Could Mesaba Energy Project really ‘convert’ back to coal?

Earlier this week, we told you about the troubled Mesaba Energy Project, a proposed coal gasification plant in northern Minnesota that, after 10 years of planning, still doesn’t have a power purchase agreement or investors to begin construction.

A bill in the state legislature would allow the project to proceed as a natural gas plant, while still keeping the millions of dollars in “advanced energy” funds it has been awarded by the state.

Tom Osteraas, attorney for the developers, said this wouldn’t be a “bait-and-switch,” but would just allow one of two phases of the plant to go on hold:

Osteraas explained that the facility they proposed is a two-piece operation. The first is essentially a coal refinery, in which coal is converted into a synthetic gas. The second piece is a gas-burning power generator. If the current legislation passes, it would allow Excelsior to build the second component first and power it with natural gas. The coal-gasification element could be added later, “if and when” economic conditions dictate, Osteraas said.

That explanation makes intuitive sense, but may not make economic sense, at least not according to Ronald R. Rich, a Twin Cities-based engineer and president of Atmosphere Recovery, Inc. Rich, who testified against the project before the state PUC in 2007, had this to say in a comment posted this morning:

It would be prohibitively expensive for Excelsior to convert their proposed natural gas combined cycle (NGCC) plant to an integrated gasification combined cycle (IGCC) coal plant in the future. No matter what they claim.

Excelsior would have to purchase special and much more expensive combustion gas turbines that could use both the relatively clean and high energy content natural gas and also the much dirtier and lower energy content IGCC syngas at the time they constructed their NGCC plant.

And they would also need to install much more expensive steam tubes than NGCC requires if they ever wanted to generate steam from the combustion turbine exhaust of an IGCC plant.

Excelsior would never do this because installing “upgradeable” equipment would be cost-prohibitive and result in an unaffordable electric plant.

So in short, Excelsior’s plant would not be convertible. They may argue it is “technically possible” but will completely ignore economic facts. And will further minimize the additional massive extra expense needed for the syngas generation portion of the IGCC conversion also required.

Conversion would never happen.

So, a question that state legislators clearly need to ask is whether the turbines in the proposed plant will be able to operate on both coal syngas and natural gas. The two gases are chemically quite different and have different energy potential.

2 thoughts on “Could Mesaba Energy Project really ‘convert’ back to coal?

  1. Thanks for digging deeper on this one, Ken.

    The engineer is correct that conversion doesn’t make economic sense, and in fact no coal plant makes economic sense for Minnesota. But Mr. Rich’s comments are perhaps too pessimistic about the technical feasibility of such a conversion. Natural gas combined cycle power plants are routinely built with the ability to burn both natural gas and various grades of fuel oil. As to the potential for a future conversion from natural gas to coal gasification, this scenario is not that far fetched. Wisconsin Public Service Company, the IOU in the Green Bay area, had a detailed engineering proposal from Black and Veatch for just such a project back about 5 years ago. This was one of the options evaluated when WPS and Dairyland were looking for additional baseload (they ultimately built Weston 4, a supercritical pulverized coal plant near Wasau).

    A related but different approach for coal gasification and natural gas generation went beyond the feasibility stage to fully engineered proposals at two other locations in the Midwest. The Tenaska and Cash Creek projects that were called “Hybrid IGCC” consisted of a coal gasification to substitute natural gas plants (modern versions of Dakota Gasification’s facility in Beulah, ND) coupled with conventional natural gas combined cycle power plants. Gasifying coal to create substitute natural gas is identical to creating syngas, with the addition of a methanation process that converts the syngas (hydrogen and carbon monoxide) to methane with a catalyst. Those developers chose that approach for flexibility because the power plant side could use pipeline natural gas or natural gas from the coal gasification, and the coal gasification plant could feed the natural gas power plant OR the natural gas grid. Whether either of those projects made sense in Illinois and Indiana is up for debate (both would be near coal and sequestration sites), but few would agree a coal plant makes any sense for Minnesota’s iron range under any circumstance.

  2. Peter – thank you for your comment. I agree with you, so if I caused any confusion, let me correct it here. It is “technically feasible” (I used the term “technically possible”) to convert an NGCC plant to an IGCC plant.

    What I said was: “Excelsior would never do this because installing ‘upgradeable’ equipment would be cost-prohibitive and result in an unaffordable electric plant”.

    My concern is that Excelsior will tout natural gas to coal upgradeability and ignore economic reality as they have before (most especially when they touted carbon capture “upgradeability” for their proposed coal plant). Just so their management can continue to receive more government funding for projects that will never be built.

    And I hope this time our legislators will be smart enough to realize Excelsior’s economic information simply can’t be believed.