AB 32 and Emissions Offsets for Power Generation

What does an electric power provider do, when faced with the following:

1) A growing population and growing electric demand in its service area;

2) A critical shortage of air emissions reduction credits (ERC's);

3) An air quality agency that requires any new source of air pollution to provide an equal or greater reduction in air pollution within the jurisdiction;

4) Power generation technology that emits a certain amount of pollutants, unless one wants to install intermittent and unreliable forms of generation such as solar and/or wind;

5) No possibility of building a nuclear power plant, as that is banned by state law;

6) No possibility of building a coal-fired power plant, as that is banned by state law;

7) No possibility of building a gas-fired power plant unless it is of the high-efficiency, combined-cycle cogeneration design;

8) Environmental Justice groups that vehemently oppose cap-and-trade, in which emissions from polluters in their neighborhood are allowed to continue while reductions are made somewhere else, likely far away;

9) Environmental attorneys who file lawsuits to block the permitting and construction of badly-needed new power plants; claiming that previously obtained offsets (ERCs) are invalid; and

10) An ever-growing number of wind-turbines, which produce power primarily at night when the electric load is lowest.

If only the engineers or scientists or economists could develop a safe technology to solve all of the above, seemingly mutually-exclusive requirements.

Is there a solution, that provides the missing emission reduction credits, reduces emissions from new power plants at their site and not someplace far away, and absorbs excess electric power from wind-turbines?

Such a solution exists and was proposed by Mr. Sowell, and it is as follows.

A gas-fired combustor, such as those found in large gas-turbines, burns much cleaner with respect to NOx and CO (nitrogen oxides, and carbon monoxide) when the natural gas fuel is supplemented with gaseous hydrogen in the amount of 10 to 15 percent. The amount of emissions reductions is on the order of two-thirds.

Thus, using round numbers, an existing power plant that emits 300 tons of pollutants per day would emit only 100 tons per day with this modification. The other 200 tons per day could be converted to emission reduction credits, properly verified, and applied toward two new power plants of the same output. The two new power plants would also emit 100 tons per day each. For our hypothetical power utility, if 10 new power plants are needed, then it would need to retrofit 5 existing power plants to obtain the emissions reduction credits.

Retrofitting existing power plants to burn hydrogen is not cheap, but it can be done. Building new power plants with the hydrogen-burning capability is much less expensive.

Obtaining hydrogen to burn in the power plants is not difficult, but it is expensive. Traditionally, the lowest-cost form of industrial hydrogen is from steam methane reforming, known as SMR. The SMR process uses natural gas both as a feedstock, and as fuel for heat. The feedstock is chemically converted to hydrogen and CO2. The SMR plants therefore also need emission reduction credits, so this alternative is not suitable.

But there is another way to produce hydrogen, and that is from electrolysis of water. Electrolysis uses a great amount of electricity to split water into oxygen and hydrogen. The technology is not new, but is well-proven over decades of use. The high cost of electric power results in the high hydrogen price from electrolysis.

But, wind-turbines can provide very low-cost power for water electrolyzers. Where wind-turbines generate power at night, the off-peak price of power decreases to a relatively low level. This low-cost off-peak power can be used by water electrolyzers to produce hydrogen. During the day, when power prices increase, the water electrolyzers can be throttled back to some minimum production rate and thereby minimize operating costs. At night, the water electrolyzers would be pushed to full capacity, taking advantage of the low-cost power.

The hydrogen produced would be compressed and stored until needed. The compression and storage of hydrogen are also very well-known and safe technologies, having been perfected over many decades by the chemical and oil refining industries.

California, especially that portion of Southern California that is within the jurisdiction of the South Coast Air Quality Management District, SCAQMD, faces precisely the situation described above. The state has mandated under the Renewable Portfolio Standard that at least 20 percent of all power sold in the state by December 2010 must be from renewable sources. Further, by 2020, 33 percent must be from renewable sources. While not all of the new renewable energy will be from wind-turbines, a good portion of it will be. Other renewable power will be obtained from solar, from geothermal, from bio-mass, and from solid waste such as landfills.

In Southern California, the wind typically blows strongest at night, as the deserts cool off and draw air inland from the coast. The wind passes through various mountain passes, where wind-turbines are installed. The night winds cause the off-peak electrical power generation described earlier, and may result in the gas-fired power plants shutting down at night in order to maintain proper balance of the electrical load. Such stopping and starting of gas-fired power plants is not good from a mechanical and maintenance standpoint, as it is less stressful on the power plants to run more or less continuously.

The solution is fairly elegant, in that many problems are solved at once. The new power plants obain their badly-needed emission reduction credits, excess wind-power is used to good account, and Environmental Justice stakeholders obtain less pollution, both from existing power plants and from new power plants.

The solution is before us; now it remains to be seen if it is in fact implemented, and how soon.

Roger E. Sowell, Esq.

Mr. Sowell is a Climate Change attorney, with a B.S. in chemical engineering. He may be contacted at his legal website.