. "Appendix F: Case Studies for the Fossil Energy Program." Energy Research at DOE: Was It Worth It? Energy Efficiency and Fossil Energy Research 1978 to 2000. Washington, DC: The National Academies Press, 2001.
Developed a variety of concepts to remove contaminants from finely ground coal
aUnless otherwise noted, all dollar estimates are given in constant 1999 dollars through 2000.
bFE provided no information on industry costs or cost share; however, private industry interest in this technology was minimal.
cSince coal cleaning and beneficiation add to the cost of pulverized coal supplies, there is no current economic benefit to the application of the technologies. FE provided no discussion or estimates of economic benefits.
dIf conventional coal use is reduced owing to real or perceived environmental, health, or other concerns, then demand for the traditional coal products would also be expected to decrease; at the same time, the demand for deeply cleaned coal with very low ash, sulfur, and trace element content using advanced technologies developed via coal preparation R&D might increase.
This program is another good example of a technology option that has lost its motivation because of shifting environmental requirements and fuel preferences guided by changing energy policy. The program has a history of 22 years or more in DOE with productivity in technology development. At the beginning it was aimed at environmental protection by improving the quality of coal and the precombustion removal of undesirable constituents of coal for sequestration as solid waste. This approach was one favored option for retaining Eastern coals as a fuel option in the early stages of pollution control. However, there has been little or no motivation to wash low-sulfur Western coals. Air quality requirements and the switching of electricity generation to low-sulfur, low-cost coals and natural gas made this approach obsolete by the late 1980s.
Given the changes occurring in the electricity generation industry with the advent of natural-gas-fired gas turbine designs and IGCC applications for future coal options, combined with deregulation of the electricity industry, FE has moved this program to a low priority. At the same time, there remains industry support to press on with some basic R&D effort in this area so as to continue developing a reservoir of knowledge about coal beneficiation. The lack of commercial interest in technologies in the coal sector indicates that the market for the foreseeable future will not be amenable to adding costs to coal supplies. While the spin-offs from separation technologies have found commercial application in the other industries, they do not warrant according this area a high priority.
DIRECT COAL LIQUEFACTION
Program Description and History
The DOE direct liquefaction program in the 1970s and early 1980s consisted primarily of large-scale demonstration projects with broad industry participation in response to the energy crisis perceived at that time. Since U.S. coal reserves are huge and coal prices were judged likely to remain relatively modest, the DOE and participants from the electric power and oil industries set out to demonstrate the best-available technology for directly converting coal to liquid fuels. A smaller-scale, more fundamental R&D process improvement program with less industry participation followed these demonstrations through most of the 1980s and the 1990s. After a series of budget reductions, the direct liquefaction R&D program was eliminated in 2000. Over 88 percent of the expenditures in direct coal liquefaction since 1978 occurred prior to 1983. This pattern is generally consistent with the rise and fall of projected crude oil prices and with the change in the administration’s view of government energy R&D following the elections in 1980.
This case study is based on information provided by DOE to the committee in a meeting held June 21, 2000, and in a more detailed written response by DOE to committee questions transmitted on January 18, 2001, as well as technical and economic information contained in the NRC report Fuels to Drive Our Future (NRC, 1990).
In the direct liquefaction technology pursued by the DOE and industry participants, hydrogen is added to coal in solvent slurry at elevated temperatures and pressures. This gen-