Integrated Gasification Combined Cycle (IGCC) power generation has long been recognised for its ability to handle difficult fuels with good environmental performance. Now a new generation of refinery-based projects is demonstrating that the technology is also a cost effective means for power generation.

Faced with the reality of increasing global competition, excess capacity, and tightening environmental regulations, the refiners of the world are taking new approaches to increase profitability and ensure survival, including installation of independent power production (IPP). Refineries offer a natural home for IPP siting, with the ready availability of inexpensive fuels, steam host opportunities, as well as access to existing infrastructure. Integrated Gasification Combined Cycle (IGCC) is fast becoming the environmental, efficient and economic route for refiners entering the independent power production market.

The first commercial scale IGCC projects were clean coal technology demonstrations in both the USA and Europe. Beginning in the mid 1980s, these included the Cool Water and TECO projects (using Texaco technology) and the Wabash River generating station (Dynergy/Destec technology) in the USA. European demonstrations of IGCC have included the Demkolec project in the Netherlands (Shell technology), and the Puertollano project in Spain (Prenflo/Uhde technology).

What these projects have in common is that they are under utility company ownership or management, have received government funding or subsidies, and have technology demonstration objectives not necessarily related to real competitive environments. The results were projects saddled with large investment and operating costs and subsidized economics. The subsequent availability of relatively inexpensive natural gas in Europe and the USA, coupled with the emergence of the IPP industry, resulted in new coal-based power projects being viewed unfavourably, and the perception that IGCC was too expensive and not competitive.

But current refinery-based IGCC projects are demonstrating the economic production of electricity as well as providing the refiners with other benefits, including the flexibility needed to maintain their competitive position. Unlike other power generating technologies, IGCC not only permits refiners to use their most undesirable, difficult to process, and low-valued refinery bottoms as environmentally friendly fuels, but also provides the opportunity for significant co-production (such as hydrogen, chemical feedstock, and industrial gases). Additional IGCC cost savings, resulting from technology advancements and improved construction techniques, has further reduced power generation costs and improved refiners’ operating margins.

Advanced technology

The heart of IGCC technology is gasification, which is an industrial process for the production of synthesis gas, a mixture of carbon monoxide and hydrogen. The modern gasification process, which was originally developed for and is widely deployed today in the production of chemical feedstock, is a partial oxidation reaction carried out in a continuous, high pressure reactor, in a reducing environment. A key advantage of the gasification process is its ability to convert undesirable, low value fuels (high in sulphur, heavy metals, nitrogen and heavy organic compounds), in an environmentally benign manner, to a clean burning synthesis gas. This fuel can then be used in advanced technology combined cycle combustion turbines, as well as a feedstock for chemicals production.

The Texaco Gasification Power Systems process can use almost any solid or liquid hydrocarbon-containing fuels (or mixtures) as feed to the gasification reactor. Solids, such as petroleum coke or coal, are slurried with water, while liquid fuels are co-fed with either water or steam. The fuel mixture is then metered into the gasifier along with a stoichiometric deficient stream of oxygen, thus favouring the production of the partial oxidation products (CO, H2, H2S) over fully oxidized species (CO2, H2O, SOx).

The gasification reaction takes place in a refractory lined vessel at temperatures of 1250°C to 1500°C and pressures of 25 – 85 bar. This high temperature assures that the organic compounds are converted to non-hazardous species, and the inorganic material in the feed is converted to inert slag or ash. Either a low cost quench configuration (as shown in Figure 2) or a heat recovery configuration can be utilized.

Particulates are removed in either the quench chamber of the gasifier vessel (for a quench configuration), and/or in subsequent water washes (for a heat recovery configuration). Due to the chemistry and operating conditions of the gasification reaction, neither dioxins nor furans can form.

The gasification process is differentiated from combustion processes in that sulphur species are converted into H2S (as opposed to SOx), which is easily removed by conventional acid gas removal technologies. Sulphur is subsequently recovered as either merchantable elemental sulphur or sulphuric acid. Gasification thus obviates the use of limestone (which is used in fluidized bed combustion or flue gas desulphurization processes), along with its subsequent solid disposal problems.

The synthesis gas, now clean of particulates and sulphur, can be fed into a combined cycle combustion turbine for the generation of electric power and steam. Additionally, the option exists for the synthesis gas to be used for chemical production, or for hydrogen separation for chemical or refinery applications.

Advanced integration schemes, for further cost reductions and improving efficiency, include additional heat recovery as well as tie-ins between the oxygen plant and the combined cycle power block.

Refinery economics

The primary objective of most refineries is to upgrade crude oil into the maximum amount of salable products (generally liquid fuels), which are being subjected to ever more stringent specifications. However, most crude oils contain only a small portion of these desirable liquid fuels. Therefore, sophisticated refineries utilize a number of processing schemes to upgrade oil to maximize light products.

The consequence of these processes is the production of undesirable ‘bottom of the barrel’ residues, a concentration of all of the undesirable components of the crude oil, including sulphur, vanadium, nickel, other inorganics and heavy organic compounds.

While these materials can be blended with higher valued lighter refined products to produce marketable fuels, the refiner is faced with the issues of:

  • Effectively down-grading the lighter products in order to produce merchantable fuels out of the residues, and
  • Increasingly more stringent environmental specifications for these heavy fuels, further making the utilization of the residues more difficult and less profitable.

As additional market and profitability pressures push refineries to employ more capital intensive, deeper recovery processes and utilize heavier crudes, the quality of these residues deteriorates. The challenge facing many refiners is finding a way to maximize the value of these increasingly less salable residues.

As a solution, many refineries have recognised that IGCC allows them to convert these unmarketable residues into valuable products, resulting in refineries with little or no heavy residue production, in a so called ‘bottomless’ refinery configuration. (Refineries had traditionally used gasification as a means of bottoms-end destruction or for the production of hydrogen for captive use). Using IGCC, the refineries are able to increase their overall profitability and improve their relative competitive position by:

  • Permitting more extensive upgrading of heavy materials to produce yields of lighter products, eliminating the need to dispose of increasingly unmarketable bottoms products
  • Providing greater flexibility in crude slate selection, without concern for bottoms utilization
  • Increasing the economic value of the produced residues, through upgrading them to electric power and other products

IGCC offers refiners other inherent economic advantages over competing power generation options (such as circulating fluid bed and flue gas desulphurization), including:

  • Co-production of: hydrogen (for hydro-processing, which will become even more prevalent as tighter emissions requirements require more desulphurization); synthesis gas (for chemicals manufacturing); and industrial gases (oxygen and nitrogen) thus displacing the need for other, more valuable feeds, as well as additional process equipment
  • Superior environmental performance, potentially reducing overall emissions for the refinery and eliminating or reducing the need for additional pollution control equipment
  • Destruction of refinery waste streams, eliminating tipping costs associated with their disposal, as well as deriving maximum fuel value from them
  • Easy integration with existing refinery equipment and infrastructure.

In addition to the three Italian refineries completing construction and commissioning of IGCC facilities (API Energia, Sarlux, and ISAB Energy), two other European refineries – Total’s Gonfreville (Normandy, France) and Repsol’s Petronor (Bilbao, Spain) – are developing IGCC projects based on Texaco technology.

Gonfreville: Total, EDF (the French state-owned electric utility), and Texaco are partners in the development of this IGCC project for the refinery near Le Havre. The facility will utilize between 800 000 and 1 000 000 tonnes per year of residue, with 365 MW of net power being exported to the electrical network, and the production of 250 tonnes per hour of high pressure steam and 100 tonnes/hour of H2 + CO. Final commissioning is scheduled to be completed by early 2004.

Petronor: The project is being jointly developed and owned by Repsol, electrical utility Iberdrola, and Texaco. The project will utilize refinery residues as feed and produce 824 MW of power, going to both the refinery and the Spanish electricity grid. Construction is scheduled to begin in 2000, and will take four years to complete.

Trends in cost

First generation IGCC projects, dating from the 1980s, were largely built as technical demonstrations, and had relatively high capital costs, sometimes in excess of $2000/kW. In fact, many of the technical objectives of the facilities were not aligned with low cost power production. Typical factors contributing to costs included excess or redundant equipment (required for specific technical demonstrations or processing scheme comparisons), as well as plants whose design were not optimized for fuel values and low power production costs. Additionally, these first generation facilities represented designs early in the technology learning curve, and as such, had many components that were oversized or designed with excess specifications and margins.

The further deployment of IGCC facilities has resulted in reductions in costs, consistent with the experiences of other technologies as they move down the learning curve. Specific reasons this can be attributed to include:

  • Improved, more efficient and less expensive combined cycle combustion turbine technology
  • Enhanced air separation technologies with greater integration with the IGCC
  • Standardization of designs and equipment components
  • More operating experience, resulting in tighter engineering design specifications
  • Increased competition among an expanding list of EPC contractors experienced with the technology, coupled with improved construction techniques, construction management, and shorter construction cycles
  • Expanded use of value engineering and optimization, required by the greater number of ‘economically’ driven projects

Refinery-based projects have additional factors that result in further reductions in both capital costs and electricity production costs, including:

  • Inexpensive fuels, having both direct fuel contribution savings in addition to lower capital costs resulting from simpler equipment configurations matched to the low fuel values
  • Integration with the refinery and use of existing infrastructure, as well as shared operation and maintenance costs
  • Co-production, contributing both to unit capital cost reduction (due to economy of scale), as well as ‘subsidization’ of power costs by co-products
  • Credit for destruction of refinery wastes

Bids recently received for lump sum EPC refinery-based IGCC projects are now coming in significantly under $1000/kW. Additionally, recent engineering studies indicate that the use of next generation combustion turbine technology will drive IGCC costs into the range of $850/kW.

While this range of capital cost is still higher than those of natural gas fired combined cycle plants, the lower value of the refinery bottoms fuel can more than offset this, and result in extremely competitive power costs, even without the additional cost benefits of refinery integration and co-production.

Future challenges

IGCC has established itself with refiners as the preferred means of using and enhancing the value of heavy, environmentally difficult fuels. Familiarity with the general processing technology, as well as industry competitive pressures, has helped to accelerate the refining industry’s acceptance and recognition of IGCC, and has made refiners the leader in this technology’s deployment.

Future developments and improvements in combined cycle equipment and associated technologies will help to further reduce IGCC costs. With increasingly more stringent environmental requirements, IGCC can prove to be the means for the most cost effective and environmentally sound use of a wider slate of fuels for power generation.