POWER October 2013 - 56

COAL-TO-GAS CONVERSIONS
8. Many upgrade options. The price of electricity changes significantly based on the
suite of environmental upgrades required and the amount of natural gas cofired with coal.
Source: Black & Veatch
FGD + SCR
FGD only
90
80
70
60
50
40
30
20
10
0% Gas
25% Gas
a discount rate of 7%.
The busbar electricity costs were evaluated.
The analysis found that at 75% natural gas cofiring
the SCR system was no longer needed
and at 100% natural gas cofiring the installation
of the FGD and all other emissions equipment
was avoided (the existing SNCR system was
assumed to remain in place for NOx
control).
It was determined through the course of
this analysis that the estimated future price
of natural gas was the primary variable and
economic risk factor. Given the recent history
50% Gas
75% Gas
100% Gas
of natural gas development and market conditions,
it is highly speculative to estimate natural
gas prices 10 years from now, let alone 20.
Therefore, several economic sensitivity cases
were run to examine different levels of natural
gas price escalation, ranging from 2.95% (the
baseline assumption) to 10%. In addition, a
special case that assumed 0% coal price escalation
was compared with these cases (Figure
7). We can conclude that the 100% gas case
is actually the cheapest alternative for meeting
emissions requirements until the gas price
SCR only
Sorbent injection + SNCR
escalation exceeds 5% to 6%.
The effect of varying gas cofiring strategies
versus varying capital cost scenarios was
also compared to evaluate the economic risk
should the regulatory requirement be less than
assumed. Figure 8 shows that any time the
FGD system is required, 100% gas conversion
is the least-cost alternative. The study also
found that the sorbent injection plus an SNCR
option is cheaper than the 100% gas case.
Each power station occupies a unique economic,
emissions, and performance position
within a utility's coal fleet. No one solution is
appropriate for every plant. However, many utilities
can benefit from increased fuel flexibility
and improved unit reliability by implementing
natural gas cofiring. Natural gas cofiring allows
a utility to maintain a unit's capability to burn
100% coal while providing a hedge against rising
coal prices and the rising cost of complying
with new air emissions regulations. ■
-Una Nowling (nowlinguc@bv.com)
is a project manager and technology
lead for fuels at Black & Veatch. She
has worked on fuels-related issues and
analyses at more than 550 different units
over 20 years, specializing in coal, natural
gas, and biofuels. She is also an adjunct
professor of mechanical engineering at
University of Missouri-Kansas City.
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56
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POWER | October 2013
Busbar cost (mill/kWh)
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POWER October 2013

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