Implementation of Indonesia coal downstream policy in the trend of fossil energy transition

Abstract The implementation of downstream coal policies in Indonesia is regulated in Law Number 3 of 2020 to optimize coal’s domestic use and value-added. The policy is also supported by the issuance of fiscal, non-fiscal, and regional incentives. In Law Number 3 of 2020, the government of Indonesia states six types of coal downstream: coal upgrading; coal briquetting; cokes making; coal liquefaction; coal gasification; and coal slurry, yet the government has not defined which downstream coal products should be prioritized. Several parameters must be considered in implementing the downstream coal policy, those are the availability of coal and its characteristics, proven technology, economic and environmental feasibility. This study examines the mineral and coal sector regulation, taxation, coal resources and reserves, technology, and economics. In addition, to implement the commitment of reducing CO2 emissions, this study also considers applying Carbon Capture and Storage (CCS) or Carbon Capture, Utilization, and Storage (CCUS) technology to implement downstream coal policy.

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Making the subsurface political: How enhanced oil recovery techniques reshaped the energy transition

Environment and Planning C Politics and Space ◽

10.1177/2399654419884077 ◽

2019 ◽

Vol 38 (4) ◽

pp. 733-750

Author(s):

Sébastien Chailleux

Keyword(s):

Enhanced Oil Recovery ◽

Oil Recovery ◽

Carbon Capture ◽

Oil And Gas ◽

Global Climate ◽

Carbon Capture And Storage ◽

Energy Transition ◽

Social Protest ◽

Recovery Techniques ◽

And Storage

Analyzing the case of France, this article aims to explain how the development of enhanced oil recovery techniques over the last decade contributed to politicizing the subsurface, that is putting underground resources at the center of social unrest and political debates. France faced a decline of its oil and gas activity in the 1990s, followed by a renewal with subsurface activity in the late 2000s using enhanced oil recovery techniques. An industrial demonstrator for carbon capture and storage was developed between 2010 and 2013 , while projects targeting unconventional oil and gas were pushed forward between 2008 and 2011 before eventually being canceled. We analyze how the credibility, legitimacy, and governance of those techniques were developed and how conflicts made the role of the subsurface for energy transition the target of political choices. The level of political and industrial support and social protest played a key role in building project legitimacy, while the types of narratives and their credibility determined the distinct trajectories of hydraulic fracturing and carbon capture and storage in France. The conflicts over enhanced oil recovery techniques are also explained through the critical assessment of the governance framework that tends to exclude civil society stakeholders. We suggest that these conflicts illustrated a new type of politicization of the subsurface by merging geostrategic concerns with social claims about governance, ecological demands about pollution, and linking local preoccupations to global climate change.

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Economic Conditions for Developing Hydrogen Production Based on Coal Gasification with Carbon Capture and Storage in Poland

Energies ◽

10.3390/en13195074 ◽

2020 ◽

Vol 13 (19) ◽

pp. 5074

Author(s):

Radosław Kaplan ◽

Michał Kopacz

Keyword(s):

Carbon Capture ◽

Coal Gasification ◽

Net Present Value ◽

Carbon Capture And Storage ◽

Economic Assessment ◽

Free Cash Flow ◽

Sensitivity Analyses ◽

Capital Expenditures ◽

Hard Coal ◽

And Storage

This study documents the results of economic assessment concerning four variants of coal gasification to hydrogen in a shell reactor. That assessment has been made using discounting methods (NPV: net present value, IRR: internal rate of return), as well as indicators based on a free cash flow to firm (FCFF) approach. Additionally, sensitivity analysis has been carried out, along with scenario analysis in current market conditions concerning prices of hard coal, lignite, hydrogen and CO2 allowances, as well as capital expenditures and costs related to carbon capture and storage (CCS) systems. Based on NPV results, a negative economic assessment has been obtained for all the analyzed variants varying within the range of EUR −903 to −142 million, although the variants based on hard coal achieved a positive IRR (5.1–5.7%) but lower than the assumed discount rates. In Polish conditions, the gasification of lignite seems to be unprofitable, in the assumed scale of total investment outlays and the current price of coal feedstock. The sensitivity analyses indicate that at least a 20% increase of hydrogen price would be required, or a similar reduction of capital expenditures (CAPEX) and costs of operation, for the best variant to make NPV positive. Analyses have also indicated that on the economic basis, only the prices of CO2 allowances exceeding EUR 40/Mg (EUR 52/Mg for lignite) would generate savings due to the availability of CCS systems.

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Recent developments and current position of underground coal gasification

Proceedings of the Institution of Mechanical Engineers Part A Journal of Power and Energy ◽

10.1177/0957650917718772 ◽

2017 ◽

Vol 232 (1) ◽

pp. 39-46 ◽

Cited By ~ 7

Author(s):

Michael Green

Keyword(s):

Carbon Capture ◽

Coal Gasification ◽

Academic Research ◽

Carbon Capture And Storage ◽

Extraction Process ◽

Pilot Scale ◽

The European Union ◽

Underground Coal Gasification ◽

Product Gas ◽

And Storage

Underground coal gasification is a conversion and extraction process, for the production of useful synthetic product gas from an in-situ coal seam, to use in power generation, heat production or as a chemical feedstock. While many variants of the underground coal gasification process have been considered and over 75 trials performed throughout the world, the recent work has tended to focus on the control of the process, its environmental impact on underground and surface conditions and its potential for carbon capture and storage. Academic research has produced a set of mathematical models of underground coal gasification, and the European Union-supported programme has addressed the production of a decarbonised product gas for carbon capture and storage. In recent years, significant progress has been made into the modelling of tar formation, spalling, flows within the cavity and the control of minor gasification components, like BTEX and phenols, from underground coal gasification cavities (BTEX refers to the chemicals benzene, toluene, ethylbenzene and xylene). The paper reviews the most recent underground coal gasification field trial and modelling experience and refers to the pubic concern and caution by regulators that arise when a commercial or pilot-scale project seeks approval. It will propose solutions for the next generation of underground coal gasification projects. These include the need to access deeper coal seams and the use of new techniques for modelling the process.

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A continuous-time stochastic model to study the abandonment strategy of carbon capture and storage project

10.21203/rs.3.rs-431302/v1 ◽

2021 ◽

Author(s):

Shuhua Chang ◽

Yu Li ◽

Yanqin Chang

Keyword(s):

Continuous Time ◽

Carbon Capture ◽

Carbon Capture And Storage ◽

Stopping Time ◽

Carbon Price ◽

The Government ◽

Hamilton Jacobi Bellman ◽

The Individual ◽

Private Investors ◽

And Storage

Abstract We build a continuous-time stochastic real options model to study the abandonment strategy of carbon capture and storage (CCS) project. Based on the stochastic optimal control theory, we solve the problem with the Hamilton-Jacobi-Bellman variational inequality (HJBVI) to derive the evolution of the optimal CCS investment over time. Using optimal stopping time, we establish a free boundary for each time node over the entire CCS construction stage as a function of the market carbon price and the individual project's remaining total deployment investment. The boundary is to help the investors decide whether to keep investing or abandon the project. Numerical simulations based on Chinese data are conducted by applying the finite element method with the power penalty. Concerning a hypothetical CCS project with a remaining total deployment investment of 10 billion RMB, our projected critical carbon prices relevant to its decisions on CCS project in 2020 are, respectively, 137.27 RMB/ton CO2 (0.123 RMB/kW·h) and 104.14 RMB/ton CO2 (0.093 RMB/kW·h). Being well below either threshold, if the current price prevails in 2020, the private investors will have no incentive to keep investing in or operate the above CCS project. It seems to us that this should indicate the exact right moment for the government to consider subsidizing them with at least the amount of money to prevent their abandonment of CCS from happening.

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