Saskpower

Since its early pioneering work in single conductor distribution over 50 years ago, SaskPower has had a strong international reputation for innovation. SaskPower is now building on that legacy with a completed design for the world’s first near zero emissions coal-fired power plant. What makes this design even more attractive is its ability to use carbon capture for enhanced oil recovery (EOR). From a technical standpoint, SaskPower has already engineered the plant to the point where definitive equipment and construction costs can be determined – positioning this innovative power plant to be the foundation for a true zero-emissions future in Saskatchewan and beyond.

SaskPower, a Crown corporation owned by the government of Saskatchewan, is the principal supplier of electricity in the province. SaskPower is mandated to provide safe, reliable and sustainable electricity for a province of approximately one million residents. To meet this obligation, SaskPower owns and operates approximately 3000 megawatts (MW) of generation facilities and contracts for another 600 MW of electricity from the private sector. Approximately 60% of Saskatchewan’s electricity is produced from coal.

Recognising the opportunity presented by Saskatchewan’s abundant coal reserves – but also acknowledging the dual challenges of reducing greenhouse gas (GHG) emissions and the need to replace a significant portion of its generation facilities (many of which were built in the 1960s) – SaskPower became a founding member of the Canadian Clean Power Coalition (CCPC) in 2000. As the work of the CCPC matured, SaskPower identified the need for a tangible proposal for a coal-fired unit with carbon capture.

To fill this need, SaskPower’s Clean Coal™ Project team formed alliances with Marubeni Canada, Hitachi, Babcock & Wilcox Canada (B&W),Air Liquide and SNC-Lavalin, and Neill and Gunter to develop design and supply solutions for the clean coal portion of the facility. SaskPower used internal expertise to finalize the carbon capture/EOR operations. Through these efforts, guided by a long history of international technical collaboration, SaskPower has moved the project forward from a theoretical concept to a workable design. The result was a proposal for the construction of the Shand 2 Clean Coal™ Unit – a comprehensive design for a commercial, fully carbon managed, coal-fired generating unit supported by CO2 sales.

SaskPower’s proposed Shand 2 Clean Coal™ Unit features:

• Full commercial scale (300 MW net)

• Supported by international equipment supply contractors

• Documented technology and risk assessment

• 100% reduction in SOx, particulates, Hg

• More than 99% reduction in NOx

• 95% reduction in GHGs with opportunity in future for 99+% reduction

• Same lead time as conventional coal plant (five-year lead time to be in service)

• Technology platform suitable for other carbon capture projects

• Very high quality CO2 stream for sale for EOR

• Net improvement in overall fossil fuel stock (produced oil has more energy than the energy consumed through coal)

• EOR operation further reduces global CO2 because of the cleaner production/ transportation of oil

In spite of its favourable environmental profile, the Shand 2 Clean Coal™ Unit is not without challenges. Critical materials, such as high temperature steel, are at all-time high prices and are in high demand. Labour costs in North America – and particularly in Western Canada – are also on the rise. In addition to standard project and business risks associated with electricity projects, the Shand 2 Clean Coal™ Unit must be viewed in the context of integrated electricity and oil co-production, oil price volatility, uncertainties in evolving environmental legislation and broader capital exposure.

Based on these factors, SaskPower determined that a gap currently exists between economic value of the Shand 2 Clean Coal™ Unit proposal and its cost. For that reason, and because the plant could not be built in time to meet the province’s imminent need for additional electricity supply (2010), SaskPower opted not to proceed to the construction phase at this time. SaskPower continues to improve design, reduce uncertainties, work with EOR customers to optimise product value, and work with governments to support this pivotal development.

Through the work of SaskPower’s Clean Coal™ Project team, Canada has a unique opportunity to extend its leadership in carbon sequestration to also include non-emitting coal technology. The renowned International Energy Agency (IEA) GHG Weyburn Midale CO2 Monitoring and Storage Project – located near two of SaskPower’s major coal-fired generating stations – already demonstrates the effectiveness of CO2 storage and the economic value that EOR can bring to Saskatchewan.

With estimates that nearly 40% of the world’s electricity will be produced from coal by 2020, a commercial Clean Coal™ Unit – such as the design developed by SaskPower – has the potential to change the way we produce electricity from this abundant, secure and affordable source of fuel.

For more information about SaskPower’s Clean Coal™ Project, visit www.saskpower.com.