THE FUTURE OF COAL:

EXISTING POWER STATIONS

CONSIDERATIONS FOR NEW STATIONS

Brett Cohen

sti!s Power Sector Workshop

5 March 2013

EXISTING POWER STATION FLEET

Power station Net maximum capacity (MW)

Nominal capacity (MW)

Arnot 2,232 2,352

Camden 1,450 1,530

Duvha 3,450 3,600

Grootvlei 380 (1,090) 400 (1,150)

Hendrina 1,865 1,965

Kendal 3,840 4,116

Komati 170 (878) 182 (940)

Kriel 2,850 3,000

Lethabo 3,558 3,708

Majuba 3,843 4,110

Matimba 3,690 3,990

Matla 3,450 3,600

Tutuka 3,510 3,654

Medupi 0 (4,332) 0 (4,618)

Kusile 0 (4,338) 0 (4,680)

POWER STATION COAL REQUIREMENTS Power station CV Range

Arnot

22 – 24 MJ/kg Camden

Tutuka (on the border)

Kriel

20 – 22 MJ/kg

Duvha

Grootvlei

Hendrina

Komati

Majuba

Matla

Kendal

18 – 20 MJ/kg

Matimba

Medupi

Kusile

Lethabo 16 – 18 MJ/kg

LATE DECOMMISSIONING – 23,283 MW BY 2040

-6000

-5000

-4000

-3000

-2000

-1000

0

1000

2000

3000

MW

Arnot Camden Duvha Grootvlei Hendrina Kendal Komati Kriel

Lethabo Majuba Matimba Matla Tutuka Medupi Kusile

6,868 MW: Camden

Komati

Grootvlei

Matla

3,450 MW: Duvha

12,965 MW: Arnot

Hendrina

Kriel

Lethabo

Matimba Tutuka

MID-DECOMMISSIONING – 28,023 MW BY 2040

-6000

-5000

-4000

-3000

-2000

-1000

0

1000

2000

3000

MW

Arnot Camden Duvha Grootvlei Hendrina Kendal Komati Kriel

Lethabo Majuba Matimba Matla Tutuka Medupi Kusile

6,868 MW: Camden

Komati

Grootvlei

Matla

3,450 MW: Duvha

4,097 MW: Arnot

Hendrina

13,068 MW: Kriel

Lethabo

Matimba

Tutuka

EARLY DECOMMISSIONING – 32,028 MW BY 2040

-6000

-5000

-4000

-3000

-2000

-1000

0

1000

2000

3000

MW

Arnot Camden Duvha Grootvlei Hendrina Kendal Komati Kriel

Lethabo Majuba Matimba Matla Tutuka Medupi Kusile

6,868 MW: Camden

Komati

Grootvlei

Matla

3,450 MW: Duvha

4,097 MW: Arnot

Hendrina

17,448 MW: Kendal

Kriel

Lethabo

Matimba

Tutuka

SUMMARY: LIFE OF COAL FIRED POWER

STATIONS

! " Decommissioned under IRP: Camden, Komati, Grootvlei, Matla and Duvha

! " Partly or fully decommissioned between 2030 and 2040 :

Hendrina, Arnot, Tutuka, Lethabo, Kriel, Matimba and Kendal

! " Still fully operational in 2040: Majuba, Medupi and Kusile

COAL FOR EXISTING POWER STATIONS

! " Power stations historically supplied via long-

term contracts

! " Mines nearing end of lives – new coal needs to be sourced, to extend power station lives

! " Eskom estimates:

•" 2,000 Mt total coal required from new

mines now to 2050

•" 300 to 800 Mt threatened by exports:

›" Supply in 22-24 MJ/kg band (Arnot,

Camden and Tutuka) competes with exports (RB3 grade)

•" 80 Mt/a required from new mines

COAL FOR EXISTING POWER STATIONS

! " Sufficient coal in the Central Basin to 2040

•" Some big blocks earmarked for export – could swing availability for Eskom in Central Basin

! " Alternative to build rail line to obtain coal from Waterberg

•" Allow for continued exports

! " Potential challenges post 2040 for remaining power stations

! " Mine investment remains a big problem

•" Lack of investment appetite from large mining houses

! " Other options for coal supply:

•" Discards

•" Re-mining pillars

OPTIONS FOR NEW COAL POWER STATIONS?

! " Waterberg:

•" New PF stations

•" FBC

! " Challenges:

•" Low grade/yields

›" Costly to wash

›" Difficult to mine

•" Dual product mines suggested to be more profitable

›" Requires rail infrastructure for exports

•" Water availability

OPTIONS FOR NEW COAL POWER STATIONS?

! Fluidised bed combustion of discards/fines in Central Basin

•" Large volumes of limestone sorbent

•" Transport and CO2 impacts

! " One new 6-pack in Central Basin?

! " Location at the coast:

•" Closer to CCS injection sites

•" Rail coal instead of transporting water and CO2

TECHNOLOGY CHOICE ! " Ultra-supercritical plants

•" Significant efficiency gains (~47%)

•" Reduced CO2/kWh

! " UCG

•" Could unlock some seams not suitable for mining

•" Not before mid-2020s

! " IGCC

•" Efficiencies > 50%

Chapter 5 - Power and renewables outlook 181

5

Figure 5.4 ! Incremental global coal-fired electricity generation relativeto 2009 by region in the New Policies Scenario

-1 000

0

1 000

2 000

3 000

4 000

5 000

2015 2020 2025 2030 2035

TWh Other non-OECD

India

China

OECD

In the New Policies Scenario, the mix of coal-fired generation technologies changes overthe Outlook period as older plants are retired and more efficient new plants are built,including ultra-supercritical designs and integrated gasification combined-cycle (IGCC) plants(Figure 5.5).1 Increases in the price of coal, reductions in the capital costs of advanced coaltechnologies and the introduction of carbon prices all contribute to the shift towards higher-efficiency coal plants. As a result, the average global thermal efficiency of coal plants increasesby four percentage points, from38% in 2009 to 42% in 2035. Thesemore efficient technologiesentail higher capital costs than the subcritical and supercritical plant designs that make upmost of the current fleet of coal-fired plants, but they use less fuel and, therefore, emit lessCO2 and other emissions for each unit of electricity they generate. Lower fuel use due to higherefficiency plants also helps tomoderate import dependence for importing countries.

Figure 5.5 ! World coal-fired electricity generation by plant type in the NewPolicies Scenario

0

2 000

4 000

6 000

8 000

10 000

12 000

2009 2015 20252020 2030 2035

TWh Coal-fired CHP

plants

Coal plants fi!edwith CCS

Advanced coalplants*

Supercri"cal plants

Subcri"cal plants

*Advanced coal plants include ultra-supercritical and IGCC plants.

1. See Chapter 10 for a detailed discussion of coal-!red genera!on technologies.

© O

EC

D/I

EA

, 2

01

1Source: WEO 2011

COAL AND CCS: CHALLENGES

! " Availability of capture sites

! " Cost implications

! " Legal/regulatory/risk

! " High water penalties

! " Possible retrofit only on Medupi and Kusile

! " 85% carbon is sequestered

! " Net thermal efficiency penalty ~ 9.6%

•" Results in significant additional coal requirements and infrastructure build

SUMMARY

! " Existing power stations run to 2030, thereafter rapid

decommissioning

•" Coal supply remains a challenge particularly 22-24 MJ/kg

•" Need investment in new mines if existing power stations

continue to operate

! " New coal fired power station options:

•" Waterberg, Central Basin

•" Technology choices – post 2030

›" Potential for greater efficiency and reduced CO2

! " CCS comes with major challenges

THANK YOU

www.tgh.co.za | brett@tgh.co.za

Tel: +27 (0) 21 671 2161 | Fax: 086 638 3692

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