Laura Miller - CCS Projects – Presentation at the Global CCS Institute Members’ Meeting: 2011


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Laura Miller - CCS Projects – Presentation at the Global CCS Institute Members’ Meeting: 2011

  1. 1. Texas Clean Energy Project: A PolyGen Facility with 90% CO2 Capture Global CCS Institute 2011 Members’ Meeting Melbourne, Australia October 4, 2011SUMMIT POWER
  2. 2. Summit Power GroupOverviewSPG’s traditional business is Power Project Development • Track record of successfully leading development of large, clean energy projects—over 7,000 MW in operation Previous SPG • Over 1,000 MW in development or Power Projects under construction • Total SPG-led projects in service or under contract, including O&M agreements represent over $7 billion of investment • Successfully launched joint venture to develop utility-scale solar projects2 SUMMIT POWER
  3. 3. Summit Power Group OverviewSPG was founded twenty years ago by Donald Hodel & Earl Gjelde – Mr. Hodel was Secretary of Energy (& later Interior) under President Reagan – Mr. Gjelde was Mr. Hodel’s #2 in both Cabinet positions – Messrs. Hodel & Gjelde previously led Bonneville Power Administration (BPA) – Now includes several dozen experienced power sector professionalsCurrent principal business lines – Wind power (creator of the widely utilized ―White Creek Model‖) – Solar power (utility-scale PV projects in JV with REC and CSP projects with Starwood Global) – Natural gas-fired power plants (principally Siemens CCGTs technology) – Gasification with carbon capture (TCEP & others, plus Underground Coal Gasification) – Commercialization of select new clean energy technologiesFocus on clean, low- or no-carbon projects that support U.S. energy security 3 SUMMIT POWER
  4. 4. Snapshot of TCEP• 400 MW IGCC project with 90% carbon capture• Siemens gasifiers & 1x1 F-class CCCT w/ high H2 CT• Linde chemical block incorporates Rectisol CO2 capture process• Located at former FutureGen site directly atop Permian Basin• All components already in commercial use elsewhere; only the integration is new; intended as a reference plant• 90% carbon capture rate yields ≈ 3M short tpy of CO2• $450 million cost share from CCPI3
  5. 5. Project Overview• Total Capital Cost ~ $2.2 Billion• Three year construction schedule – average 1,500 jobs• Annual operating expenses ~ $85 million – 150 permanent jobs• Approximately 3 million tons/yr of CO2 = 9 million bbls of oil• Powder River Basin Coal ~ 2 million tons per year• Natural Gas for Startup and Back up• Some turndown capability from duct burners
  6. 6. TCEP Site
  7. 7. TCEP is #1 projectfor climate & CCS• TCEP is Administration’s #1 project for carbon capture and sequestration (CCS) – most funding of any project• Ardent support from national environmental groups – NRDC, EDF, Clean Air Task Force• Received Record of Decision, thru National Environmental Policy Act, on 9/27/11• Received air permit 12/28/10 without opposition, in record time• The US project chosen for CCS collaboration with China
  8. 8. Project Background• DOE had selected TCEP on 12/4/2009 for $350M award in Round 3 of the Clean Coal Power Initiative (CCPI-3)• 1/29/2010 – DOE and Summit sign the Cooperative Agreement (first U.S. government contract in Summit’s twenty-year history)• 6/2010 – DOE awards TCEP $100 million more in CCPI funds and indicates that TCEP will be a U.S. project for U.S. – China collaboration on carbon capture & sequestration (CCS)
  9. 9. Things began to rollFebruary 2010• FEED Study contractor negotiations begin; this becomes a competitive process among “A Team” firms & companies• Negotiations begin for sale of TCEP’s main products & for water supplies• Environmental permitting work beginsMarch 2010• Summit Texas Clean Energy, LLC (the project company) acquires the project site with Odessa Development Corp grantApril 2010• Air permit application filed• IRS awards TCEP a Section 48A investment tax credit of $313,436,000.00
  10. 10. And roll . . .May 2010• Decision to bring more detailed engineering into Phase 1 from Phase 2, requiring more non-Federal funds for Phase 1June 2010• FEED Study contractors selected: Siemens, Linde, Fluor• FEED study commences• Added Phase 1 non-Federal funds successfully raisedSummer 2010• Paperwork, systems, and audit complete, DOE commences cost reimbursements for TCEPDecember 2010• TCEQ issues final air permit for TCEP without opposition
  11. 11. Where things stand• Final EIS Record of Decision (ROD) issued 9/27/2011• FEED Study complete end of July 2011• EPC contract negotiations underway • Linde (chemical block), Siemens (power block), 3rd Company (balance of plant & integration) • Scheduled for completion end of October • All three EPC contractors have financial “skin in the game”• Water & coal supplies: Multiple options, all in active discussion• Rail transport: Good cooperation to date from Union Pacific• Last Stages of Transmission Interconnect Agreement
  12. 12. Estimated Schedule• FEED Completion - July 2011• Complete contracts – October 2011• Financial Close – December 2011• Start of Construction – Early 2012• Mechanical Completion – December 31, 2014• Commercial Operation Date – First half 2015
  13. 13. Product sales• TCEP is a “polygen” IGCC project – it has multiple products• Three major products account for 95% of revenue: • Power: ~195 MW at busbar, large on-site commercial loads; negotiating PPA with CPS Energy • Urea for fertilizer: up to 750,000 tons per year (~20% of US production); 100% urea sold to major urea distributor • CO2 for EOR: Approximately 147,000 Mcf per day; 60% of CO2 sold to Whiting Oil• Minor products: Argon gas, sulfuric acid, inert non-leachable slag• Thanks to DOE financial support, all products can be sold at “market” rather than at “cost” – which would be hard to calculate in any event
  14. 14. Diversified Revenue Stream Bankable Offtake Contracts • 400 MW gross output Revenue • 195 MW net to grid 30 year, PV10 Power • ERCOT peak demand >65,000 MWs CO2 • 3 MM tons/year 21% Power 30% CO2 • 90% capture rate Argon • 33 MM tons annual demand Urea & 46% • 750k tons/year minor Urea • US demand 8.5 MM tons/year 3% • US imports 5 MM tons/year SUMMIT POWER 15
  15. 15. Water Requirements• Minimize water usage – Dry cooling for power block – Zero liquid discharge – Recycle – Deep Well Injection• Current estimated average demand ~ 4 MGD• Current estimated peak demand ~ 4.8 MGD 16
  16. 16. Water Supply & Challenges• Fresh Ground Water – On-site wells – Fort Stockton Holdings – Other• Brackish Ground Water – Capitan Reef• Municipal Waste Water – Gulf Coast Waste Disposal Authority • City of Midland • City of Odessa 17
  17. 17. Low Air Emissions • Texas Commission on Environmental Quality (TCEQ) issued final air quality permit for TCEP on Dec. 28, 2010; draft permit had no environmental opposition or requests for hearing • NOx, SOx & PM far below lowest-yet limits permitted in Texas for fossil fuel power plants • Sulfur removal is 99% despite using low sulfur coal • Mercury removal greater than 95% from syngas • CO2 capture rate of 90% - CO2 emissions rate (lbs per MWhr) only 20 to 30% of a natural gas combined-cycle power plant 18
  18. 18. SO2, NOx, PM10 Bar Chart 19
  19. 19. CO2 Bar Chart 20
  20. 20. Texas Emissions Comparisons Power Plant Emission Summary - Per MW Comparison WITHDRWN 2014 1979 2010 - 2014 Morgan Tenaska 2014 Martin Lake Oak Grove Creek Trailblazer Las Brisas White Stalion TCEP (2565 MW) (1720 MW) (858 MW) (765 MW) (1320 MW) (1320 MW) (400 MW)SO2 (lb/MW) 11.97 2.01 1.01 0.65 1.40 0.86 0.14NOx (lb/MW) 4.49 0.84 0.50 0.55 0.66 0.70 0.13PM10 (lb/MW) 1.00 0.42 0.40 0.35 0.29 0.26 0.22Hg (lb/MW) 0.000214 0.000096 0.000021 0.000019 0.000019 0.000008 0.000007CO2 (lb/MW) 2,203 2,203 2,129 319 1,972 2,041 2281. EPA has determined that permit limits for CO2 will be required January 2, 2011.2. Tenaska CO2 emissions are scaled from Morgan Creek and assume 85% capture.3. Martin Lake CO2 emissions are scaled from Oak Grove.4. TCEP PM10 emissions are 0.08 lb/MW without coal drying and urea production emissions. 21 SUMMIT POWER
  21. 21. CO2 Management • Blue Source will manage most CO2 matters – Sale of CO2 for EOR, arranging pipeline transport, and certification of verifiable emissions reduction (VER) credits • TX Bureau of Econ Geology will approve the MVA – New state law contains comprehensive requirements for MVA (monitoring, verification and accounting of CO2) – Texas has the most progressive clean coal policies in U.S.; could be model for the nation • Carbon Management Advisory Board will be created – CCS scientists, policy-makers, environmentalists – To advise re: capture, sequestration, MVA, policy, etc. 22
  22. 22. CO2/EOR = CCS + a bridge Photo by Briley Mitchell • CO2/EOR has long, safe, reliable, high-volume history – Especially in Permian Basin, this is not an experiment • CO2/EOR with MVA can be highly reliable form of CCS – CO2 can remain sequestered for more than 1,000 yrs (the TX std) 23
  23. 23. CCS in the Permian Basin •CO2 pipelines network with several major owners •The natural sources are in decline, and the one huge natural dome (McElmo Dome) that does have additional supplies would require billions in pipeline cost to transport Map illustrates the CO2 pipelines throughout the US SUMMIT POWER 24
  24. 24. Plant Rendering AV20100391 25
  25. 25. 3D Rendering of TCEP Plant Power Block AV20100391 26
  26. 26. Plot Plan 27
  27. 27. Block Flow Diagram 28
  28. 28. TCEP Core 29
  29. 29. ConclusionTCEP is a ―poly-gen‖ power and chemicalfacility based on gasification of coal. Verydifferent from most IGCCs in four respects: One of the world’s largest CO2 capture projects (90% capture rate) CO2 as major revenue source – not cost Dual use of syngas (power & fertilizer) Warranties on integrated performance This makes TCEP unusual 30
  30. 30. Lessons Learned Technical decisions drive the commercial decisions Commercial decisions drive technical decisions Location provides opportunities EOR is an increasingly important bridge for CCS Polygens (versus power-only) are critical to private financing Bipartisan support is key Community support (state and local) is key Again, this makes TCEP quite unusual 31
  31. 31. Contact information• Laura Miller: – – (214)763-0600• See also: – – 32