DEMONSTRATION WORK BEGINS AT AUSTRALIAN OXYFUEL PILOT PROJECT

Tamar Hallerman
GHG Monitor
12/21/12

Developers of Australia’s first oxyfuel combustion capture pilot started demonstration work this weekend on a 30 MW retrofit project located in Queensland on the country’s east coast. A ribbon-cutting ceremony Dec. 15 kicked off what is expected to be two years of demonstration work on the $208 million Callide Oxyfuel Project in Biloela, Queensland. Joint venture partners CS Energy, Xstrata Coal, Schlumberger, J-Power, IHI-Corp. and others hope to capture 70 tons of CO2 per day from Unit 4 of CS Energy’s previously-mothballed Callide A Power Station for storage in a nearby deep saline formation. Developers said the project is one the world’s largest demonstrations of oxyfuel combustion technology currently in operation. “This signals a major step forward for the project and the demonstration of how carbon capture technology can be integrated with existing coal-fired power stations,” Project Director Chris Spero said in a statement. Officials from the Callide project did not respond to requests for comment.

The Callide project, which has strong financial backing from both the Japanese and Australian governments, has been under development for the better part of eight years and began operating its first boiler in full oxy-firing mode in March. During the facility’s ribbon-cutting, Australian Minister for Resources and Energy Martin Ferguson said the government would be providing Callide with an extra $13 million to help extend the duration of demonstration work to allow for 10,000 cumulative operating hours. “The extension provides stakeholders with greater commercial confidence in the proposed technology, and allows the project team to meet its CCS objectives, including storing some of the captured carbon dioxide,” Ferguson said.

Callide One of the Largest Oxy Tests to Date

Callide is currently among the world’s largest oxyfuel demos. While the technology has been demonstrated on the smaller scale elsewhere over the last several years, Callide is the first project to bolt the technology onto an existing large-scale facility, developers said. Similar-sized pilot units have been tested in Germany and France, while a 30 MW pilot project currently under development by CIUDEN in Spain is moving toward fully-integrated operations. A handful of large-scale projects have also been announced in Europe, China and the U.S., but most have been slow to move forward.

The oxyfuel combustion process burns fuel with high-purity oxygen instead of air, which eliminates nitrogen in the flue gas and instead produces a highly-concentrated CO2 stream. The technology holds potential because it allows for the treatment of smaller volumes of flue gas, according to Jared Ciferno, director of the Office of Coal Power at the Department of Energy’s National Energy Technology Laboratory, and has the potential of being cheaper and more efficient than other carbon capture technologies currently on the market. “The advantage with oxy is that you can achieve near-zero carbon emissions because you can capture almost all of the flue gas,” he said. “It can also remove criteria pollutants like mercury, SO2 and NOx easier and there’s more opportunities for [equipment] efficiencies. But with all of those benefits, the process is still costly and energy intensive.”

Governments Stand to Gain from Demo Work

Despite those high initial costs, both the Japanese and Australian governments potentially have a lot to gain from the pilot, if successful, given that both are looking to beef up their CCS industries and reduce emissions. Japan announced its intention to move forward on its first CCS demonstration project, Tomakomai, earlier this year, but is still in the very early process of developing its CCS industry. Japan also relies on coal imports from countries like Australia for a sizable chunk of its electricity generation, a sector that has been in flux since the Fukushima Daiichi nuclear disaster in March 2011.

Meanwhile, Australia remains the world’s largest CO2 emitter per capita as coal generates more than three-quarters of the country’s electricity. But in recent years, the country has aimed to clean up its electricity system, enacting last summer a $23 per ton carbon tax and recently extending its commitment to emissions reductions under the Kyoto Protocol through 2020. The country has a further goal of reducing emissions 80 percent below 2000 levels by mid-century. Australia is betting heavily on CCS paying off and helping the country reach those emissions reduction coals. Several large-scale projects are expected to come online in the coming years, including the Gorgon CO2 Injection Project.

The Australian Coal Association, which provided upwards of $75 million to help develop Callide,  lauded the project this week as a “landmark” one between Australian and Japanese companies and governments. “The project is hugely significant because it is a first-of-kind demonstration project, underlining the potential for new build and retrofitting existing power stations with carbon capture technology in Australian conditions using Australian coal,” Deputy CEO Greg Sullivan said in a statement this week.