in management also having clear responsibilities.

The System Is Widely Adaptable

The PRCS is a set of safety management principles created specifically for the mining industry. This system was made to be adaptable to coal mines with varied coal types, operating conditions, and scales. For some mines with complex mining conditions, more potential hazards exist and, therefore, the management and control of these hazards is more difficult—but the principles and methods of the overall safety system remain the same. Practice has shown that for such higher-risk coal mines, it is even more important to carefully employ the PRCS.

Shenhua’s PRCS is in line with the safety management guideline of “establishing a hazard identification and management system and a safety prevention and control system”, a concept which was proposed at the Chinese government’s 3rd Plenary Session of the 18th Communist Party of China Central Committee. The PRCS meets two systematic objectives (i.e., hazard identification and management and a safety production and control system), reflects the objective of safe production, and is consistent with safety management approaches of developed countries around the world. In particular, having systematic risk management and an institution for safety system implementation means that the safety responsibilities for each position are clear, so that each person, machine, environment, management, and every other element is safely controlled. In this way, everything affecting safety during coal production is normalized, institutionalized, and systemized. In the end, the hazards are identified, accidents are prevented, and safety is profoundly improved.

Results from the PRCS

Since the implementation of the PRCS in all of its coal mines, Shenhua has achieved excellent safety management performance; since 2007, when the system was first implemented, the fatality rate per million tonnes coal produced has been decreasing (see Figure 2). In 2013, Shenhua was responsible for the production of 500 million tonnes of coal, with only 0.004 fatalities per million tonnes of raw coal, which is far lower than 0.293, China’s 2013 national average. This achievement was a historical low in China and ranks among the best safety records globally. In addition, as utilization of the PRCS spreads, Shenhua’s overall coal mine safety record is constantly improving. For example, Shenhua Wuhai Coal Group Corporation and Shenhua Ningxia Coal Industry Group, which previously were characterized by poor infrastructure and weak safety management practices, have now achieved zero fatalities for three consecutive years of coal production. Finally, the overall safety awareness of employees throughout Shenhua’s coal mining industry has been dramatically improved. The incidence of unsafe actions among employees has been noticeably reduced. For instance, the frequency of unsafe practices in the Shenhua Shendong Coal Group Corporation has been reduced by 30% annually for the past three years.

Figure 2. Shenhua’s fatality rate, 2007–2013

Figure 2. Shenhua’s fatality rate, 2007–2013

In 2009, based on the successful implementation of the PRCS in its coal production business, Shenhua moved to implement the system in its power, railway, ports, CTL, and coal-to-chemicals businesses and formed a comprehensive PRCS that follows the entire energy supply chain.

Shenhua’s project entitled “Coal Mine Safe Production PRCS and Control Technologies” was given the top prize in the 2009 Scientific and Technological Progress Award of China’s Coal Industry. In addition, based on the PRCS, the “Coal Mine Safety PRCS Regulation” has become the industry standard for safety in China’s coal production sector. This regulation has been put into practice across the country under the policy jointly enacted by the State Administration of Work Safety and the State Administration of Coal Mine Safety.

Shenhua’s practice of implementing the PRCS has been closely observed by others in China’s coal industry; safety monitoring agencies in the Chinese government have summarized Shenhua’s safety practices as the “Five Ones”: establish one guideline, set up one system, explore one method, build one team, and nurture one culture. On 19 July 2012, the State Council held the National Coal Mine Safe Production Experience Sharing Meeting in Yinchuan City, where the “five ones” were specified as the core of the PRCS; the Council called for its additional implementation across the country. Today more than 500 coal mines in Henan, Shanxi, Shaanxi, Inner Mongolia, and Xinjiang have adopted the system. Even some large corporations outside coal mine industry, such as Baosteel Group, have drawn upon the experience of the coal industry’s implementation of this system, and commenced research and development regarding their own approaches to risk control systems that take into account the features of their own industries.

Shenhua holds regular safety training workshops to keep stakeholders updated and engaged about safety practices for dynamic working conditions.

Shenhua holds regular safety training workshops to keep stakeholders updated and engaged about safety practices for dynamic working conditions.

After years of practice, Shenhua has demonstrated that the coal mine PRCS is a set of modern management methods adaptable to various conditions. It has also been shown to be a comprehensive, integrated, and evolutionary mechanism for long-term coal mine safety management. We believe this system will continue to lead to positive trends for coal mine safety management in China.


The content in Cornerstone does not necessarily reflect the views of the World Coal Association or its members.

Studying the Dominance of Coal in China’s Energy Mix

By Zhang Kehui
Chief Financial Officer, China Shenhua Energy Co., Ltd

China is facing serious environmental problems. Unlike most developed countries that had experienced such problems in their post-industrial eras, China is still in the process of industrialization. How to maintain a balance between economic development and environmental protection is quite a challenge for the country; the selection of sources of primary energy has a direct impact on the total costs of a society and, therefore, must be comprehensively evaluated based on four key factors: cost-effectiveness, security/safety, environmental impact, and availability. Although the current mainstream discussion around the future of coal may be negative, after careful consideration it can be concluded that coal will continue to maintain its position as the dominant primary energy source for the foreseeable future. However, ensuring that it is produced and utilized as cleanly and responsibly as possible must be driven through economic and regulatory approaches.

Modern coal mines can employ technologies to achieve zero discharge of dust or gangue to the nearby environment; the mine is a closed loop process to mitigate affecting the environment.

Modern coal mines can employ technologies to achieve zero discharge of dust or gangue to the nearby environment; the mine is a closed loop process to mitigate affecting the environment.

Uncertainties Regarding the Dominance of Coal

For more than 60 years, since the foundation of the People’s Republic of China, coal, also given the nickname “food for industries”, has been consistently the dominant source of primary energy in China. In 1952 coal reached its highest percentage of primary energy, 95%. Even during the last decade, this figure has never fallen below 65%. However, with increasingly serious environmental concerns in recent years, a growing number of people have been questioning coal’s dominant role.

Environmental Pressure

In January 2014, China witnessed the highest monthly number of average hazy days since 1961, and continuous and high-intensity haze pollution was reported in 10 provinces nationwide. Many research institutions have cast mining and coal consumption as the main causes for China’s environmental

Although China’s environmental performance on coal mining has improved, there are still some major concerns that must be addressed. For instance, the accumulation of coal gangue, discharge of mine water, and uncontrolled release of coal bed methane.

Regarding coal consumption, according to 2009 national statistics, high coal-consuming industries, such as coal-fired power, coking, steel, and building materials, emitted approximately 7.29 million tonnes of particulate matter, 16.05 million tonnes of SO2, and 3.254 billion tonnes of CO2, each accounting for more than 50% of the nation’s total respective emissions. To cope with the increasingly serious problems of air pollution, in September 2013 China’s State Council issued the “Action Plan for Air Pollution Prevention and Control”. The Plan noted that, by 2017, the concentration of particulate matter in regions like the Beijing-Tianjin-Hebei area, the Yangtze River Delta, and the Pearl River Delta needs to be decreased by about 25%, 20%, and 15%, respectively. The 10 concrete measures outlined in the Plan also require that coal, as a percentage of primary energy, be decreased to less than 65% by 2017.

Additionally, the coal-fired power and the coal conversion industries are characterized by significant water consumption; moreover, most such plants are located in western China where coal is rich, but water resources are scarce. The impact of industrial development on the local water resources cannot be ignored.

Therefore, pressure based on environmental concerns and the adjustment of national energy policies has led many people to believe that the dominant position of coal in China has become vulnerable.

The Rise of Alternative Energy Sources

With the growing global demand for alternative sources of energy, such options are thriving in China and are juxtaposed to the dominance of coal in China’s energy mix.

According to the national energy development plan, by 2020, 30 nuclear power plants will be built with an annual power generation capacity of 40 GW producing 260 billion kWh each year. The cumulative grid-connected wind power capacity is projected to reach 62.66 GW, producing a projected 100.8 billion kWh annually. China’s installed solar power capacity is planned to reach 50 GW annually, producing 150 billion kWh. In addition, shale gas production is projected to increase to 100 billion m3. An earlier goal was set for geothermal power capacity, which is planned to provide 100 MW, and for the production of coal-bed methane, which will reach 30 billion m3.

The development and utilization of these alternative energy sources could directly replace an annual coal production capacity of around 200 million tonnes. Based on these figures, some believe that the dominance of coal in China’s energy mix can be displaced by alternative energy sources.

Market Downturn

Since the start of the 21st century, China has seen a rapid growth of more than 10% in coal sales. However, beginning in 2012, growth in sales has been slowing and the coal market has been weak. The growth rate at the beginning of 2014 was less than 2%, highlighting the issue of oversupply. By 2013, China’s coal production capacity had reached 4.63 billion tonnes plus an extra 300 million tonnes of imported coal, but coal consumption in the same year was only 3.61 billion tonnes. This oversupply has caused a decrease in coal prices. By the end of February 2014, the price of Qinhuangdao 5500K steam coal had fallen to RBM537 (US$86). In addition, the total coal inventory of the seven northern ports had reached 27 million tonnes, a historical high. Industry insiders are deeply concerned and some have become increasingly pessimistic—to the point they have commented about the imminent end of China’s era of coal.

Comprehensive Evaluation of China’s Dominant Energy Source Options

The selection of a principal primary energy source is closely related to the ability to sustain the national economy; therefore, the selection cannot be based on mainstream consensus, but must consider how to best balance economic development and environmental protection. Taking the long-term well-being of the Chinese people into consideration, a system with set scientific and comprehensive evaluation criteria was established so as to make economy-wide comparisons between sources of energy in terms of cost-effectiveness,
security/safety, environmental impact, and availability.

Structure of the Comprehensive Evaluation System

When considering a dominant energy source, it is important not to overgeneralize the criteria, define energy sources via only one characteristic, or even to veto an energy source because of one area of concern. At the very least, I believe the following four factors should be reviewed:

Cost-effectiveness: In this case, the term refers to a ratio between the input costs for the utilization of energy and its output efficiency. China is a developing country and development remains the top priority for social progress; therefore, at this stage, cost-effectiveness should be given priority during the evaluation process.

Security/Safety: This term covers two levels of security/safety. On the macro level, it involves national energy self-sufficiency and the associated geopolitical security; on the micro level, it refers to actual energy production safety—namely, the extent of injury and damage to human life and property during the process of energy production, transportation, and utilization.

Environmental impact: This refers to the extent of environmental impact that could occur during energy production, transportation, and utilization.

Availability: This term is related to the cost-effectiveness factor, but specifically refers to the convenience of energy access (both mining feasibility and transport requirements) and utilization based on technological and economic feasibility.

Coal is shipped from the Shenhua Tianjin port to the various destinations where it is needed.

Coal is shipped from the Shenhua Tianjin port to the various destinations where it is needed.

Using the Factors to Analyze Alternative Energy Sources

The above energy evaluation criteria can be used to analyze and compare other alternative energies, enabling us to make the right choice. With respect to fossil energies, oil and gas could not compete with coal for the dominant position since China has little oil and gas, with reserves accounting for only 2.82% and 3.07%, respectively, of China’s total fossil reserves, compared to 94.11% for coal.

The exploration of shale gas in the U.S. has led to the shale gas revolution in the region, and is helping the U.S. to make rapid progress toward achieving energy independence. According to estimates, China’s shale gas reserves total 30.7 × 1012 m3 (mid-value), which ranks first in the world. However, due to factors such as immature production technology, high production cost (due to geological conditions very different from those in North America), and excessive water consumption, it is still too early to talk about large-scale development of shale gas in China.

By the end of 2013, nuclear power installed capacity nationwide was 14.61 GW and the power generation volume was 112.1 billion kWh, with an average plant availability time of 7893 hr/yr (>90% capacity factor). With respect to the four evaluation factors, nuclear power does well in terms of cost-effectiveness and availability, but due to immature nuclear waste treatment technology, its safety and environmental friendliness are of concern. Recently, the Fukushima accident further heightened concerns around nuclear power, and protests against the construction of nuclear power plants have been occurring globally. Currently, on a percentage basis in China’s energy mix, the contribution of nuclear is less than 1%; there is still great uncertainty about the large-scale development of nuclear power in the future.

When considering solar photovoltaic (PV) energy, there are certainly advantages in respect to the safety and environmental friendliness factors, but given the low energy density, large footprint, and geographical restrictions associated with solar energy, its underperformance in the cost-effectiveness aspect has been causing concern for China’s government, similar to issues faced in some developed countries. For example, in 2012 the Parliament of Germany reduced direct subsidy to the PV power industry by 29% from the original €0.50/kWh as a result of the excessive financial burden. For a developing country like China, taking the current power generation cost into consideration, large-scale development of the PV power industry would inevitably result in huge financial subsidies that would be difficult for the government, and the growing economy, to justify.

Wind power is another option as a primary energy source. The safety and eco-friendliness aspects of China’s wind energy are generally positive, but because the grid technology for wind power generation is not yet mature and the power produced is unreliable, it results in high operating costs. Even so, China is the world’s number one wind power producer; as of the end of 2013, the installed wind power capacity was 91.4 GW, accounting for 6% of the total national installed capacity. However, the average time of availability was only 2080 hr/yr, much less than the 5012 hr/yr average for coal-fired power plants. Wind power generation in 2013 was 140 billion kWh, providing only 2.7% of total national power generation. The large-scale deployment of wind farms to replace coal-fired power generation is uncertain and remains subject to breakthroughs in energy storage and smart grid technology.

Hydropower is an important source of clean energy. China’s hydropower installed generation capacity in 2013 was 280 million kW and the planned generation capacity by 2020 will be at least 420 million kW—84% of China’s total economically exploitable hydropower (estimated at 500 million kW). There is some concern regarding the local environmental impact of the large-scale construction of hydropower stations, which should not be ignored. Therefore, mainly from the perspective of development potential, hydropower also cannot replace the dominant role of coal-fired power generation.

To sum up the evaluation of all energy sources, although nuclear energy, solar energy, wind energy, hydropower, and shale gas could be developed to replace coal energy to a certain extent, coal will still maintain the dominant position in China’s energy mix into the long-term future.

Coal-Related Intrinsic Advantages and Technological Development

Among China’s proven fossil energy reserves, coal makes up the overwhelming majority (94%); this vast reserve is the third largest in the world. Over the past 14 years, RMB3.1818 trillion (US$511 billion) has been invested in the mining, beneficiation, production, and supply chain of coal, which accounts for 20% of the total investment in China’s energy sector. The mining technologies used by China’s largest coal enterprises are competitive with the best in the world. All these factors offer an enormous advantage for coal when considering factors such as cost-effectiveness and availability.

In terms of security/safety, China’s abundant coal reserves provide a reliable basis for energy security. In 2013, 58% of oil in China was imported, but due to the large amount of coal resources, 90% of China’s energy is domestically sourced. When considering the safety of production, coal production in China still has significant risks, but these risks are being reduced through the expansion of modern mining practices. For instance, the fatality rate per million tonnes of coal in China’s coal industry has dropped by nearly 90% in only a few years, from 2.81 in 2005 to 0.293 in 2013. China’s largest coal producers have already achieved safety standards comparable with those of the mining industry in developed countries such as the U.S. With further development and deployment of science and technology, safety in mining can be further improved.

In China, big coal-related energy enterprises, such as Shenhua Group, are also committed to decreasing the environmental impact of coal production and utilization. For coal mining, technologies involving environmental mining practices, water conservation, and integrated utilization of resources have been developed. In some mining areas, the vegetation coverage during mining has been increased by nearly 50% and zero discharge of mine water has been accomplished; in some cases water is processed and used to fulfill over 95% of the local need. For coal utilization, several high-efficiency, low-emissions, coal-based electricity generation technologies, including GW-sized ultra-supercritical (USC) technology, have been mastered. Similarly, technologies for SOx, NOx, and particulate matter emissions have been developed to the same level as developed countries, but have not yet been fully deployed. For coal conversion, several chemical technologies, such as direct coal liquefaction, indirect coal liquefaction, and coal-to-olefins, has been developed. By 2020, the planned capacity of coal-to-liquids (CTL) is 30 million t/yr; coal-based to synthetic natural gas production is planned to be 50 billion m3/yr.

The environmental impact of coal utilization remains the major concern, both domestically and abroad, associated with coal as an energy source. It is not only a problem constraining the further utilization and development of coal resources, it is generally a major issue that China must face on as it continues its path of development.

In China, the selection of coal as a dominant energy source is not only a reflection of its energy mix, but also its current stage of development. As environmental problems are often byproducts of industrial development, it is necessary to reduce such impacts by means of policy, law, science, and technology so as to achieve greater societal benefits with relatively low associated costs.

Ways to Reduce China’s Coal- Related Environmental Impact

To some extent, the coal-related environmental impact occurring in China is inevitable and the root cause can be attributed to the extensive growth model of the coal industry which has limited the attention paid to environmental protection. Correspondingly, effective ways to address these ecological problems should invoke law, policy, and technology.

Improve Legal Regulation

Among China’s existing laws and regulations governing coal production and utilization, those that focus on the environmental impact are fragmented and sometimes even absent. Therefore, I believe China should learn from the experiences of developed countries and accordingly make clear the functions and duties of the legislature and government. The old notion and practice of “policy playing the role of law” (i.e., when policy is taken as the law and no set laws exist) must be abandoned.

The legal system for clean coal utilization should be reviewed at the national legislative level with top-down implementation. Under such a framework, the central government should fulfill its duty of administrative legislation and policy-making, while the local people’s congresses and governments should play a supplementary role within their respective legal authorities (i.e., local decrees and special decrees).

I believe all of the laws and regulations should make operability an important consideration. Clauses focused on penalties for noncompliance should be spelled out in detail so as to avoid misinterpretation. Similarly, while intensifying the penalties,
protection should be extended to those implementing technological and economic responsibility around clean coal production and utilization. I believe that not only the principal responsibilities of coal producing and consuming enterprises, but also the supervisory responsibilities of the various levels of government should be clearly defined so as to ensure that all the entities can carry out responsible production and utilization of coal within the legal framework.

Finally, the supervisory and management functions of various levels of government during law enforcement should be clearly defined. While the watchdog role of different levels of government is encouraged, it must not be expanded beyond certain limitations—specifically, government entities should not intervene in the markets. Instead legal means should be adopted to guide enterprises to make responsible choices.

Strengthen Policy Guiding Clean Coal Production and Utilization

Enforcing environmentally friendly production and utilization of coal will undoubtedly increase the costs associated with such activities. Therefore, it is important that governments’ policy is perfected so it can serve as a guide.

The first measure to improve policy is to change the way performance appraisals for businesses are completed. Indexes reflecting the scale of economic growth should be reduced, while the focus on coal-related environmental impact should be increased. In addition, the environmental performance appraisal structure should be improved by taking environmentally related investment as an adjustment factor for the economic value added (EVA); this would guide enterprises to change how their businesses are run to more carefully consider the goal of environmental protection.

Another approach to better regulating/legislating coal producers and consumers to reduce environmental impact is to promote the development of an economy based on recycling, low-carbon, and environmentally friendly businesses through the creation of financial incentives and taxation policies. I propose that the central government implement additional pre-tax deductions focused on environmental investment by the coal enterprises under the premise that coal consumers have reached certain standards for energy savings and also emissions reductions. For coal-producing enterprises, the tax incentives associated with land reclamation should be further strengthened; pricing mechanisms should also be used to promote water recycling. For coal-consuming enterprises, a compensation mechanism for saving energy and reducing emissions should be created. Since coal-fired power plants are the main consumers of coal in China, accounting for around 60% of total coal consumption, such incentives should be given to enterprises that adopt large, clean, and efficient power units. The incentives could include dispatch priority, price subsidies, tax abatement, etc., which would encourage coal-fired power plants to make progress toward the goal of near-zero emissions.

Last, but not least, based on the current number of environmentally related debts that should be compensated for in China, it is also important to exert certain taxation incentives encouraging enterprises to set up special environmental funds for coal production and utilization.

With the addition of de-SOx and de-NOx environmental technologies, emissions from coal-fired power plants can be dramatically reduced.

With the addition of de-SOx and de-NOx environmental technologies, emissions from coal-fired power plants can be dramatically reduced.

Promote New Clean Coal Technologies

Production and utilization are at the two ends of the coal resource chain; with the application of clean technologies, the eco-friendliness factor could be improved at both ends, which would be conducive to fostering a cleaner, recycling-based, low-carbon modern industrial system.

To promote environmentally friendly mining technologies by strengthening the life-cycle management of coal production, the following areas should be given priority:

  • Improve coal-bed methane detection capabilities so as to facilitate its collection and utilization.
  • Increase research on the usage options for coal gangue, especially in the power sector (e.g., mixture of coal gangue and slime and the use of coal gangue in construction).
  • Promote mine water purification technologies so as to increase the utilization of mine water.
  • Promote the use of low-carbon gangue in mine reclamation and land filling so as to reduce ground subsidence and surface damage.
  • Plan comprehensively for coal transportation and power transmission adhering to the idea of “placing equivalent priority on both forms of energy transfer” so as to optimize the delivery and distribution system and reduce the environmental impact of coal transportation.
  • Exert greater effort on the extraction and utilization of coal byproducts so as to reduce the discharge of waste and improve the comprehensive utilization of coal resources as well as increase the value of coal.

Promoting cleaner power generation technologies will require strengthening the management of coal-fired power plants. Revamping equipment and technology and upgrading efforts in power enterprises should be reinforced. For instance, encouraging the adoption of high-efficiency, low-emissions, large units and also promoting closed-loop operation, auto-controlled, high-efficiency combustion, and low excess air technologies would increase the efficiency of utilization of the coal feedstock. Similarly, new technologies should be studied and promoted, such as high-efficiency and boiler gas removal technology, upgrading removal systems for SOx, NOx, mercury, and particulate matter as well as coal residue extraction and utilization technologies.

The methodical development of China’s coal conversion industry can be founded on new technologies. For this newly emerged industry, overall planning for the proper nationwide design with the integration of different coal-to-chemicals technology routes is necessary. At the same time, new technologies such as coal-based polygeneration and integrated gasification combined cycle (IGCC) power generation, as well as the combination of chemical production with wind power, should be developed and promoted so as to improve comprehensive energy efficiency. Specifically in the coal conversion industry, not only can high-carbon coal can be converted to relatively low-carbon liquid fuels or chemical products, but also the high-concentration CO2 generated during the process could be captured and stored (CCS) so as to truly accomplish the clean and low-carbon conversion of coal.


China’s dependence on coal will continue into the foreseeable future. In fact, today there are no other viable energy sources that could replace coal’s principal role as a primary energy source. For this reason, it is worthwhile to take carefully implemented steps to improve the efficiency and environmental impact of coal production and utilization.


The content in Cornerstone does not necessarily reflect the views of the World Coal Association or its members.

Shenhua’s DCL Project: Technical Innovation and Latest Developments

By Shu Geping
Chief Engineer, China Shenhua Coal to Liquid and Chemical Co., Ltd.

Direct coal liquefaction (DCL) is the most effective approach for the production of liquid products from coal; the energy conversion efficiency can be 60% or greater. DCL also offers important strategic and practical benefits to China in regards to solving problems such as shortages of petroleum resources, balancing the energy mix to rely more heavily on strategically secure coal reserves, as well as a sustained, steady growth of the national economy.

The Shenhua DCL project is a commercial-scale demonstration project that is the first in the world to adopt modern DCL technology; the project is based on creativity and exploration and is demonstrating the promise of the technology to the rest of the world.

Shenhua DCL project

The Shenhua DCL project is the largest DCL project in the world.

Technical Innovation in the Shenhua DCL Project

Development of the Core Process and Initial Scale-Up

Advancement of the Shenhua DCL Process

The Shenhua DCL process, see Figure 1 for a process schematic, is the most critical technology within the entire project. The capacity of the project is 30 times larger than any other DCL units operating now or in the past. Compared with existing processes both in China and abroad, the Shenhua DCL process is clearly more advanced based on the following features:

  1. Largest capacity of any single production line: The liquefied coal processing capacity of the single-production line in the Shenhua DCL process is 6000 tonnes/day of dry coal, whereas the capacity of the largest production line abroad is only 2500–3000 tonnes/day of dry coal.
  2. Superior synfuels yield: The high-performance solid catalyst used in the Shenhua DCL process means that less catalyst is required and the yield of distilled synfuels is greater than that of the DCL processes abroad that operate under the same conditions.
  3. Improved stability: The overall stability of the Shenhua DCL process is greatly superior to that of DCL processes abroad.
  4. The Shenhua DCL process is a proven process: the first in the world to have undergone verification at the bench scale, pilot scale, and demonstration at the megaton industrial scale. Thus China has become the sole nation with a megaton-scale proven DCL technology.
Shenhua's DCL Project Figure 1

Figure 1. The Shenhua DCL process, shown in the schematic above, is the most critical technology within the entire project.

Preparation of the DCL High-Performance Catalyst

The DCL high-performance catalyst is one of the critical technologies responsible for increasing the coal conversion rate and product yield as well decreasing the severity of DCL process operating conditions (i.e., temperature and pressure can be significantly lower when the catalyst is employed).

The Shenhua Group and the China Coal Research Institute, financially supported by the 863 Program of the Ministry of Science and Technology, jointly developed the DCL high-performance catalyst. During laboratory-scale research, the process and key operating parameters were defined, solutions were developed to avoid unintended reactions, and control parameters were developed for the precipitation and oxidation process. A continuous test unit with a production capability of three tonnes per day of catalyst was constructed. Subsequently, a unit for continuous preparation of the 863 catalyst (named after the program under which it was developed) to provide catalyst for the pilot-scale DCL demonstration was constructed in the Shenhua pilot-scale R&D center. For the DCL demonstration project the catalyst production process was proven after it was scaled up by a factor of 1000 times.

DCL Synfuels Processing

Because the properties of DCL-derived synthetic fuels greatly vary from those of conventional petroleum, upgrading of DCL-derived synthetic fuels requires stricter processing conditions compared with conventional crude oil refining. In addition, catalysts and processing techniques must be specifically developed based on the properties of the DCL-derived products and processing techniques. Catalysts developed in China were adopted in Shenhua’s DCL project; a new combined process of product refining and product modification was also developed. Thus, liquefied petroleum gas (LPG) has been processed into high-quality diesel and naphtha. The market for these products is favorable, with highly saleable products and byproducts (e.g., diesel, naphtha, and liquefied natural gas).

Overcoming Hurdles in the DCL Process

Reactor Resistance to Mineral Sedimentation

Globally, mineral accumulation is common in DCL reactors, which is especially prone to occur when high-calcium content coal is used, as is the case for the Shenhua DCL project. To solve the problem of sedimentation, Shenhua first investigated how to solve the problem at the bench and pilot scales. The reactor type and dimensions of the internal components were determined at the bench scale and then at the pilot scale using a 1-m diameter cold-flow model. Sedimentation of the minerals in the reactor is avoided by controlling the superficial liquid velocity, stabilizing unidirectional flow, and forcing full backmixing. As the largest high-temperature, high-pressure hydrogenation reactor in the world, the reactor applied in the commercial-scale demonstration project has an internal diameter of 4.8 m and has given no indications of mineral sedimentation—even after nearly three years of operation.

High-Temperature and High-Differential Pressure Relief Valves

Increasing the resistance to wearing of high-temperature, high-differential pressure relief valves applied in DCL processes is a global problem. In the U.S., six types of relief valves were tested on a 200-t/d unit using the H-Coal DCL technology; the longest service life for the valves was 600 hours. In Japan, synthetic diamonds have been used as valve seats in a two-section throttling valve, and the longest demonstrated service life for such valves was 1008 hours on a 150-t/d DCL unit. There is a clear requirement for extremely strong materials in the DCL process; although it is strong, the flow coefficient of the valve using synthetic diamonds is far below the requirements in the industrial-scale DCL process. Other valves may have a suitable flow coefficient, but are not strong enough for long-term industrial-scale operation

Collaborating with domestic manufacturers, Shenhua Group developed a high-temperature, high-differential pressure relief valve for DCL based on the four following aspects:

  1. Research and develop appropriate pressure-relief valve structures based on hydrodynamics.
  2. Change operating parameters to reduce the solid content in the medium.
  3. Optimize control methods and increase the service life of the pressure relief valves.
  4. Develop superhard materials suitable for long-term, large-scale operation.

The longest service life of the pressure relief valve developed using Shenhua’s valve technology is 2500 hours, with more than 3000 hours of operation considered feasible based on the valve condition after disassembly.


Coking is a problem in most DCL projects. Specifically, in one project outside of China, coking has occurred in the reactors, the coal slurry reheating furnaces (especially the pressure-relief tower reheating furnace), and the high-temperature, high-pressure separator in the 100-t/d DCL unit. The coking severely affects operation. Preventing coking in the three major vessels is a global challenge. However, coking is not a problem in the Shenhua DCL project. The main factors that lead to coking were discovered through repeated tests and analysis; the impact on operation has been removed through improvement of design and operating conditions.

DCL products

The two samples on the right are the end products of the DCL process.

Increasing Equipment Capacity

Shenhua’s DCL project has incorporated numerous innovations related to the core process technology, and independent R&D is also being carried out on equipment, such as the reactors, and has led to the recognition of the equipment in the project as the most advanced globally. One example is the development of a DCL reactor with the largest capacity of any single-production line in the world. Other examples include a centrifugal pump and other core equipment that are resistant to wearing caused by solids and also can be used at high temperatures, both of which translate into sound economic benefits

Key Environmental Technologies for DCL Emission Reduction

Treatment and Conservation of Water

The typical wastewater from the Shenhua DCL project is high-concentration wastewater; its converted chemical oxygen demand (COD is a common term to determine the degree of pollution) concentration can reach 10,000 mg/L. Therefore, a wastewater processing technology was developed, starting with repeated laboratory tests. Following the laboratory tests, a full wastewater treatment process was developed; the investment in the water treatment facilities for the Shenhua DCL project to date is 890 million RMB, accounting for 7.02% of the total project investment, with the goal of near-zero wastewater discharge.

After the trial operation of the high-concentration wastewater treatment system was completed at the end of December 2008, some unanticipated problems were encountered. Shenhua Group has been vigorously pursuing solutions and improvement measures to solve the problems revealed during unit operation. After more than two years of experimental study, a comprehensive wastewater treatment technology was developed and adopted; the treatment process includes efficient catalysis oxidization, high-efficiency biological filters, ozonation, coagulation of sedimentation, membrane reactor (MBR), ultrafiltration (UF), and reverse osmosis (RO). The retrofit project to incorporate the high-concentration wastewater treatment technology has been initiated. With an investment of 450 million RMB, this wastewater treatment retrofit project has an estimated completion date of October 2013. After completion, high-concentration wastewater can be used as inlet water for a desalination processing facility, so as to change the project’s philosophy regarding the treatment of wastewater from recycling according to quality to multiuse, and thus truly realize a standard of near-zero wastewater discharge. After the advanced wastewater treatment enters into operation in late 2013, the recycling rate of wastewater will also be further improved. Water consumption as well as the quantity of intake water from the water source can be further reduced, and the ratio of tonnes of water consumed per tonne of synthetic fuels produced can be decreased to less than six.

Emissions Reduction through CCS

Large amounts of CO2 are released during the process of converting coal into synthetic fuels. The goal of carbon emissions reduction can be realized only through the treatment of the CO2. Along these lines, Shenhua Group has constructed the first carbon capture and storage test unit in Asia, through which CO2 released from the DCL hydrogen production facility is captured and then geologically sequestered through injection into a saline reservoir more than 2000 m underground. Through the first half of 2013, the cumulative quantity of CO2 injected over the life of the project was 125,352 tonnes, with each measured operating parameter superior to the design parameters. Monitoring data has been collected from one injection well and two monitoring wells and the injection demonstration has achieved the phased objectives.

Water treatment process

With a goal of near-zero wastewater discharge, a comprehensive water treatment process was developed for Shenhua’s DCL project. Steps within the comprehensive treatment process include (in clockwise order) biological filtering, settling tanks for coagulation, ultrafiltration membranes, and reverse osmosis.

Recent Progress

Since coal feeding began on 30 December 2008, the Shenhua DCL demonstration project has achieved safe, reliable, long-term operation at full production capacity through a series of technical innovations and breakthroughs as well as equipment breakthroughs and process optimization. Today, the project is making strides toward the target of operation optimization.

In 2012, the DCL unit operated for a total of 7248 hours, with synfuels output of 865,500 tonnes, and a profit and tax of 1.867 billion RMB. By the end of May 2013, the synthetic fuels output was over 400,000 tonnes. The cumulative operation time of the project had reached 302 days (the initial objective was 310 days), with a single continuous operation time of 252 days. The highest load is rate was 105% of the design value. The highest product yield was 57%, and the coal conversion rate was 91%.

Fueling stations

Shenhua has built fueling stations to sell clean diesel products.

The Shenhua DCL project can ultimately result in valuable economic and social benefits. The project has completely operated under market-based restrictions—raw coal is purchased at the base market rate and products are subject to market-priced sales. The price for diesel is determined according to the price guide issued by the National Development and Reform Commission, and the transfer price of petroleum and petrochemical products is approximately 500 RMB/tonne less than the market retail price. As of 30 May 2013, the DCL project has operated for a total of 22,920 hours, with a synfuels output of 2,580,000 tonnes, sold 2,530,000 tonnes of synfuels products, and paid 2.982 billion RMB in fees and taxes, with an average of 1178 RMB/tonne synfuels paid. The tax payment per tonne of synfuels of the Shenhua DCL project is much higher than that of the average coal-to-chemicals industry or petrochemical companies, thereby making a greater contribution to China’s economic growth.

Projections of the economic benefits have been made based on full-load operation and actual production and consumption indices according to product prices based on an international oil price of US$80, and the actual price level of raw materials. This analysis has shown that Shenhua’s DCL process can be economically advantageous. The plant will have an even greater profit potential through continued innovation and optimization, which could reduce raw material consumption and improve product yield.


  1. The Shenhua DCL project is the first industrial-scale demonstration project in the world based on modern DCL technology. The successful completion and operation of the project has significantly advanced the development of coal liquefaction. Validating operation through the demonstration project has made the technology more mature and has enabled China to lead the world in the application of clean coal conversion and utilization.
  2. After safe, stable, optimal, and long-term operation at full capacity, the project has successfully achieved the expected goals with favorable economic returns. Its environment-friendly operation, especially the near-zero discharge of wastewater, has played an important role in the industrial-scale demonstration project.
  3. The successful operation and completion of the project can promote the rational utilization of coal resources in western China as well as optimizing the structure for coal utilization industry. The project has importance and significance in promoting local coal processing (i.e., converting coal to synfuels near the mining site) and clean coal conversion, and in improving the value of products of coal conversion.
  4. During the implementation of the project, domestic equipment and materials have been adopted that will promote the improvement of equipment manufacturing for the modern coal-to-liquids and coal-to-chemicals industry in China, as well as the advancement of design, integration, and construction capabilities in related fields.


The content in Cornerstone does not necessarily reflect the views of the World Coal Association or its members.

The Rio Summit: Waking Up to the Three Pillars of Global Poverty, Energy Access, and Coal

By Benjamin Sporton
Deputy Chief Executive, World Coal Association

Halving global poverty was the centerpiece of the Millennium Development Goals adopted by the United Nations in 2000. An ambitious goal, it was adopted among a range of other development goals to fight the extreme poverty and hunger experienced across the developing world. Early in 2012, as the world began to prepare for the Rio+20 United Nations Conference on Sustainable Development, the World Bank and United Nations announced that, in fact, this goal had been met. “The developing world as a whole has reached the first of the millennium goals,” said Martin Ravallion, a senior World Bank official.

Sha Zukang, Secretary General of the Rio+20

Sha Zukang, Secretary-General of the Rio+20, listens as Ecuador’s President Rafael Correa addresses the UN Conference on Sustainable Development, or Rio+20, in Rio de Janeiro, Brazil, 21 June 2012. (AP Photo/Victor R. Caivano)

“As a whole” was an interesting choice of words. The true story is a little different. In the past 30 years, in fact, the number of people living in extreme poverty in the developing world has remained stagnant, at around 1.1 billion, most of these in Africa and Latin America. The real story about lifting people out of poverty has come in East Asia, and particularly in China. In that same 30 years, China’s economic boom has seen 662 million people lifted out of poverty, a huge achievement by any measure.

Electrifying China

China’s poverty alleviation effort has been built upon massive improvements in basic infrastructure and the creation of local enterprises, enabling a productive workforce that continues to drive wealth creation and poverty eradication across the country. None of this could have been achieved without an immense electrification program that has brought electricity to 99% of China’s population, adding around 1500 terawatt hours of production capacity in the last 20 years.

How has that massive expansion in electricity and infra- structure been achieved? It is by now a well-known answer: China has used its significant coal reserves to fuel its expanded energy supply and to make the steel to build its growing cities and industries. No other development strategy has proved more successful in lifting people out of poverty. However, this is a lesson often overlooked.

Balancing the Three Pillars

Last year’s Rio+20 conference was billed as the 20th anniversary of the Rio Earth Summit in 1992; taking another view, however, it was actually the 40th anniversary of the original Stockholm Summit on Environment and Development held in 1972. More than 40 years and countless international conferences since this original summit, world leaders still struggle to define a pathway to the eradication of global poverty.

One challenge in defining that pathway has been the difficulty in finding balance between the three pillars of sustainable development—economic, environmental, and social sustainability. With growing concern about environmental degradation and the impacts of climate change, the developed world has focused heavily on environmental aspects of development, whereas the challenge of poverty eradication means much more focus is placed on economic aspects of sustainability in the developing world. It’s a tension that has prevented progress in attempting to negotiate both environmental and development treaties for decades.

No clearer has this dichotomy presented itself than in debates about access to energy. Four billion people struggle with energy poverty, including 1.3 billion with no access to electricity at all and many more that rely on wood and dung for cooking and heating. It is well known, as the story of China shows, that access to energy is a critical element for lifting people out of poverty. It’s for this reason that 2012 was declared by the United Nations as the International Year of Sustainable Energy for All, and that energy access was a major topic of discussion in preparations for last year’s Rio summit.

It is regrettable, though, that international talks about energy access have been caught in that historical wrangle between environmental and economic progress. Debates on energy leading into the Rio summit saw a huge focus from the UN agencies and the developed world on renewable energy sources being the primary tool with which to tackle energy poverty. It is true that renewable energy will have a big role to play in achieving energy for all, but many in the developed world have focused exclusively on these sources due to their overriding environmental priorities. The victim of this focus was a truly ambitious outcome from the Rio conference on energy access.

Targeting Energy Access

Many commentators have lamented that the Rio conference failed to agree on, or even support, a specific target for delivering energy to those who lack access to it. This is disappointing. The risk, however, was that such a target might lack any true ambition. The early draft of the Rio outcome document referred to a “basic minimum level” of energy access, but what does this mean? According to the definition proposed by the International Energy Agency (IEA), it is defined as “use of a floor fan, a mobile phone, and two compact fluorescent light bulbs for about five hours a day” in rural areas and in urban areas perhaps also “an efficient refrigerator, a second mobile phone per household, and another appliance”.1  That is not the sort of energy access target that the developing world needs, and it is certainly not the type of energy access that has supported the huge growth in China’s economy in recent decades. That is because targets like this one specifically exclude consideration of energy supplies for business, industry, and social infrastructure.

A recent study demonstrated the scale of the challenge when it comes to providing comprehensive energy access. Looking at sub-Saharan Africa (excluding South Africa), the study highlighted the need for a twelve-fold increase in electrical generation capacity in the region, from the current 31 GW of installed capacity to about 374 GW, to meet even a moderate access scenario (see Figure 1).2 Such a scenario would be a truly positive transformation for the region—economically, socially, and, importantly, environmentally. That is despite such a scenario continuing to leave the population of sub-Saharan Africa well short of the sort of electricity supply demanded by those of us in the western world.

Rio Summit Figure 1

Figure 1. Scenarios and projections for installed power capacity in Sub-Saharan Africa2

The real challenge for policy makers across the globe is how to meet this demand for energy. The IEA has assessed the energy sources needed to meet their own minimal “energy for all” scenario.3 Their assessment shows that roughly 840 terawatt hours of generating capacity is needed, just over half of which would be provided in mini- and off-grid solutions. All but a small proportion of the off-grid component is expected to come from renewable energy. This is what some have described as the “cook stove and light bulb” solution to energy access, where wind and solar are deployed to provide basic access to energy. Yes, this approach can provide cleaner cooking solutions in the home and reduced household pollution from burning wood, dung, and charcoal in the home—leading to improved outcomes; it also provides lighting to improve household productivity and educational outcomes. It is an important, short-term first step in addressing energy poverty. But it cannot be the maximum of global ambition on achieving energy access.

The On-Grid Solution

It is the makeup of the on-grid part of the IEA’s energy-for-all scenario that points toward what a more ambitious energy access target might look like (see Figure 2). Coal is the key component of the on-grid solution in the IEA’s energy access target. According to their report, more than half of the on-grid electricity needed to meet their minimal energy-for-all scenario will come from coal, and that is telling. Grid-based electricity is essential to provide reliable supplies of electricity that avoid the intermittency of off-grid renewables. Without grid-based electricity, households, industry, and business cannot rely on electricity, and this places economic security at considerable risk.

Rio Summit Figure 2

Figure 2. Additional On-Grid Generation Necessary for Energy Access for All3

Why is coal so critical to this solution? There is a stark reality when it comes to looking at where the real energy access challenge exists, and the resources that exist in those regions (see Figure 3). Africa, India, and developing Asia are where almost all of the world’s energy poor can be found. Each of these regions also has huge coal reserves available to meet the energy access challenge. One of the major outcomes from the Rio conference was recognition that countries are entitled to choose their own energy mix based on national policies and priorities and their financial and, critically, natural resources. This recognition needs to be sustained into the future to enable countries to truly address their energy needs in an affordable way.

Rio Summit Figure 3

FIGURE 3. Number of People without Modern Energy Access3

Setting Sustainable Development Goals

The next steps from the Rio conference will see preparation of a new set of Sustainable Development Goals to come into effect beginning in 2015. These goals will be successors to the Millennium Development Goals, which lack any reference to energy access targets. There will need to be a concerted effort to ensure that these new goals recognize the different pathways countries can and will choose to achieve their energy futures based on their own resources. This will be a major debate over the next few years.

The new Sustainable Development Goals will, of course, come with significant environmental targets. Clean energy will be a key part of meeting those environmental targets, particularly as the international community seeks to reduce carbon emissions to avoid dangerous climate change. It may come as a surprise to some environmental groups, but that is why coal’s role cannot be ignored as part of this solution.

The first objective must be economic development supported by energy access. To meet environmental objectives the goals must support moves to a low-carbon economy in the most effective and affordable way possible, while meeting the significant energy and development needs across the globe. Attempts will be made to focus exclusively on the role of renewables, moving beyond any fossil fuel capacity. But this would be a misguided approach. Removing coal from the mix would make addressing the energy challenge prohibitively expensive—and would also fail to recognize that coal is part of the low-carbon solution.

Highly efficient modern supercritical and ultra-supercritical coal plants emit almost 40% less CO2 than subcritical plants. This makes them a critical part of the arsenal to reducing global carbon emissions while meeting the world’s energy needs. The role these plants can play needs to be recognized and supported. Although more efficient, these plants are also more expensive. International support is needed to help deploy this advanced technology. Less efficient technologies with greater environmental consequences are likely to prove more attractive on a cost basis than more expensive but also more efficient and cleaner technologies to developing countries who do not receive international support. In the longer run, the same will be true of carbon capture technology. It is in these areas that the Sustainable Development Goals and action by multilateral development banks are critical.

India and countries in Africa and Asia will rightly want to use their own coal reserves to meet their energy needs and fuel their economies. They must be allowed to do this because it is the most affordable and effective pathway for them, but they also must be supported to do so in a way consistent with environmental objectives.

Sustainable Development Goals must recognize the reality of the huge energy needs in the developing world. These needs must be met using affordable and reliable technologies based on national priorities and resources. The goals, and the post-2015 development framework that supports them, must also recognize that, without the support to use their own domestic resources in an efficient and environmentally sound way, economic goals will likely take precedence over environmental ones in developing countries. This would be regrettable because the two objectives should be integrated priorities for both the developed and developing world.



1. International Energy Agency, Defining and Modelling Energy Access. Accessed May 2013, www.worldenergyoutlook.org/resources/definingandmodellingenergyaccess

2.    M. Bazilian, P. Nussbaumer, H. Rogner, A. Brew-Hammond, V. Foster, S. Pachauri, E. Williams, M. Howells, P. Niyongabo, L. Musaba, B. Gallachoir, M. Radka, D. Kammen, Energy Access Scenarios to 2030 for the Power Sector in Sub-Saharan Africa, Utilities Policy, 2012, 20, 1–16.

3.    International Energy Agency, World Energy Outlook 2011: Paris, France.


The author can be reached at bsporton@worldcoal.org.


The content in Cornerstone does not necessarily reflect the views of the World Coal Association or its members.

China’s Coal Industry Must Follow the Path of Sustainable Production Capacity

By Xie Heping
President of Sichuan University, Academician of the Chinese Academy of Engineering
Liu Hong
Energy Research Institute, National Development and Reform Commission
Wu Gang
Sichuan University

In the last 10 years, affected by strong market demand, China’s coal output has continued to increase and its production capacity has expanded at an unprecedented rate, with an annual increase in production of 200 million tonnes on average. In 2012, the total output of coal reached 3.66 billion tonnes. However, based on China’s existing coal mining technologies, this level of output greatly exceeds the sustainable coal production capacity in terms of resources, the environment, and safety. Behind this huge production statistic are excessive waste of coal resources, a large number of casualties among workers, and serious damage to water resources and the environment. These problems are the basis of resistance for the continued development of China’s coal industry.

Sustainable Production Capacity

A longwall mining system can be employed during highly mechanized mining

According to our latest research, which comprehensively examines the various constraints of resources, technology, environment, safety, etc., sustainable capacity for China’s coal mining is only around 1.1 billion tonnes, approximately one- third of current total coal production. In other words, due to limited resources, poor geological mining conditions, natural disasters, environment-based restrictions, and water limitations, only one-third the rate of current coal production in China can be considered rational; the other two-thirds exceeds sustainable capacity and can be considered over-exploitation.

China’s Maximum Sustainable Coal Production Capacity Under Constraints

Although China is rich in coal resources, based on the current massive production rates, every step to enhance the production capacity will be subject to constraints from many unfavorable factors. First, coal production capacity is constrained by resource reserve conditions. Coal resources buried at a depth of 1000 m account for 53% of China’s total reserves. After long-term large-scale exploration, shallow coal resources in the key coal production areas have been depleted, leaving an average mining depth of approximately 600 m. Coal exploration becomes more difficult as the mining depth increases, plus there is also a lag in technology. Therefore, the problems associated with deep mining will increase.

Second, coal production is constrained by safety. Some coal fields in China are more difficult to mine because of their complicated geological structure and high gas content, which leads to frequent mining accidents. The annual death toll in China’s coal production accidents has exceeded 2000, which is the highest in the world in terms of mortality rate per million tonnes. Especially in northern China, the coal fields have inherent safety risks due to the serious threat from the Ordovician limestone water at the bottom of the coal bed.

Third, coal production is constrained by the environmental impacts of mining (i.e., environmental capacity). The hydro- geological conditions and ecology in most of China’s coal-rich regions are fragile because of severe soil erosion, frequent geological disasters (i.e., mudslides, landslides), and low vegetation cover. With further mining exploration, the environment near the mines will be subject to more serious damage, which could result in a considerable threat to the social development and quality of life for the residents in mining regions.

We have conducted a regional analysis to calculate the sustainable production capacity limit under the major constraints of the environment, water resources, geological mining conditions, and safety.

In terms of environmental constraints, due to the fragile ecology of Shanxi, Shaanxi, Inner Mongolia, and Ningxia, the coal production capacity in these regions should be limited to 2.1 to 2.2 billion tonnes. In southwest China, where the use of high-sulfur coal is restricted, the production of middle and low- sulfur coal is approximately 300 million tonnes. Considering the overall situation, the annual mining capacity under the environmental constraints in China should be 4.2 billion tonnes (i.e., equivalent to 3.0 billion tonnes of standard coal).

Coal exploitation is extensive in Shanxi, Shaanxi, Inner Mongolia, and Ningxia. However, due to water shortages in these areas, production capacity should be limited to 2.4 billion tonnes. Water resources have little impact on the sustainable production capacity in other regions, which amounts to 1.9 billion tonnes. Therefore, taking into consideration the constraints from water resources in China, the annual sustainable mining capacity is 4.3 billion tonnes (equivalent to 3.1 billion tonnes of standard coal).

With respect to the occurrence of resource reserves and constraints related to mining conditions, a considerable portion of coal resources are inappropriate for large-scale mechanized production. The mining capacity suitable for mechanized exploitation is approximately 4.7 billion tonnes (equivalent to 3.4 billion tonnes of standard coal); 3.5 to 3.8 billion tonnes (equivalent to 2.5–2.7 billion tonnes of standard coal) of annual capacity are available for high-efficiency mechanized exploitation.

In term of safety, which is determined by geological mining conditions, water resources, and technology, the annual mining capacity in China should be 3.5 billion tonnes (equivalent to 2.5–2.7 billion tonnes of standard coal). Safety during coal mining poses the largest constraint to coal production expansion.

Based on the above analysis, we propose that China’s maximum annual coal production capacity should be limited to 3.8 billion tonnes (equivalent to 2.7 billion tonnes of standard coal) to maintain the healthy and sustainable development of China’s coal industry. See Table 1 for the detailed data on sustainable production capacity based on the various constraints.

Sustainable Production Capacity Table 1

Table 1. Maximum production capacity of China’s coal resources under constraints (units: million tonnes)

A Standard System to Define Sustainable Coal Mining Capacity in China

Our definition of sustainable coal mining capacity refers to the maximum coal mining capacity that can be achieved using safe, highly efficient, and environmentally friendly methods under the premise that the coal reserves can be sustainably mined for a specific time period. Based on the requirements to sustain production capacity under the constraints determined based on resources, safety, technology, the environment, and equipment, we set up an assessment index system to evaluate sustainable production capacity. Three indexes are proposed to define sustainable mining capacity: safety, environment (i.e., green), and mechanization. This assessment system consisted of preparing a hierarchy of metrics, referred to as grade-A and grade-B indexes, wherein the grade-A indexes are primary indexes and the grade-B are secondary indexes. Figure 1 lists the 12 grade-A indexes; there are also 22 grade-B indexes that are not shown.

Sustainable Production Capacity

Figure 1. Assessment index of the sustainable coal production capacity


The safety level refers to the degree of safety and health protection for coal miners in the process of production and operation, placing an emphasis on a low accident rate, low incidence of occupational diseases, and guaranteed occupational safety and health in accordance with the “people-oriented” development concept. This index contains four grade-A indexes and seven grade-B indexes.


The environmental (i.e., green) level refers to the degree of protection provided to the environment in and around the mining areas during coal production. The environment level is based on complying with environmental regulations and addressing the environmental problems caused by traditional mining processes. It requires achieving the environmental benefits associated with a high recovery rate of coal resources, while minimizing the overall impact to the environment. In addition, the environmental level is characterized by the simultaneous extraction of other resources without negative environmental impacts. This index contains four grade-A indexes and eight grade-B indexes.


The mechanization level refers to the degree of utilization of the most efficient mining mechanization appropriate for the specific geological conditions. The mining mechanization level emphasizes efficient mining and the overall production efficiency rate, widespread use of technology and improvement through analytical assessment, and better equipment adaptability. This index consists of four grade-A and seven grade-B indexes.

Using our assessment system, we completed a comparative study on the sustainable capacities of coal mining, ranking the world’s major coal mining countries. The results are provided in Table 2.

Sustainable Production Capacity Table 2

Table 2. Comparison of sustainable coal mining capacity between China and the advanced coal mining countries in the world

Scale and Regional Distribution of Sustainable Coal Mining Capacity in China

According to the assessment system, we estimated the sustainable coal mining capacity in China, including a breakdown of the major coal production areas, and came to the conclusion that the current sustainable production capacity in China is approximately 1.1 billion tonnes, that is, approximately one-third of the current national annual output.

In addition, we developed a preliminary forecast for potential improvement of China’s sustainable coal mining capacity in the future. By 2030 it is projected that the sustainable coal mining capacity in China’s existing mines could increase to 1.50–1.63 billion tonnes. Sustainable coal mining capacity in new mines may reach 1.58–1.89 billion tonnes by a conservative estimate, or up to 1.90–2.11 billion tonnes based on an optimistic estimate. The total sustainable capacity of coal mining in 2030 is estimated to be 3.0–3.5 billion tonnes, which can basically meet the projected coal demand in China at that time. After 2030, China’s annual coal demand is not expected to increase or change dramatically, so the total sustainable coal production capacity will be maintained at approximately 3.0–3.5 billion tonnes.

According to our analysis of major coal mining regions within China, the sustainable mining capacity in Shanxi, Shaanxi, Inner Mongolia, Ningxia, and Gansu is approximately 648 million tonnes, accounting for ~60% of the national sustainable capacity. It is estimated that by 2030, the sustainable mining capacity in this region could increase by 1.06–1.13 billion tonnes. The sustainable capacity of coal mining in east China is approximately 330 million tonnes, or ~31% of national sustainable capacity. By 2030, the sustainable mining capacity in this region could increase by 300–350 million tonnes. The sustainable mining capacity in northeast China is about 55 million tonnes, or 5.1% of the national sustainable capacity. The predicated sustainable mining capacity in this region could increase by 90–100 million tonnes by 2030. Sustainable mining capacity in south China is approximately 20 million tonnes, or 1.86% of the national sustainable capacity. This can be expected to increase by 30–50 million tonnes by 2030. Sustainable mining capacity in the Xinjiang-Qinghai area is about 25 million tonnes, or 2.32% of the national sustainable capacity and 25% of local coal output. Such capacity in this region could increase by 20–30 million tonnes by 2030. See Table 3 for the sustainable capacity and regional distribution of coal mining in China.

Sustainable Production Capacity Table 3

Table 3. The sustainable coal mining capacity in 2010 in China by coal production region

Development Path Toward Sustainable Coal Mining Capacity

In order to facilitate China’s progress toward achieving a sustainable coal mining capacity and to thoroughly improve mining-related issues and prevent over-exploitation, it is necessary to establish an improved policy and standards system and set the mandatory market threshold (i.e., production limit) based on the sustainable capacity. To increase the sustainable capacity of coal mining in China, we propose taking measures such as integration of the country’s coal resources as well as merger and reorganization of coal mining enterprises to accelerate the development of large- scale modern groups that will possess advanced technical capabilities, and especially make progress on construction and demonstration of the nationally planned 14 large-scale coal production bases with the mindset of achieving sustainable capacity development.

The development of a sustainable coal mining capacity in China can be implemented in “three steps”. First, from 2010 to 2020, there will be a mandate to “maintain the existing sustainable capacity coal mines, upgrade some coal mines to a sustainable capacity level, and focus on new coal mines that follow a sustainable capacity standard”. Specifically, this means that it is important to (1) maintain the mining capacity of the existing one- third of mining operations that have already reached the standard of sustainable capacity, (2) improve another one-third that have yet to meet the standard, but can be upgraded by means of technological development and innovation, and (3) gradually eliminate the remaining one-third of mining operations that will not be able to meet the standard. We propose that it is possible, and necessary, for China’s coal industry to make the adjustments listed above to be on the path toward achieving a sustainable coal mining capacity before the year 2020. As the second step, from 2020 to 2030, we propose achieving the goal of a sustainable coal mining capacity throughout China. And finally, from 2030 to 2050, we believe that China’s coal industry could establish a sustainable coal production industry and become a world leader in in the field of coal exploration.

The authors can be reached at xiehp@scu.edu.cn and liuhong@eri.org.cn.


Coal Exporters

Coal reserves are available in almost every country worldwide, with recoverable reserves in nearly 80 countries. Although the biggest reserves are in the U.S., Russia, China, and India, coal is actively mined in more than 70 countries. By contrast, Russia, Iran, and Qatar control 53.2% of the world’s gas reserves, and over 50% of the world’s oil reserves are located in the Middle East. Most coal is consumed domestically; only 15% is traded internationally. In a number of countries coal is also the only domestically available energy fuel, and its use is motivated by both economic and energy security considerations. This is the case in countries and regions such as Europe, China, and India, where coal reserves are much higher than oil or gas reserves. Most of the world’s coal exports originate from countries considered to be politically stable, a characteristic that reduces the risks of supply interruptions. A list of the top coal exporters is shown in the table below.

Coal Exporters

Source (text): WCA Coal Matters Factsheet (www.worldcoal.org) Source (table): IEA Coal Information 2011 (wds.iea.org)

The content in Cornerstone does not necessarily reflect the views of the World Coal Association or its members.