Coal gasification is reliable, will strengthen India's energy security

Serious efforts are needed make this energy supply alternative a success

India is the third largest consumer of energy in the world and heavily dependent on its import. The country imports nearly 80 per cent of its requirements of crude oil and 50 per cent of natural gas. In 2022-23, it imported nearly 10 per cent of its coal consumption. There has been rapid progress in installing renewable power capacity in recent years, reaching approximately 180 gigawatt and with the target of 500 GW by 2030.

But the operating factor of renewable power plants is only 20-25 per cent, compared to 80-85 per cent for thermal power plants using coal or natural gas as fuel. The contribution of renewable power, including hydropower, in total generation was about 16 per cent in 2022-23. Renewable energy’s contribution in meeting the increasing energy demand will likely be limited in the near term. Therefore, the country will be dependent on conventional energy sources in the near and mid-term. We have to explore and exploit all possible energy sources.

 

Coal remains the workhorse of our energy sector. Coal and lignite contributed nearly 73 per cent of power generation in 2022-23. India has abundant reserves of coal and it is only natural that utilise it to meet a major part of our energy requirement.

The Coal Gasification Scheme, which was announced in the Finance Minister’s Budget speech in February, aims to gasify 100 million tonnes of coal by 2030. It is a step in the right direction. The government has also approved financial assistance up to 15 per cent of cost both for public and private sector projects. Synthetic natural gas or coal gas generated from coal gasification can be used as either fuel or as feed for manufacturing chemicals like ammonia and methanol. Coal gas can also be used to generate power. In fact, a combined cycle power plant based on coal gasification gives much higher efficiency than conventional coal-based power plants. Composition of coal gas can be varied to cater to the requirement of downstream consumers who will use it either as fuel or feed or both. Coal gas can also be transported through existing pipelines. This will reduce the load on Railways, a major transporter of coal.

Coal gasification technology has a long history. South Africa and China are pioneers in utilising coal gasification for manufacture of fertilisers and chemicals. In India, two large fertiliser plants based on coal gasification were commissioned in 1980, at Talcher and Ramagundam. Unfortunately, these plants did not perform well for a variety of reasons. The ash content in the coal supplied to these plants was higher than the design coal input for gasifiers. The problem could have been addressed by installation of an additional gasifier. But continuous disruption in power supply and poor performance of other equipment added to the woes. Lack of additional investment to resolve these problems rendered the facilities unviable. With losses mounting, the two plants were shut down in 1999. All later generation fertiliser plants installed captive power plants and proven equipment and have performed well. It was patently unfair to blame coal gasification as the reason for poor performance of coal-based plants.

Subsequently, there have been serious efforts to develop indigenous technology for coal gasification suitable to Indian coal. There was significant success with operation of pilot plants. At one stage, there were studies in the 2000s to put up a fertilizer plant and a power plant based on coal gasification. A few other industries, including steel, put up coal gasification plants. But no substantial progress was made.

The government, as part of its policy to increase urea production for self-reliance, sanctioned the construction of six gas-based urea plants that were commissioned in the last five years. A coal-based urea plant was also part of the plan and is under construction at Talcher. It is likely to be commissioned in the next financial year. Latest advancement in coal gasification technology and better design of equipment should make the new plant successful. It will also be a viable route due to the high cost of competing fuel i.e. natural gas. The bonus will be that a major part of carbon dioxide generated in the process will be used for production of urea.

If the target of gasification of 100 million tonnes of coal is achieved by 2030, it will more than double gas production in the country. The challenge remains that Indian coal is not of very good quality and has low heat value due to high ash content reaching as high as 35 per cent. There are a number of washeries at the pithead which remove excess ash. This is called the beneficiation process. While the beneficiation process is well established, its economics is not always favourable due to loss of carbon and hence the fuel along with rejects. Therefore, one has to optimise the extent of beneficiation to minimize the losses. If ash content is not very high, say less than 15 per cent, it may be better to use run of mine coal without beneficiation.

It is hoped that Coal India Ltd (CIL), the driver of the gasification scheme, and others make due diligence regarding type of feed coal, gasification technology to be used, composition and heat value of gas produced and tie-up with downstream consumers. It is heartening to note that CIL has started the consultation with stakeholders, including potential investors and consumers of synthetic natural gas. This is essential to avoid half-hearted efforts made in the past and make this energy supply alternative a success.

The writer is chairman of Indian Institute of Chemical Engineers (Northern Region Centre) and he was additional director general, Fertiliser Association of India.

These are the personal opinions of the writer. They do not necessarily reflect the views of www.business-standard.com or the ‘Business Standard’ newspaper