U.S. Economic Competitiveness

Gasification is a versatile technology that uses coal to produce power and produces, or co-produces, fuels and chemicals. Coal, an abundant domestic fuel source with a stable price history, supports the U.S. economy, resurgent industry, and even U.S. exports. Coal-based gasification systems integrated with advanced technologies to improve process efficiency and reduce costs are being developed by the U.S. Department of Energy (DOE) and will be able to generate power with up to 90 percent carbon capture, as well as co-produce chemicals, fertilizers, hydrogen, and/or transportation fuels. Carbon captured from gasification plants can be compressed, transported via pipeline, and injected into a depleted oil reservoir for (1) enhanced oil recovery (EOR), thereby increasing the production of domestic oil, or (2) as feedstock for value-added products of commerce. Furthermore, natural gas prices are currently low; however, records show natural gas does not have a history of stable prices, and most predictions for natural gas prices have not been accurate. The Cost of Fossil-Fuel Receipts at Electric Generating Plants chart compares the historical cost of coal, natural gas, and oil for electricity-generating plants. See the link below for an explanation of the factors affecting natural gas prices.

Source: U.S. Energy Information Administration 2014

Coal is, and will remain, a key component in our electricity-generating portfolio. For the U.S. economy to be strong there must be enough continuous low-cost fossil-based power available for the foreseeable future.  Gasification-based systems with superior environmental performance, through the development of advanced, highly efficient, low-cost technologies to convert coal into power with carbon capture, can fill this role. The industry and DOE have performed numerous techno-economic analyses on how gasification systems compete with other technologies to transform coal into power and other products, and also showing the advantages anticipated from the ongoing DOE-supported research and development (R&D) program.

Gasification, a flexible, reliable, and clean energy technology, can turn a variety of low-value feedstocks into high-value products. Approximately 50 percent of the coal produced in the United States is low-rank coal (sub-bituminous coal and lignite). Low-rank coal (sub-bituminous coal and lignite) has less energy per pound than higher-ranked eastern (bituminous) coal, but costs much less, comprises half of the coal reserve in the United States, and is the predominant coal in the west.

DOE's Energy Information Agency (EIA) forecasts significant growth in western coal production, declining eastern coal production, and that the cost per British thermal unit (Btu) of low-rank western coal will remain at about half that of eastern coal. One focus of the DOE Gasification Systems Program is to position low-rank coal gasification to boost the economy of regions with low-rank coal reserves, providing added energy security to the United States through the ability to reduce the cost of low-rank coal gasification. In addition, low-rank coal is also a major coal resource in other countries, including India, China, Turkey, Australia, and Eastern Europe. Technologies developed in the United States to make low-rank coal gasification economically competitive would enable developing countries with low-rank coal reserves to more actively participate in carbon capture and sequestration (CCS) initiatives.

R&D projects to reduce the cost of low-rank coal gasification are listed below:

    Recently awarded projects

    Completed projects