According to reports, in May 2008, an agreement was signed between India’s biggest power equipment manufacturer, the public sector BHEL, and the power utility of Andhra Pradesh, APGENCO. Under it, BHEL would supply equipment for a 125 MW thermal power plant that APGENCO would own and run. When Business Line checked last month, there had been zero progress on the project in the last five years.
At a time when most power projects are stuck, the lack of progress on a small, 125 MW-plant might seem unworthy of note. But then, this was a very special project. This was to be the country’s first commercial scale, coal-fired project based on a clean coal technology called ‘Integrated Gasification Combined Cycle’, or IGCC.
It was, therefore, a big deal and generated appropriate publicity at that time. Its significance lay in the fact that India needs to master a clean coal technology for its own coals, which are unique, and the project would pave the way for it.
Everybody knows that coal is India’s biggest energy resource. We have 293 billion tonnes of the fuel under our soil, while we annually need about 500 million tonnes. Coal is polluting. Nevertheless, we have to use coal, for it is silly to ignore what we have and go after what we don’t.
IGCC is a way of using coal in a manner that does not pollute. The science behind it is simple enough. You gasify coal and put the gas into gas turbines. Two advantages.
First, you separate the pollutants when you gasify, which are harmful if burnt and let into the atmosphere. Second, and more significant, the efficiency of gas turbines is higher, which means you extract more energy out of the same resource.
Using IGCC, you could extract about half the energy contained in the coal — better than a good thermal power boiler’s best of around 44 per cent. The difference is commercially significant.
And so the BHEL-APGENCO deal was lauded for its pioneering nature and it was then thought it would mark the beginning of a new chapter in India’s energy history.
But in the last five years there has been absolutely no progress. Reason? Since IGCC is costly, Government of India had agreed to chip in with Rs 300 crore for the venture. That has not come so far. APGENCO is still waiting for it.
We Indians are used to buying technology from abroad, but when it comes to coal, we have no option but to develop our own, because our coals are very unique. They are of ‘high ash content’— about 40 per cent of it either does not burn or is useless (or harmful) when burnt.
You depend upon foreigners for technology for Indian coals, you are in trouble — as illustrated by the case of BHEL supplying equipment based on another clean coal technology, (called ‘circulating fluidised bed combustion’) to another public sector power utility, Neyveli Lignite Corporation.
The project has taken twice the time it was scheduled to but is still to be commissioned — which has caused a lot of heartburn between the two organisations, apart from not generating the much-needed electricity. BHEL’s officials say they are now teaching, not learning from, their technology partners, Lurgi Lentjes of Germany.
In the case of IGCC, some companies such as Shell, GE Energy, ConocoPhillips, Siemens, British Gas Lurgi and Mitsubishi Heavy Industries have done some work. But you cannot do a cut-and-paste here and a clean coal technology for India’s coals will have to be indigenously developed.
Did we ever do anything on those lines? Oh, yes, we did.
The story goes back to mid-1980s, when BHEL put up a small, 6.2 MW IGCC plant at its Tiruchi complex in Tamil Nadu. BHEL old-timers say the plant worked “reasonably well.” In IGCC plants, you separate the carbon and the pollutants but removal of the pollutants poses a challenge.
Here is where the demonstration plant needed further work. BHEL did not pursue it. If it had, it could have joined the ranks of Shell, Siemens and others.
In the late 1990s, it looked like BHEL and another public sector giant, NTPC, would join hands to put up a commercial scale IGCC plant, just like the APGENCO one. It was estimated that a 100 MW project would cost about Rs 600 crore, while a regular thermal project of similar size would cost Rs 400 crore.
NTPC wanted Government of India’s support to make the project viable. But even as the demand was being processed, the two public sector majors bickered. NTPC felt that since it was footing the bill, it had to share the intellectual property. No way, said BHEL since it believed that IGCC was its hard-earned knowledge. The joint venture proposal thus got nowhere.
Neither BHEL, nor the Ministry of Power, nor the office of Dr R Chidambaram, Principal Scientific Adviser to Government of India (which was to shepherd the project) responded to Business Line’s emails seeking information and update. NTPC said it would put up a IGCC project on its own. No details were forthcoming.
Since BHEL had the basic technology, you might expect it to put up a commercial scale project on its own, out of its own funds, if only to demonstrate its capabilities.
In today’s world, if you have expertise in clean coal technologies such as IGCC and CFBC, you are a clear winner. But BHEL says generating power is not its business. BHEL’s Chairman and Managing Director, B.P. Rao, told this writer a few months back that the company would need to use its financial resources judiciously.
Here, it is pertinent to note that BHEL recently announced a Rs 2,000-crore project to produce poly silicon, used in making solar panels — at a time when poly silicon plants the world over are shutting down due to glut situations.
While the idea is not to question the wisdom of BHEL’s management, the moot point is whether BHEL should put money into development equipment for smart use of coal, or something like poly silicon.
Given that coal is India’s primary energy resource, we should strain every nerve to make the best use of it. The failure of IGCC in the country, as symbolised by the still-born APGENCO project, is an indication of the collective apathy.