Energy

Advantage Of Switching Power Sector From Fuel Oil/Coal To LNG

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<p style="text-align: justify;">It appears that Mauritius is planning to introduce Liquefied Natural Gas (LNG) to the power-generation sector for the first time.&nbsp;</p><h2 style="text-align: justify;"><span style="font-size: 14pt;">Liquefied Natural Gas (LNG)</span>&nbsp;</h2><p style="text-align: justify;">LNG is a clean and relatively environment-friendly energy source. It has been considered that coal has the world's largest known fossil fuel reserves of 900TWyr compared to LNG (215TWyr) and fuel oil (240TWyr). Therefore, with the escalating demand for LNG around the world, the price stability of LNG should also be carefully analysed with that of Coal/HFO. &nbsp;</p><p style="text-align: justify;">The main combustible matters that liberate heat during the combustion of conventional heat sources (e.g., LNG, biomass, coal, fuel oil, etc.) are Carbon and Hydrogen. The Carbon to Hydrogen ratio in LNG (3 to 1) is relatively lower than that of fuel oil (7 to 4) and coal (13 to 6).&nbsp;</p><p style="text-align: justify;">The gross calorific value of LNG (52,358 kJ/kg) is higher than that of fuel oil (43,942kJ/kg) and coal (26,365 kJ/kg). LNG combustion technologies' combustion efficiency and heat transfer performance are relatively higher than those of systems burning the other two commodities.</p><p><img style="display: block; margin-left: auto; margin-right: auto;" src="https://kradminasset.s3.ap-south-1.amazonaws.com/ExpertViews/Alessandropic11.png" width="1153" height="404" /></p><p><strong>LNG as a Clean and Efficient Fuel&nbsp;</strong></p><p style="text-align: justify;">Since these power plants operate far from the end-user, the remaining 60% heat is released into the environment as waste heat. Heat cannot be economically transferred long distances.</p><p style="text-align: justify;">This is due to a higher flame temperature and proper mixing of LNG with combustion air, resulting in low air required for complete combustion. Therefore, LNG generates about 30% less carbon dioxide (CO2) than fuel oil and 45% less than coal.&nbsp;</p><p style="text-align: justify;">Water vapour (H2O) generated during fuel combustion is also a greenhouse gas, but there is no accumulation of water vapour in the atmosphere like CO2 as it is associated with a natural cycle through evaporation and precipitation. The combustion of natural gas does not emit soot, dust, or fumes and almost no environmentally damaging Sulphur dioxide (SO2) emissions.&nbsp;</p><p style="text-align: justify;">With the unavailability of Nitrogen in LNG (fuel nitrogen) and the adaptability of advanced combustion technologies like staged combustion, a two-fold reduction in Nitrogen oxide (NOx) emissions can be observed. Therefore, using LNG has an inherent advantage over other fossil fuels. &nbsp;</p><p><img style="display: block; margin-left: auto; margin-right: auto;" src="https://kradminasset.s3.ap-south-1.amazonaws.com/ExpertViews/Alessandropic12.png" width="437" height="386" /></p><p style="text-align: justify;">The heat from high-temperature energy sources (e.g., LNG / fuel oil) can be converted to electricity more efficiently than other heat sources with relatively low combustion temperatures.</p><p style="text-align: justify;">The main economic advantage of LNG is its use as a fuel in decentralised power generation systems. The process of electricity production using coal or heavy fuel oil (furnace oil) from remote locations is inefficient as it involves the production of heat energy first, which can only be converted into electricity with an efficiency of about 40% (typically 35-40%, but current hybrid cycles or commercially available combined cycle can go up to about 50% in tropical climates).&nbsp;</p><p style="text-align: justify;">Since these power plants operate far from the end-user, the remaining 60% heat is released into the environment as waste heat. Heat cannot be economically transferred for long distances. Therefore, conventional centralised power generation systems already available in Mauritius are less productive in terms of fuel usage.&nbsp;</p><p><img style="display: block; margin-left: auto; margin-right: auto;" src="https://kradminasset.s3.ap-south-1.amazonaws.com/ExpertViews/Alessandropic13.jpg" width="513" height="251" /></p><p style="text-align: justify;">Since LNG is a clean and economically transportable fuel, the decentralised power generation using co-generation and tri-generation systems operating in the proximity of the bulk energy consumers who consume electricity and heat in large quantities enhances the productivity of fuel usage.</p><h2 style="text-align: justify;"><span style="font-size: 14pt;">Tri-Generation Systems&nbsp;</span></h2><p style="text-align: justify;">Export processing zones, hospitals, and hotels are considered bulk energy consumers who need to use electricity, heating and cooling simultaneously. Mostly, electricity is the prime energy source for air conditioning, while fuel oil is used for heating.&nbsp;</p><p style="text-align: justify;">The main concept of tri-generation systems that produce electricity, heating, and cooling simultaneously is based on using this waste heat for air conditioning or other cooling or heating purposes.&nbsp;</p><p style="text-align: justify;">The minimisation of carbon dioxide emission (Carbon footprint) is an essential part of the tri-generation systems, a distributed method of efficient energy production adapted by major cities in the US, UK, Canada, Europe, and Australia. This provides business value for the heat generated in electricity generation.&nbsp;</p><p style="text-align: justify;">Since the electricity and heat needed are produced on-site, low energy distribution/transmission losses are also achieved.&nbsp;</p><p style="text-align: justify;">LNG is a clean and relatively environment-friendly energy source. However, coal/HFO is the most cost-effective energy source for centralised power generation in Mauritius, aside from the risk of environmental pollution.</p><p style="text-align: justify;">The heat from high-temperature energy sources (e.g., LNG / fuel oil) can be converted to electricity more efficiently than other heat sources with relatively low combustion temperatures. Therefore, we can use fossil fuels more productively than just heating applications.</p><p style="text-align: justify;">Tri or co-generation systems typically show higher combined efficiencies (combined electricity generation and useful heat) of about 85%, whereas the modern combined cycle power plants operating in remote tropical climates have shown only about 50%. &nbsp;</p><p style="text-align: justify;">Moreover, LNG offers a lower energy cost compared with traditional liquid fuels. Compared with VLSFO or HFO, LNG's energy cost per metric ton starts with a 20% advantage because it contains 20% more energy per metric ton.</p><h2 style="text-align: justify;"><span style="font-size: 14pt;">LNG as an Energy Source for Industry and Communities</span>&nbsp;</h2><p style="text-align: justify;">Finally, LNG can be used as a fuel source for industries and communities (towns and villages) located in areas not connected to the main gas/electricity networks. Homes in these areas are forced to use home heating fuel or electricity, which are significantly more expensive than natural gas.</p><p style="text-align: justify;">The desire of communities and private individuals to control their budgets is shared by industrial players seeking an economically stable and accessible energy source. LNG is an alternative to fuel oil, LPG, and coal, enabling industrial players to save energy supply costs and equipment maintenance costs.</p><p style="text-align: justify;">In addition to its competitive cost, LNG is an excellent solution to help industrial players bring their facilities into line with current environmental regulations, which will become even stricter in the future. While industry globally accounted for 85% of Sulphur dioxide emissions (SO2) in 2011, conversion of these industries to LNG would lead to the generation of lower CO2 emissions and virtually no nitrogen oxide (NOx), Sulphur dioxide (SO2) and fine particles.</p><p style="text-align: justify;">In Europe, 25% of electricity is produced in coal-fired power plants. These power plants can only convert 33-45% of the energy produced by coal combustion into electricity.</p><p>By way of comparison, a thermal power plant fueled by natural gas rather than coal is associated with:</p><ul><li style="list-style-type: none;"><ul><li>81% reduction in carbon dioxide (CO2)</li><li>8% reduction in nitrogen oxide (NOx)</li><li>100% reduction in Sulphur (SO2) and fine particle emissions</li></ul></li></ul><p style="text-align: justify; padding-left: 40px;">&nbsp;</p><p style="text-align: justify;">The impact of natural gas on the environment is low, such that if coal-fired power plants were replaced by thermal power plants fueled by natural gas, the CO2 emissions of the European energy sector would be cut by 60% and 20% on a global scale.</p><p style="text-align: justify;">Therefore, LNG loaded on trucks could also be used by industrials off-grid or as a cleaner fuel for road or maritime transport.</p><p style="text-align: justify;">At the end of February 2021</p><ul><li style="list-style-type: none;"><ul><li style="text-align: justify;">IFO 380/180: 9,4/11,2 $/mmBTU = 360/430 $/ton</li><li style="text-align: justify;">MGO 0,1% S: 13,q $/mmBTU = 530 $/ton</li><li style="text-align: justify;">Gas TTF: 6,8 $/mmBTU (lhv)= 318 $/ton</li><li style="text-align: justify;">CH3OH: 24,6 $/mmBTU = 464 $/ton</li><li style="text-align: justify;">Crude oil Brent: 12,2 $/mmBTU = 467,2 $/t = 64,0 $/barrel</li></ul></li></ul><p>&nbsp;</p><p><img style="display: block; margin-left: auto; margin-right: auto;" src="https://kradminasset.s3.ap-south-1.amazonaws.com/ExpertViews/Alessandropic14.png" width="839" height="604" /></p><p>&nbsp;</p><p><img style="display: block; margin-left: auto; margin-right: auto;" src="https://kradminasset.s3.ap-south-1.amazonaws.com/ExpertViews/Alessandropic16.PNG" width="738" height="393" /></p><p>&nbsp;</p><p><span style="font-size: 10pt;"><em>This article was contributed by our expert <a href="https://www.linkedin.com/in/ananotti/">Alessando Nanotti</a>&nbsp;</em></span></p><p>&nbsp;</p><h3><span style="font-size: 18pt;">Frequently Asked Questions Answered by Alessando Nanotti</span></h3><h2><span style="font-size: 12pt;">1. Can LNG replace oil?</span></h2><p style="text-align: justify;">Compared to fuels such as oil, LNG has a high energy density, low sulphur content and low carbon emissions, making it an optimal substitute for other, &ldquo;dirtier&rdquo; fuels in the green transition.</p><h2 style="text-align: justify;"><span style="font-size: 12pt;">2. Who are the leading producers of LNG?</span></h2><p style="text-align: justify;">Qatargas. Qatargas was established initially as a joint venture between Qatar Petroleum. ExxonMobil is the biggest LNG producer in the world.</p><h2 style="text-align: justify;"><span style="font-size: 12pt;">3. What is a typical efficiency of a tri-generation system?</span></h2><p style="text-align: justify;">The tri-generation system uses 2173.6 kW of the 3322 kW worth of energy input from biomass. This gives a tri-generation efficiency of 64% and 35.41% for energy and exergy efficiency, respectively.</p><p>&nbsp;</p>
KR Expert - Alessandro Nanotti