Benefits of Increasing Emission Standards for Coal-fired Power Plants in ASEAN beyond Environment and Health

12th Sep 2017

East Asia depends heavily on coal, given its abundance, as a reliable energy source. Coal use patterns around the region reflect the rising demand for electricity needed to power and steer economic growth. Hence, building low-efficiency coal-fired power plants (CPPs) is an obvious choice for power-hungry emerging Asia, particularly ASEAN, due to less capital costs. However, such plants cause more environmental harm and health issues due to air pollution, CO2 and other greenhouse gas emissions.

The Economic Research Institute for ASEAN and East Asia (ERIA) embarked on a study on emission regulations in fiscal Year 2016-2017 for CPPs in ASEAN, with a comparative analysis of emission standards and regulations for CPPs in ASEAN and some OECD countries. 

The results showed that ASEAN countries have relatively high allowable emissions in terms of Sulphur Oxides (SOx), Nitrogen Oxides (NOx), and Particulate Matter (PM) (see figures 1). This means that ASEAN as a bloc has lower emission standards compared with advanced countries such as Germany, Korea, and Japan where clean coal technology is mandatory. The study also noted that India has high emission standards for newly constructed CPPs, but enforcement of these standards will need to be monitored. Australia, still uses some traditional coal-fired plants yet to retire. China significantly improved its emission standards for CPPs due to government’s policy to reduce air pollution and encourage clean energy.

Emission standards for CPPs in Germany, Korea, and Japan range from 100-150 mg/m3 for SOx, 50-200 mg/m3 for NOx, and 10-100 mg/m3 for PM. However, ASEAN as a bloc has CPPs emission standards ranging from 200-850 mg/m3 for SOx, 380-1,000 mg/m3 for NOx, and 80-400 mg/m3 for PM.

Figure 1: Emission standards for newly constructed CPPs in selected countries (SOx, NOx, and PM).

CPP = coal-fired power plant, mg/m3 = milligram per cubic metre, SOx – sulphur oxides, NOx – nitrogen oxides, and PM = particulate matter.

Major harmful air pollutants, such as SOx, NOx, and PM, come from fossil fuel and biomass power plants,  and thus, need to be carefully regulated. It is known that short-term exposure to Sulphur Dioxide (SO2) can harm the human respiratory system and make breathing difficult. Children, the elderly, and those who suffer from asthma are particularly sensitive to the effects of SO2. Emissions that lead to high concentrations of SO2 in the air also add to the formation of other SOx. Furthermore, SOx can react with other compounds in the atmosphere to form small particles.

These particles then contribute to PM pollution, in which, particles can penetrate deeply into sensitive parts of the lungs and cause additional health problems. At high concentrations, gaseous SOx can harm trees and plants by damaging foliage and decreasing growth. SO2 and other SOx can also cause acid rain, which goes on to harm sensitive ecosystems, and react with other compounds in the atmosphere to form fine particles that reduce visibility (also known as haze). The deposition of such particles can stain and damage stone and other materials, including culturally-important objects such as statues and monuments.

However, clean coal technology known as high efficiency low emission (HELE) coal-fired plant could be a solution for pollution control during the burning of coal. The World Coal Association (WCA) and ASEAN Centre for Energy (ACE) has recently released a report on ASEAN’s Energy Equation, The role of low emission coal in driving a sustainable future, which highlighted the important role of low emission coal in driving a sustainable energy future by investing in HELE technology. The technology can remove about 90 to 99.9% pollutants from coal combustion. In addition, HELE technology could reduce CO2 emission from 25–33% less than the existing average global power fleet and up to 40% less than the sub-critical technology (WCA & ACE, 2017).

ERIA’s study acknowledges that world leaders have taken action to mitigate climate change as committed to at the 21st Conference of Parties or COP21, whereby each country pledged to implement Nationally Determined Contributions to track the progress of climate change abatement. But also suggests that minimising the emission of air pollutants in ASEAN countries become a pre-condition for the future use of CPPs and to move gradually to meet the current emission standards for CPPs of the Organisation for Economic Co-operation and Development countries. This would result in clean coal technology for ASEAN and bring many benefits for the people and environment.

The ASEAN Energy Equation report (WCA & ACE, 2017) also suggested that promoting HELE deployment across ASEAN would result in significant carbon reduction emissions to global benefit. Shifting the region’s forecast coal capacity in 2035 from the current mix to ultra-supercritical would reduce cumulative emissions by 1.3 billion tonnes.

Although clean coal technology known as HELE has potential to be competitive with traditional technology, the higher upfront cost could be a major obstacle for the deployment of HELE to ASEAN (Han, 2015). In this case, innovative financing mechanism will need to be designed including the flexibility of financing of HELE from financing institutions by allowing investors or developers to access to long term loan and possibly low interest rate. Furthermore, the financing framework may need also consider mitigating financial risks by looking into options such as blended financing using both commercial (bank institutions) and private financing; and possibly considering concessional loan/finance from developed country government to support the deployment of HELE to developing world. Another window of financing HELE could also look into the possibility of using public fund such as clean environmental fund to be utilized for clean environmental facilities such as HELE as well.

Besides financing, ERIA’s study suggested that higher environmental standards for CPPs, coupled with effective enforcement, may push investors to select more advanced technologies, especially the Ultra-supercritical technology for CPPs. Such plants are considered clean power because they use coal more efficiently and cleanly, compared to traditional Sub-Critical coal fired power plants.

The study findings suggested that governments’ stringent regulation of standards and enforcement in CPPs emissions can benefit society and environment at large. In addition, it could further influence the future ASEAN power exchange and promote ASEAN towards the clean power investment market.

Reference:

Mitsuru Motokura, Jongkyun Lee, Ichiro Kutani, and Han Phoumin (2017) Improving an Emission Regulations for Coal-fired Power Plants in ASEAN. The report can be accessed at http://www.eria.org/publications/research_project_reports/FY2016/No.02.html

WCA and ACE (2017) ASEAN’s Energy Equation, The role of low emission coal in driving a sustainable future. UK, 2017.

Han Phoumin (2015) Enabling clean-coal technologies, National Bureau of Asia Research (NBR). USA, 2015.

 

The views expressed here are personal and do not reflect ERIA’s position.