Technical Assistance Consultant’s Report Project Number: 46052 March 2015 People’s Republic of China: Roadmap for Carbon Capture and Storage Demonstration and Deployment (Financed by the Carbon Capture and Storage Fund) Component B–Oxy-Fuel Combustion Technology Assessment Prepared by Andrew Minchener, Team Leader (International CCS Expert) Zheng Chuguang, Deputy Team Leader (National CCS Expert) Liu Zhaohui, International Carbon Storage Expert Jiao Zunsheng, International Carbon Storage Expert Pei Xiaodong, International Economic and Financial Analyst Li Xiaochun, National Carbon Storage Expert Zhao Haibo, National Energy Economist Chen Ji, National Policy Analyst Gao Lin, National Road Mapping Expert Xi Liang, National Financial and Risk Analyst For: Department of Climate Change, National Development and Reform Commission (Executing Agency) Dongfang Boiler Group Co. Ltd (Implementing Agency) This consultant’s report does not necessarily reflect the views of ADB or the Government concerned, and ADB and the Government cannot be held liable for its contents. (For project preparatory technical assistance: All the views expressed herein may not be incorporated into the proposed project’s design. Road Map for Carbon Capture and Storage Demonstration and Deployment Component B: Oxy-fuel Combustion Technology Assessment FINAL REPORT Andrew Minchener, Team Leader (International CCS Expert) Zheng Chuguang, Deputy Team Leader (National CCS Expert) Liu Zhaohui, International Carbon Storage Expert Jiao Zunsheng, International Carbon Storage Expert Pei Xiaodong, International Economic and Financial Analyst Li Xiaochun, National Carbon Storage Expert Zhao Haibo, National Energy Economist Chen Ji, National Policy Analyst Gao Lin, National Road Mapping Expert Xi Liang ,National Financial and Risk Analyst March 2015 ADB TA‐8133 (PRC) People’s Republic of China: Road Map for Carbon Capture and Storage Demonstration and Deployment Component B: Oxy-fuel Combustion Technology Assessment Final Report November 2014 Summary The ADB TA project TA8133-PRC People’s Republic of China: Road Map for Carbon Capture and Storage Demonstration and Deployment Component B has focused on oxy-fuel combustion as a promising CO2 capture technology, which offers significant CCS potential within the Chinese context. This technical assistance project has been designed to promote the implementation of a full chain 200MWe oxy-fuel demonstration, while also providing in- depth technical-economic-environmental-social assessment of Chinese oxy-fuel demonstration and deployment. The aim is to identify the current gaps, challenges, synergies and priority topics for the oxy-fuel CCS demonstration in China. It has been implemented under the overall supervision of the Executing Agency, the National Development and Reform Commission, and there is close cooperation with the Implementing Agency, the Dongfang Boilers Co. Ltd., in order to address the issues for the technological transformation to oxy-fuel combustion carbon capture, transport and utilization/storage at the 200MWe Shenhua Guohua Shenmu power plant, which has been designated as the site for a subsequent demonstration project. The key findings are as follows: WP1 Oxyfuel technical consideration and assessment Oxy-fuel combustion is the process of burning fossil fuel using pure oxygen instead of air as the primary oxidant. The concentration of CO2 in dry flue gas can reach more than 80%, and after a simple purification process this can be increased to more than 95% so as to meet the needs of large-scale pipeline transportation and utilization/storage. The oxycombustion technology has been the subject of considerable research and development work both in China and worldwide, covering system design, calculation method for boiler performance and combustion, pollution control, operational flexibility, monitoring and optimization. This has progressed from fundamental studies, laboratory rig trials, through to industrial pilot scale projects. The work indicates that the technology shows considerable energy and environmental promise for coal firing power plants with CCS, offering a synergetic removal of conventional pollutants such as SOx and NOx as well as CO2, which provides a near zero emissions clean coal utilization technology. It appears well suited to both new build and retrofit applications since it maintains the original power plant structure by combining a conventional combustion process with a cryogenic air separation process. These major components are mature technologies that have been extensively deployed. Oxycombustion appears to be relatively economically attractive compared to other coal based carbon capture processes, namely post-combustion capture and IGCC. That said, it is a new technology, and, as yet, there are no large-scale oxycombustion full CCS chain demonstration power plants established worldwide, although the USA and UK governments are now taking forward such projects. Consequently, the economic assessments are still subject to a high level of uncertainty. It is also important to put such comparisons in perspective. At present all three major technology options would appear to have opportunities to reach the stage of market deployment due to their specific strengths. In this regard, oxyfuel combustion appears more suited to deployment as a base load unit because of a relatively weak load adjusting capability compared to the other options, of which in particular post combustion capture has reasonable CO2 capture capability at part load. Oxyfuel is also readily suitable both for new and retrofitted coal-fired plant, with the potential to reduce the overall CCS chain cost for deep aquifer storage where relatively low CO2 purity, say less than 95%, can be used. In contrast, for EOR usage, in which over 99% CO2 purity is generally needed, an increased energy penalty for oxy-combustion would be expected that will take away some of its perceived cost advantages. With regard to establishing a near to medium term roadmap for oxycombustion technology deployment in China, the need is to take into account the date when CCS commercial implementation is likely to be taken forward, the drivers for such implementation, together with the scope to improve upon what CCS technology is available at present. Thus at some point in 2020-2030, China could establish large scale CCS technology deployment, which means that with the wish to exploit its own IPR, such technologies will need to be identified with the first large scale demonstrations to be taken forward in the near future. Taking 2030 as that point, the projections are that the number of new coal fired plants beyond that date to, say, 2050 will be relatively small. Consequently, if China then wants to achieve major CO2 reductions from the coal power sector, that reduction will mainly have to come from existing coal power plants. Those plants built since 2015 will almost all be large, high efficiency, ultra-supercritical units with capacities of at least 660MWe and mostly 1000MWe. From 2025, the expectation is that there will be a new generation of advanced ultra-supercritical coal fired power plants being installed with ever higher cycle efficiencies in the range of 50% and capacities of perhaps 1300MWe. Such High Efficiency Low (non- GHG) Emissions (HELE) power plants will be best suited for retrofit CCS applications. This means that to ensure that the plants built from, say, 2015 can have CCS retrofitted then a significant number will need to be made CCS-ready, such that CCS retrofit can readily be accommodated in due course. In contrast, pre-combustion capture technology via IGCC will only be suitable for new applications and then only if the technology can be shown to perform in line with required power station operational practices. This scenario means that the retrofit choice will be between oxycombustion and post combustion capture. When this is considered, the choice is likely to be regional. Thus oxyfuel combustion will be an attractive proposition, with better prospects than post combustion capture, in regions that have stressed water resources. Based on current water resources and the future distribution of newly built coal-fired power station in China, about 30 to 40 percent of CCS-ready power stations should be designed to be able to subsequently incorporate oxy- fuel technology. The exact capacity level depends on the extent of CCS to be deployed by 2030 but levels close to 100GWe have been suggested. As well as defining the schedule for a near term technology demonstration, there is a need for supporting R&D activities will need to address the scope for scale up of oxy-fuel equipment and system integration technology with better energy performance and lower costs of critical components. These will include future technology innovation to achieve lower cost air separation units (ASUs), and the development of a CO2 compression and purification unit (CPU) with simultaneous impurity gas separation, as both possibilities can be expected to reduce the overall oxyfuel technology costs significantly. WP2 Prefeasibility assessment support for the 200MW oxy-fuel coal-fired demonstration power plant A pre-feasibility assessment of the application of oxy-fuel combustion CO2 capture technology to a 200MWe coal-fired power plant has been undertaken to support the implementation of the intended oxy-fuel demonstration project of the Shenhua Group. The more promising design for such a demonstration plant has been identified as one where it can be air combustion/oxy-fuel