Petrol and diesel prices are high, and oil import bills are increasing, and we need lots more electric power. Much discussion on the diesel/petrol subsidy, prices and taxes. What can we do to solve this?
Constraint = Assume oil cannot be replaced with anything else (in the short/medium run, it is hardwired into our economy)
Solution = use existing technology and methods to create a ceiling price for fuel oils near ~ $35 per barrel (a Fischer Tropsch synthesis cost).
Actions =
- India oil consumption is ~ 3 million barrels/day (159 liters/barrel) http://www.nationmaster.com/graph/ene_oil_con-energy-oil-consumption, http://www.eia.gov/countries/cab.cfm?fips=IN
- Oil source is 30% in-house (ONGC & Oil India) and 70% imports (say 2.1 million bbl/day)
- Oil is 24% of Indian energy use http://www.eia.gov/countries/cab.cfm?fips=IN
- Current oil price is ~ $94/ barrel
- We have 5.6 billion barrels of oil reserves http://www.eia.gov/countries/cab.cfm?fips=IN
- Cost of oil produced by ONGC is ~ $37/barrel, Oil India $28 http://profit.ndtv.com/news/show/ongc-s-crude-production-cost-at-37-29-bbl-in-fy11-oil-minister-168335
- Coal is 41% of Indian energy use, 617 billion-kg/year
- Electricity is >70% generated by coal (say 70% of 800 TeraWh)
- We can liquefy coal to make oil (Fischer Tropsch synthesis). Cost is ~ $35 per barrel (refs: https://en.wikipedia.org/wiki/Synthetic_fuel, https://www.iol.co.za/business-report/economy/sasol-eyes-6bn-second-secunda-725264, http://energywv.org/assets/files/Energy-Summit-Presentations/2014/26_Burt_Davis.pdf page 61).
Constraint = Assume oil cannot be replaced with anything else (in the short/medium run, it is hardwired into our economy)
Solution = use existing technology and methods to create a ceiling price for fuel oils near ~ $35 per barrel (a Fischer Tropsch synthesis cost).
Actions =
- Displace coal use = Place orders on a massive scale for nuclear power plants that replace thermal power plants. Cost of the nuclear plants is amortized into the electricity price, profitable investment with current price-per-KWh (our great nation-state can make the big bet via govt. guarantees) ref http://www.nei.org/keyissues/reliableandaffordableenergy/economicgrowth/
- Use the displaced coal to displace oil imports = Place orders for coal liquefaction plants to make oil. Cost of the coal liquefaction plants is amortized into the $35/bbl price, profitable investment with current oil-price forecast (our great nation-state can make the big bet via govt. guarantees)
- Scale these to be sufficient to replace all future oil imports. Say 100 GW nuclear capacity will cost us US$ 400 billion to eliminate an oil import bill of $76 billion/year + profit from electric power generation (1 rupee/kWh cheaper) + effects of oil price reduction + clean energy + lower price/kWh for energy + scale energy … ref 2G scam of Rs1.76LCr was $35b.
- Oil price in the future (5-6 years for build-out) will crash
- Oil price in the present will trend down as the market factors-in the investments
- Converting coal power-plants into integrated nuke&synthoil plants should drastically reduce the pollution generated by these plants. Railway lines bringing in coal can be used to bring in coal and ship out oil. Transmission lines are in place and can be beefed up as generation increases.
- Scalable solution to electricity generation capacity shortage.
Data from NPCIL Chairman's Statement in the AGM on August 2014 means that the average cost of nuclear electricity generated by NPCIL in 2014 was Rs. 2.93/kWh (30896 Million KWh for Rs. 9,053 crore, ref http://www.npcil.nic.in/pdf/CMD_Statement_2014.pdf). Compare this to electric power generated by the NTPC from coal at Rs. 3.05/unit (ref page 24 of the NTPC Investor presentation in August 2014, http://www.ntpc.co.in/presentations/1191/presentation-10th-analysts-investors-meet-held-mumbai-07082014)
ReplyDelete"The net export of electricity during the FY 2013-14 is 30896 Million KWh as against 29541 Million KWh during the previous FY 2012-13, i.e. an increase of 4.59 percent. Capacity factor increased to 83.49% during the FY 2013-14 as compared to 80.06% during FY 2012-13.
The total income during the FY 2013-14 is Rs. 9,053 crore which is 4.8% higher compared to Rs. 8,638 crore during the FY 2012-13. The Company earned a profit after tax of Rs. 2299 crore during FY 2013-14 as compared to Rs. 2101 crore for the previous FY 2012-13, with an increase of 9.42%. The increase in profit is mainly due to higher capacity utilization, resulting in increased generation of electricity and decrease in finance costs."
Power from the Kudankulam plant is expected to cost Rs. 4.29/unit (ref http://timesofindia.indiatimes.com/city/chennai/Kudankulam-power-to-cost-4-29/unit/articleshow/45712143.cms).
Coal-to-Liquid Fuels links
ReplyDeletehttps://www.iea.org/ciab/papers/workshopreport_nov06.pdf
http://worldctx.com/documentation/coal-to-liquid-fuels/
http://www.iea-coal.org.uk/documents/82184/7171/Review-of-worldwide-coal-to-liquids-R,-D&D-activities-and-the-need-for-further-initiatives-within-Europe -- "In 2006, the IEA noted that for CTL to be competitive, a plant would need to have access to coal at less than 20 US$/t (IEA 2006). Although this is less than half of the current international price, over 80% of the world’s coal is not internationally traded, and at least 30–40% of the world’s coal is mined for less than 20 $/t - including most low rank coals. On that basis, at a steam coal price of 20 US$/t, CTL can be competitive with a crude oil price of under 40 US$/bbl, and the average production cost of synfuels would be about 50 $/bbl. There will be economies and cost reductions associated with the building of a series of CTL plants as operational experience is gained and the initial designs are copied and refined."
Coal India considers tie up with Sasol for CTL project
ReplyDelete20 September, 2016
http://www.business-standard.com/article/companies/coal-india-considers-tie-up-with-sasol-for-ctl-project-116092001022_1.html
Coal India (CIL) plans to invest Rs 10,000-12,000 crore over the next three to four years in producing hydrocarbons from coal. The state-owned firm is likely to tie up with Sasol of South Africa, a leader in coal to liquid (CTL) technology.
To begin with, CIL plans to use around 10 million tonne (mt) of coal to make products that can be used as substitutes for petroleum.
This is not the first time CIL has looked at tying up with Sasol. Ten years back, a high-level delegation from Sasol visited India to hold discussions with CIL for a project to produce synthetic fuel from coal.
The US Department of Energy on converting coal power plants to nuclear power plants
ReplyDeletehttps://www.energy.gov/ne/articles/could-nations-coal-plant-sites-help-drive-clean-energy-transition
DOE Report Finds Hundreds of Retiring Coal Plant Sites Could Convert to Nuclear
ReplyDeletehttps://www.energy.gov/ne/articles/doe-report-finds-hundreds-retiring-coal-plant-sites-could-convert-nuclear