China's search for cleaner coal

The World's Mary Kay Magistad reports on China's efforts to develop so-called �cleaner coal� technologies. Burning coal causes huge problems in China and a large part of the world's greenhouse pollution. But it's likely to remain the country's main energy source for decades. In part two of her series, Mary Kay Magistad looks at China's efforts to develop so-called �cleaner coal� technologies.

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One day in November, when Beijing's air was so thick with smog you couldn't see buildings a block away, the pollution monitor at the US embassy listed the air quality as �crazy bad� � perhaps, a computer programmer with a sense of humor's attempt to describe a reading way beyond hazardous � above the maximum on the international scale.

Like many Chinese cities, Beijing is choking on smog � some from traffic, much from coal-fired power plants and factories. The cost to China is a host of health and environmental problems � from rampant respiratory disease to soaring emissions linked to climate change. China is already the world's largest producer and consumer of coal� and the demand continues to grow.

So what to do? How can China use coal to reach for a better life for its people, but stop choking on its own growth. Part of the answer was on display at a recent Coal Industry Exhibition in Beijing.

Flashy videos and polished displays at the Exhibition hit a new set of themes � sustainability. Safety. And what's being called �clean coal.� At an associated international coal industry conference, Wu Yongping, chairman of the Datong Coal Mine Group, one of China's biggest coal companies, said his company is starting to embrace a new green culture.

�Green recycling, green technology and green culture will be our core values,� he said. �We will create a standard to help transform the coal industry. This includes how we mine for coal, and how we use it. We need to reduce our use of energy, our emissions and the environmental damage we do as much as possible, while maximizing the value of the coal we use.�

Wu said Datong Coal Mine Group has already taken steps to reduce the environmental impact of its coal mining, and cut emissions from heating and power generation. It's probably no coincidence that Premier Wen Jiabao visited Datong Coal last year and has been calling for much the same thing.

Over the past couple of years, the Chinese government has undertaken a campaign to shut down the country's oldest, most heavily polluting power plants. But for every dirty one shut down, two new coal-fired power plants have opened up. It helps that many of the new ones are more efficient, and cause less smog. They're looking to cut emissions even more, and doing that appears to be increasingly within reach..

�There are ways to generate electricity from coal with pretty much zero emissions,� says Ming Sung, who heads the nonprofit Clean Air Task Force in China, and who helped design Shell's first coal gasification plant in the United States in the 1980s. �The key thing to have clean coal � you need first to gasify the coal. Make coal into a gas, either above ground � which is a traditional coal gasification technology. Or you can go underground. It's very efficient, and very low-cost. And that is the technology I feel will change the landscape.�

And carbon dioxide that's removed, or �captured,� can be used to put the fizz into Coca-Cola, or sparkling wine, or it can be used for dry ice � or even to make ceramic tiles, so the carbon brings some profit to the power plant that's capturing it. Carbon dioxide is also pumped underground in the United States to help enhance oil recovery. It can also just be pumped underground and sequestered, mostly in saline aquifers, or even under the ocean floor.

Some Chinese businessmen in the power sector complain that pumping carbon underground is like burying money, especially since a power plant using carbon capture equipment needs to use about one-third more energy to generate the same amount of power. The equipment itself is also expensive, when retrofitting an existing power plant. The idea that captured carbon has a monetary value � that it can be sold for a profit and put to use � would go a long way to selling the technology to the skeptical. That � or the government could either offer enough tax incentives and subsidies to those who do it, or stiff enough penalties to those who don't, that the technology spreads, and emissions are reduced.

For now, carbon capture is still in pilot project phase � and China has two working power plants that capture carbon after coal is burned. Both are owned by the Huaneng group a state-owned enterprise, and one of China's biggest utility companies. The one in Beijing opened in July 2008, just in time for the Olympics. The one in Shanghai opened just before this year's Shanghai Expo � the equivalent of the World's Fair. Both use the same kind of technology.

�It is comprised of two systems, the capturing system and the refining system, where we improve the purity,� says Beijing plant manager Cai Hongwang. �And then we cool it down and compress it, and store it in a tank. The purity of the CO2 can reach 99.99 percent.�

In addition to these post-combustion plants, or plants that capture carbon after coal is burned, a pre-combustion power plant � one of the first in the world � is scheduled to open next year in the city of Tianjin, near Beijing. The US-based Duke Energy plans to open another, in the United States. Ming Sung of the Clean Air Task Force says, at this early stage in the game, there's room for everyone � especially with global warming at stake.

�It's very typical in the industry that in the beginning, we will work together to improve the technology, benefit each other, and whatever we have, we have the world to sell to,� says Ming Sung. �Right now, there's plenty of market space. And working together, we make it cheaper, faster, more efficient.�

And that's all good, because at the moment, the options are all still pretty expensive. Juho Lipponen, who heads the International Energy Agency's carbon capture and storage unit, says even when the prices come down, carbon capture and storage carbon capture and storage will be only part of the answer to the world's growing emissions.

�Carbon capture is an important area, but it's not a silver bullet,� Lipponen says. �It can maybe deliver one-fifth of total reduction requirements in 2050 � or it may not, if you don't find the storage sights and don't get the permits in place.�

But Lipponen says carbon capture is often the only solution for existing industries with heavy emissions � industries like gas, pulp, paper, steel, cement, which rely on coal, and which drive much of China's urban expansion and economic growth.

And that matters, because China's industrial sector uses about 70 percent of total energy, with much of it concentrated among about 1,000 state-owned enterprises. That means if the government decides to adopt a new carbon capture technology, it can be quickly deployed.

Meanwhile, the Chinese government is putting pressure on all energy users to become more efficient. It has set a national goal to reduce the amount of energy used, per unit of GDP, by 45 percent by 2020, compared to 2005 levels. But � since China's GDP is still growing fast, emissions will continue to rise, but more slowly than they would have otherwise.

It helps that the government has, in recent years, let the price of coal float to international market prices � which are now 45 times higher than the price within China 10 to 15 years ago. There's also a new ladder system for electricity fees � so consumers pay more per unit as they use more. And there are new requirements for better energy efficiency in buildings, which use a significant share of China's power. Most of China's existing buildings are insulated badly, if at all.

At the recent Shanghai Expo, visitors crowded in to a pavilion called �Urban Best Practices.� The pavilion was one of several energy efficient buildings at the Expo � this one built with help from the Italian government. Environmental engineer Maria Pia Ancora was one of the project managers.

�This building has been designed to minimize energy consumption, starting from the orientation of the building, which is meant to maximize solar exposure,� she says. �On the roof, you can see cases, designed to host solar panels and provide electricity for the building. The shell of the building is a very special fabric, Italian technology, meant to shelter it from heat and cold in a very efficient way.�

Ancora says she's been working on similar projects in Beijing and Shanghai over the past six years. While such buildings are still in their infancy in China �they're catching on � with a few growing pains.

�With one of the (green) buildings in Beijing, it took three years to convince them to manage it properly, so it was a truly energy-saving building,� Ancora says. �It takes time. It takes a lot of training. And you have to have people dedicated to that. You can't let people improvise, like improvising with building management, or on building design.�

That said, Ancora says she's been fortunate to work with �very professional people in the Chinese government, seriously committed to do better. And I see changes in the way that Shanghai and Beijing already properly manage the cities, in terms of their environmental protection strategies.�

But as the off-the-charts pollution readings in Beijing suggest, this is very much a work in progress. Many of China's thousands of cities and towns � and much of its industry � have yet to get religion on energy conservation.

For all the talk of clean and green, energy from coal is still the main game here. China's leaders have declared their determination to use it more efficiently and burn it more cleanly. But the country is still expected to use 60 percent more coal in 2030 than it does now. With costs on the rise � to the environment, to human health, and to the bottom-line, the stakes are high for everybody � here in China, and around the world.