Effective Coal Utilization Must for Energy Security

There is no debating the point that coal is and will be the prime mover of the Indian energy sector. This has been the case primarily due to the availability of coal in abundance and affordability of energy produced from it. Effective usage of coal must be devised as strategy for Indian growth engine to continue firing on all cylinders. Power generation through combustion has to be made environment friendly through coal washing. In Coal Beneficiation Technology summit held in Ranchi in August 2007 under Asia Pacific Partnership for Clean Development and Climate (APP), organized by its Coal Mining Task Force, it was generally agreed that coal washing will help India improve its performance on the environmental front. There is a variety of coal beneficiation technology options ranging from dry in-pit washing to crushing-and-wet washing through jigging or floatation to lower ash content. Dry washing and selective mining can significantly optimize coal costs by reducing the haulage of wastes even from the mining face to pit head. The prime reasons for coal washing are reduction in transportation cost, lowering ash content to improve power plant efficiency and lower generation of harmful gases to protect environment. Also, the large amount of power plant ash causes major problem of disposal, which can be better substituted by washing and disposing off washery rejects at the mine site through filling in the excavated areas.

There are other technologies that can complement traditional coal mining activities and help India secure its energy needs. Underground coal gasification (UCG) is one of the key technologies which can also help tapping coal resources that can not be mined economically with the existing mining technologies. It has been assessed that coal that are deep seated, particularly so the tertiary reserves in Gujarat, are amenable to underground gasification. This method of energy extraction from coal reserves will not be competing with the coal available for other purposes and will only convert a potential into exploitable resource. UCG also will provide energy with minimum surface disturbance and no requirement of surface disposal of ash. There are, however, some unique application prerequisites for UCG like the coal seam being under water aquifer and impervious rock bed; and coal seams being relatively uniform and un-faulted. The applicability of the technology, therefore, needs to be assessed in greater details in light of the geological conditions in Indian coalfields.

Coal-to-liquids (CTL) and coal-to-gas (CTG) conversions are now included as approved end-usage for captive coal mine allocation. The technologies have been commercially proved globally and can help India reduce oil imports. According to some media reports, coal conversion to petroleum products becomes economically viable if the crude prices are above USD 45 a barrel. In light of the higher current prices and future expectations, the CTL technology appears viable. Production of petroleum products from coal will reduce country’s import dependence particularly so from the politically unstable locations. Production of intermediate syn-gas can be useful even for fertilizer production and replace usage of naphtha.

The other prominent ways of extracting value from coal are coal bed methane (CBM), coal mine methane (CMM) and abandoned mine methane (AMM). In India, CBM has been more successful than the others. Recently, first CBM based CNG gas station has been reported to be opened in West Bengal, which is likely to enhance investor confidence. Coal India Limited has also initiated the process of developing CMM and AMM resources through public-private-partnership. It, however, remains to be seen if the initial interest exhibited by the bidders culminates into commercial exploitation of methane, which also is good for carbon credits.

Apart from technical and economic feasibilities, there are concerns about coal reserves being sufficient enough for power generation and such other usages, which are likely to compete for coal reserves that are sought to be used for conversion to gas and petroleum products. Pointer in this regard is the low extent of exploration activities in coal sector. According to Coal Vision 2025 document, vigorous exploration efforts in the next two decades can help improve the confidence on coal reserves. The current assessment of resources of about 248 billion tonnes, with additional prognosticated resources of 143 billion tonnes, has only about 93 billion tonnes of proved reserves. Upon applying United Nations Framework Classification (UNFC) the extractable reserves shrink to about 52 billion tonnes, giving rise to concerns about insufficiency. Detailed exploration with private participation will do a lot of good to the industry and will help policy formulation for coal utilization through alternative technologies.

A comprehensive policy is required to be formulated for the purpose of effective and efficient utilization of nation’s coal resources. The abundance of coal promises to provide energy at affordable prices and can be substitute of expensive imports to significant extent. However, the technological and economic viability have to be established and the government-owned agencies as well as private and foreign participants need to be provided incentives to invest in the sector. Provision of energy is paramount to the continued growth of the economy and harnessing coal resources is undoubtedly one of the most important ways to secure India’s energy needs.

(This article was published in the Economic Times)