How Did Coal Become an Alternative Energy Source
The New York Times has a story on new techniques for converting coal into energy. Although we wonder how coal, which has been used for centuries, became an alternative energy source all of a sudden the search for new uses for coal benefits two of our Watch List companies - Sasol (SSL) is mentioned in the article as having been converting coal into fuel oil for decades and Headwaters (HW) develops catalyst technologies to convert coal and heavy oil into liquid fuels.
The article points out that coal reserves in the US are far greater (in terms of potential energy) than the oil reserves in Saudi Arabia. Given the enormous global demand for energy as China and India rapidly move into the developed world, in the short term any available energy sources are likely to be sought just to keep the lights on. However, the article notes coal’s dark side:
Producing fuels from coal generates far more carbon dioxide, which contributes to global warming, than producing vehicle fuel from oil or using ordinary natural gas. And the projects now moving forward have no incentive to capture carbon dioxide beyond the limited amount that they can sell for industrial use….
Unless the factory captures the carbon dioxide created during the process of turning coal into diesel fuel, the global warming impact of driving a mile would double.
We have written a number of times on emerging solar technologies that will hopefully be cost-competitive within a few years. If they do, carbon dioxide worries would likely quickly become a thing of the past. It is quite possible that the companies hoping to exploit coal and oil will need to make their hay while (or before, in this case) the sun shines. Meanwhile, the process of converting coal allows companies to use high-sulfur coal rather than the low-sulfur variety, which vastly broadens the potential energy stockpile.
The coal will come from southern Illinois, by barge or rail. The diesel can go straight to terminals or truckstops in the area, said Mr. Diesch, the plant manager, and the fertilizer to local farms. An odd advantage is that today, most coal-burning power plants in the area use coal hauled from Wyoming, because its sulfur content is lower; burning high-sulfur coal encourages acid rain. But if the coal is gasified, rather than burned, filtering out the sulfur is relatively easy, and the sulfur changes from a pollutant to a salable product.
So the environmental impact is a mixed bag - more carbon dioxide, less sulfur. And, as befits a market economy there are those who would turn the pollutant into cash.
Like this article? Why not try out:GreatPoint has a different plan: move the plant where it can sell the carbon.
Andrew Perlman, the company’s chief executive, thinks it has value. “Not only is it capturable, one of biggest advantages of the system is, we can locate our plant near a natural gas pipeline, in places where we can sell that carbon dioxide for a profit, using existing technology,” he said. Oil producers inject carbon dioxide into old oil fields, to force oil to the surface.
