Water Needs Curtail China’s Coal Gasification to Fuel Program, But Conversion To Chemicals Pushes Ahead

In a desert province in western China, there are six massive coal-conversion plants putting strains on the region’s water supply.

Originally posted on the CSRwire website.

By Keith Schneider, Circle of Blue

When it was approved in 2003, the Shenhua Group's $US 4 billion refinery was seen as the vanguard of the world's largest program for converting coal to new products such as chemicals, fertilizers and fuel. Shenhua's engineers had cracked an old industrial code - managing to turn 100-year-old chemistry on its head - and produced what looked to be a big national payoff.

By pulverizing coal to dust, mixing it with water and heating it to form a gas in state-of-the-art industrial plants, Shenhua and China’s other big, state-owned energy companies could use the nation’s mammoth coal reserves to produce diesel fuel. That, in turn, could slow China’s expanding demand for petroleum, which last year reached 3.6 billion barrels - 52 percent of it imported - nearly double the 2005 demand.

China’s central government energy and economic development agencies were so enthused they approved plans to build 22 more coal-to-liquid fuel plants, most of them to be constructed close to the largest reserves of coal in the country’s dry northern and western provinces.

In the Ningxia Hui Autonomous Region, a desert province west of Ordos and along the Yellow River, there are six coal-conversion plants that each year use 4.4 million metric tons of coal to produce 1.62 million metric tons of ammonia and 2.3 million metric tons of urea. Photo: © Aaron Jaffe/Circle of Blue

Code For Water Savings Not Cracked

But Shenhua’s engineers weren’t able to crack the other part of the code; the part that deals with water consumption.

In the latest chapter of its Choke Point: China series, Circle of Blue reports this week on Shenhua’s coal-to-liquids plant, an example of China’s increasingly dire confrontation between rising energy demand and diminishing freshwater reserves. In almost every way imaginable, the expectations that heralded the construction of the Shenhua plant - followed by the change in national direction that greeted its opening - describe the exceptionally risky path China is pursuing to diversify how it uses the nation’s huge coal reserves.

Every step of the coal mining, processing, shipping, combustion and gasification requires huge amounts of water, and produces the world’s largest emissions of climate changing gases. Though China is pursuing aggressive programs to improve energy efficiency, undertaking experimental programs in carbon capture and storage, investing in water-sipping and pollution-free renewable energy development, and water recycling and conservation, its production and consumption of coal is soaring.

The swift increase in coal production, though, shows no sign of abating, in part because of the country’s massive coal conversion industry. Roughly 460 million metric tons of coal last year was pulverized to a powder, mixed with water, heated and gasified for conversion to chemicals, fertilizers and fuel.

"It makes sense to produce chemicals from coal," said S.Ming Sung, a former utility industry engineer who is a representative in China for the Clean Air Task Force, an environmental organization based in the U.S. “As life here improves, we need more synthetic chemicals. More than 80 percent of the solid matter is hydrogen and carbon. In the U.S. and Europe, those come from oil and natural gas. China, though, has very little oil and very little natural gas. So we use coal.”

Follow the full Choke Point: China reporting here: http://www.circleofblue.org/waternews/featured-water-stories/choke-point-china/.

About Keith Schneider

As Senior Editor, Keith manages the Circle of Blue news desk and participates in multimedia story development reporting, editing and production. He is a nationally-known journalist, online communications specialist and environmental policy expert. Keith was a New York Times national correspondent for over a decade, where he continues to report as a special writer on energy, real estate, business and technology. Before joining Circle of Blue, Keith was media and communications director at the US Climate Action Network and communications director at the Apollo Alliance. Keith developed one of the first independent online news desks as the founder and executive director of the Michigan Land Use Institute. A sought-after public speaker on the role of original reporting and online communications in the public interest, Keith is a regular contributor to the Times, Yale Environment 360, Grist Magazine and other prominent news organizations. You can read his personal website at Modeshift.org.

Talkback Readers: It’s a water- and pollution-weighted equation: coal to gas. What alternative energy solutions can you suggest that would require less water and be more sustainable? Share on Talkback!

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