RWE Plans German and U.K. $1.2 Billion Clean Coal Power Stations with Integrated CO2 Storage

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Researched by Industrial Info Resources (Sugar Land, Texas). In the space of a few years, the quest for emission free coal-fed power stations has transitioned from ‘clean’ to ‘cleaner’ to ‘cleanest’ and has now moved onto the integration of storage of CO2 emissions into power projects. Between the end of March and mid-April, the German energy giant RWE (OTC:RWE) (Essen, Germany) announced two clean coal power generation projects, one in Germany and one in the U.K.

A decision will be made in the second half of 2007 on the energy source and site for a 450-megawatt power plant in Germany, which RWE claims will be the first large-scale power plant worldwide with integrated coal gasification and CO2 storage. Planning for the project has begun and the results of research will determine whether hard coal or the gasification of lignite will be the preferred feedstock route. Currently, lignite, a non-subsidized domestic energy source, appears to be in favor. A government permitting framework and authorizations and approval by the responsible RWE supervisory boards are necessary before final commitment to a commissioning date of 2014 for the plant.

It is estimated that the project will require an investment of $1.2 billion, which will cover construction of the plant and the transport and storage of CO2. A subsidiary, RWE Dea, which is primarily engaged in the exploration and production of petroleum and natural gas, has the geological research expertise to assist in evaluating the suitability of onshore CO2 depositories.

RWE has already shown its intention of extending the frontier of state-of-the-art power plants with technologies for a new generation of plants to be constructed after 2010 with the focus on lignite fluidized-bed drying. Claiming world leadership in the field, RWE is also testing high temperature materials with a steam temperature of 700 C compared with the current 605 C. These techniques will increase the energy efficiency of lignite-powered power stations to more than 50%.

The company is also working on procedures for downstream CO2 scrubbing. If successfully developed, these could be implemented to upgrade existing power plants and be installed in the new generation of CO2 free plants.

A feasibility study has been started by RWE npower in the U.K. for the construction of a ‘clean coal’ power plant at Tilbury on the River Thames estuary. Utilizing the new carbon capture and carbon storage technology, the plant could reduce the current levels of CO2 emissions at the existing 1968 vintage 1,428-megawatt Tilbury power station by as much as 90%.

The main elements of the clean coal gasification technology to be used in the German plant are being proposed for the $1.2 billion Tilbury project. Various options will be studied for CO2 storage, including geological formations, depleted oil reservoirs and depleted natural gas fields. The study will also look at the end-to-end process from planning and consent to transport and storage options. The company’s testing facilities at Didcot, Oxfordshire, will examine ways to improve combustion efficiency and develop the chemical processes for stripping out and capturing the carbon dioxide.

Andy Duff, CEO of RWE npower, said that the investment the company was making in new technologies presented a significant risk and more regulatory certainty was needed over environment standards under the E.U. Emissions Trading Scheme, which RWE feels government support is necessary in phase 3 over a minimum of fifteen years, which would more closely align it to investment cycles.

“The U.K. needs to maintain a broad mix of energy generation to guarantee secure electricity in the years ahead. We also need to hit environmental targets aimed at tackling global warming. Both these goals can be achieved by the energy industry under the current market framework, provided the government adopts a supportive approach to investment, streamlining regulatory processes and pump-priming advanced technologies,” said Duff.

RWE is planning to invest $ 14.5 billion into power generation projects in Germany through 2020 and $ 790 million into the expansion of renewable energy sources over the next five years

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