IGCC MAY BE KEY TO MAKING COAL AN ECONOMIC FUEL OF CHOICE
Integrated gasification combined-cycle (IGCC) (or coal gasification) may be the key to coal's long-term survival as an economic and environmentally practical fuel. As the natural gas price path becomes more uncertain, the capital costs of new coal-fired boilers with the full range of environmental controls are starting to converge with the declining costs of IGCC, making coal more competitive. IGCC can also offer flexibility in using the derived synthesis gas (carbon monoxide and hydrogen) to produce not only power but potentially steam, fuels, and a wide range of chemicals. Ultimately, IGCC also could be a provider of hydrogen and hence serve as a bridge to the hydrogen economy. CERA notes the following key observations:
- Investing in coal today is a long-term bet on a changing environmental future-one that is better addressed by IGCC than conventional boiler technology.
- IGCC's polygeneration options fit well with emerging concepts of "industrial ecology" whereby waste streams are recovered to extract economic value.
- Future natural gas prices will be a major catalyst for increasing fuel diversity, especially coal.
- A new IGCC facility could demonstrate to investors the increasing confidence in new IGCC plant costs and in improved reliability.
