Coal Mining Abatement Technology Support Package Research Plan July 2012 1 Preamble The Coal Mining Abatement Technology Support Package (CMATSP) Research Plan (the Research Plan) aims to guide the development and implementation of research, development and demonstration (RD&D) and safety and regulatory elements under the CMATSP. The CMATSP is a key element of the industry assistance package established under the Clean Energy Future plan to support the transition to carbon pricing1. The Research Plan has been developed by the Department of Resources Energy and Tourism (the Department) and the CMATSP Technical Advisory Committee (TAC) and endorsed by the Minister for Resources and Energy (the Minister). The research plan establishes the key priorities to be addressed through the CMATSP. Prospective applicants will need to also review the Program Administrative Guidelines for the CMATSP which contains the details on the eligibility criteria, merit criteria and assessment process that will be used by the Department and the TAC to assess projects for funding approval by the Minister or his delegate. The Research Plan will be reviewed on a regular basis to take account of technological developments and changing priorities. Substantive changes in the Research Plan will be referred to the Minister for consideration. 2 CMATSP The objective of the CMATSP is to maintain the future viability and international competitiveness of the Australian coal mining industry under Australia’s carbon pricing scheme by supporting industry efforts to develop and demonstrate technologies that will provide future solutions to safely reduce fugitive methane emissions from coal mining. It will do this by: supporting industry efforts to develop technologies and processes that provide future solutions to safely reduce fugitive methane emissions from coal mining; addressing mine occupational health and safety issues associated with the development and deployment of coal mining greenhouse gas mitigation technologies; and supporting smaller and medium sized participants to develop greenhouse abatement strategies. The Australian Government is contributing $70 million to the CMATSP over five years commencing 1 July 2012. Matching contributions from industry and other sources will support a work program with a total value of around $140 million. The Research Plan identifies and prioritises technologies and issues that need to be addressed through further Research, Development and Demonstration (RD&D) to address each of these elements of the CMATSP. The Minister established the TAC to draw on the expertise of its members representing key stakeholder groups to provide advice that will guide the development and implementation of the CMATSP. Advice from the TAC to the Minister will guide the selection of RD&D activities to be funded under the CMATSP. 1 Further details on the Clean Energy Future plan can be found on the Clean Energy Future website at: www.cleanenergyfuture.gov.au Coal Mining Abatement Technology Support Package 2 3 Research Priorities The key priorities for activities to be undertaken through the CMATSP are: Measuring and monitoring of greenhouse gas emissions; Indirect abatement systems - emission avoidance and capture of methane in drainage gases; Direct abatement – capture and use of ventilation air methane (VAM); and Abatement safety Attachment A provides an overview of the range of abatement related technologies and the timelines involved in making these technologies ready for full scale commercial deployment at mine sites. 3.1 Measuring and monitoring greenhouse gas emissions Technologies associated with measuring and quantifying fugitive emissions in underground mining are being developed and have included consideration of meeting health and safety requirements. Measurement and monitoring hardware for these systems is generally available. The industry is already supporting research that is addressing reliability and verification issues in applying these technologies. This research will also identify the need for further work in this area. However, consideration may need to be given to supporting the development of skill sets needed to make the most effective use of these systems. Reliable coal mine methane measuring, monitoring and forecasting systems that help in predicting long term magnitude, quality and sources of methane production and emissions will be important to an integrated and optimised coal methane management processes, particularly in deep and complex mining conditions. Significant advances have been made in developing equipment that can be used commercially to monitor and measure the gas content of coal from open cut mines. Further work is needed to incorporate this hardware into robust and reliable systems ready for commercial deployment at mine sites. In addition and given the challenges of measuring emissions from open cut coal mines, consideration will also be given to novel approaches to this complex measurement problem. 3.2 Indirect Abatement Systems - Emission Avoidance and Capture of Methane in Drainage Gases In straightforward mining conditions, the Australian industry has the expertise needed to design drainage systems that can also make an effective contribution in reducing methane entering the ventilation system. However, further work may be needed to design and implement drainage systems that increase the flow rate, quantity and quality of gases drained prior to mining and from goafs post mining especially in difficult mining conditions (eg deep and multiple seams, coals with low permeability). Further research may be needed to advance the application to Australian conditions of inseam drilling processes especially for deep seams that are not accessible with surface drilling. Pre-drainage at open cut operations is not traditionally practiced in Australia. Consideration may need to be given to the role that pre-drainage at open cut operations can play in Coal Mining Abatement Technology Support Package 3 reducing fugitive methane emission and carbon liabilities. This may include examining the role that CMATSP can play in developing technology for use exclusively in supporting predrainage at open cut mines. It may also include examining the potential contribution that the coal seam gas industry can make in supporting pre-drainage at future open cuts and underground mines. Pre-drainage can involve a highly visible drilling program that may have a negative impact on community perceptions. There may be the need to undertake additional research on such issues to support community consultations and outreach work. Technologies that utilise drainage gases are well understood and are commercially available. This includes flaring, clean-up and concentration of drainage gases, pipeline dispatch and power generation. Any further work in this area will need to be justified in terms of the contribution it makes in improving the cost effectiveness and performance of systems that are currently available on a commercial basis. The overall priority for indirect greenhouse gas avoidance systems is closely linked to future development plans for the coal mining industry. Mines that are developed over the next 5-10 years will place a high priority on access to indirect systems that have the potential to reduce the cost of greenhouse gas abatement compared to systems that rely on capturing VAM gases. 3.3 Direct abatement - Capture and Use of Ventilation Air Methane VAM gases currently account for around two thirds of fugitive methane emission from underground coal mines. Emissions intensive mines need access to technological solutions that will allow them to flare or utilise VAM. The cost of installing and running these processes must be justified in terms of savings on carbon liability costs and maintaining their competiveness. Mine safety is an overriding consideration given the interaction of VAM mitigation systems with the mine ventilation systems. As indicated in Attachment A, thermal flow reversal reactors (TFRR) are the VAM mitigation technologies at the most advanced stage of development. If safety issues are satisfactorily resolved within the next two years, TFRR could be ready to be deployed on a full scale at Australian mines within five years. However, the actual take-up of these technologies could be delayed with mines waiting on the demonstration of different versions of TFRR which may be better suited to their operations. Consideration may therefore be given to supporting the demonstration of different versions of TFRR that meet different mine operating conditions. Where problems generic to this range of technologies have been identified with previous trials consideration may be given to supporting research into potential solutions. Catalytic flow reversal reactors (CFRR) are not as advanced as TFRR and face additional challenges before they are ready for commercial deployment. Before considering support for CFRR projects in Australia, further research may be needed to compare the potential benefits and the priority of CFFR and TFRR. Lean burn VAM gas turbines integrate the capture of the VAM with the generation of electricity. They offer potential energy benefits over TFRR but they need to be a competitive source of electricity. Analysis is needed to determine the potential economic viability of lean burn VAM gas turbines in Australia’s electricity market. This may need to be linked with wider research on life cycle analysis and energy balances for different abatement technologies and consideration of the opportunity cost of using drainage gases to supplement VAM in some lean burn gas turbine systems. Coal Mining Abatement Technology Support Package 4 As with TFRR and CFRR, lean burn VAM gas turbines are based on modular designs. The penultimate step to all these technologies being available for full scale deployment is for mine site trials of full sized modules. It is in the commercial interests of the suppliers of these technologies to support the demonstration of commercial sized modules at mines sites. However, mine site trials can involve substantial upfront costs many of which are fixed regardless of the number of modules being deployed. High fixed costs are a disincentive for single module trials which provide only fractional reductions in emissions. At the same time, the potentially high cost of individual modules and risks associated with trialling a new technology for the first time can weigh against multi-module trials. CMATSP funding has been provided in part to address underinvestment in the development of these technologies due to potential cost barriers such as these. Consideration will be given to funding trials of commercial sized modules for technologies that can be shown to make a potentially valuable contribution to greenhouse mitigation at Australian mines and where the demonstration project makes an essential contribution towards these technologies becoming ready for commercial deployment in Australia. Subject to budgetary constraints, consideration will also be given to supporting the non-commercial costs of first of a kind full scale installations where this will make a major contribution to advancing the commercial availability of these technologies in Australia. Budgetary issues and competition for CMATSP funds will be a major constraining factor in the support that can be provided for demonstration projects. In this context, the one for one leveraging requirements for the CMATSP should be considered a minimum requirement. Applicants including technology suppliers and other funders may need to contribute more than half the total cost of the project. There are a range of other VAM mitigation technologies that are based on replacing combustion air with VAM air. Many of these have been developed for niche applications such as replacing combustion air in coal and gas fired power stations adjacent to a coal mine, or providing partial solutions for dealing with some of the VAM air flow by replacing combustion air in drainage gas generators or the flaring of drainage gas. Proponents putting forward projects for consideration in this area will need to be able to demonstrate that the deployment of their technology will make a substantial contribution to reducing industry emissions that goes beyond niche applications or that the integration of their technology with other technologies at a mine will make a substantial contribution to reducing the overall cost of greenhouse abatement. Innovative solutions applied to currently available technologies and the development of next generation technologies such as methane concentrators and biological treatment have the potential to reduce the longer term costs of direct VAM abatement. Consideration will be given to supporting research programs that build and maintain the expertise to respond to current industry challenges, support the development of innovative solutions and undertake blue sky research. 3.4 Abatement safety Addressing safety issues is paramount in the development and implementation of greenhouse gas abatement technologies for coal mining. Risks associated with the implementation of abatement technologies must address the safety issues to the satisfaction of the relevant regulatory authorities, individual mine management and the workforce. These risks may arise from: the interface of abatement technologies with the mine; the type, integrity and reliability of control systems required to manage the abatement activities; Coal Mining Abatement Technology Support Package 5 the specific challenges for a given technology in the setting that it is to be applied; the impact of the existing mining operations, including on the ventilation system; and the potential to change existing mine systems to suit the technologies employed. Considerable progress has been made in recent years in developing new abatement technologies. Australia has been at the forefront of work in this area. However, the further development and deployment of these technologies in Australia is being constrained to a certain extent by gaps in the availability of accurate and factual information particularly in relation to managing safety issues. Australian mines will not be prepared to undertake full scale installations until safety issues are satisfactorily resolved and factual information including design guidelines are disseminated to coal mines and regulators. This will require additional research that builds on research already being supported by the industry to identify and manage safety risks. In other cases it will require further trials of different technologies at mine sites with information on these trials being widely disseminated. Each of these issues will need to be addressed in any research, development and demonstration activities that are funded through the CMATSP. Additional work may also be required to address specific issues or to further develop the understanding of how abatement technologies may be safely implemented at coal mines. 4 Eligible Activities The types of RD&D activities that can be supported under the CMATSP include: Discrete research projects that address key issues or support the further development of key abatement related technologies and processes; Research projects or consultancies that address specific issues particularly mine health and safety issues associated with the development and deployment of abatement related technologies and processes; Multi-year research programs by institutions that build and maintain generic industry expertise that support the further development of abatement related technologies and innovative solutions, address identified priorities and have the capacity to respond to new priorities; or Trials and pilot demonstrations of key technologies, control systems and processes including mine site trials. Funding limitations will limit the size and number of demonstration projects unless larger projects are substantially self funded. All RD&D activities funded under CMATSP require at least a matching contribution from other sources. This is a minimum leveraging requirement and depending on CMATSP funding constraints and competition for funding, proponents may need to provide more than just a matching contribution. In some cases, projects may be eligible for funding support from the Australian coal industry’s own industry generic research programs, namely the Australian Coal Association Research Program (ACARP) and the Australian Coal Association Low Emission Technology (ACALET). These programs have their own set of research priorities and funding requirements. These research priorities will to some extent be reflected in CMATSP’s own research priorities given CMATSP’s objective includes the need to complement and support industry efforts in progressing the development of abatement related technologies. Cooperative arrangements between CMATSP, ACARP and ACALET will identify and support mutually beneficial joint projects. Coal Mining Abatement Technology Support Package 6 The general process that will be used in selecting projects are outlined in the CMATSP Program Administrative Guidelines (PAGs) which will be published in conjunction with the Research Plan on the Department’s website. The PAGs includes eligibility criteria and merit criteria that will used in considering the contribution and value for money of project proposals. The PAGs also indicates that research and technological development priorities identified in this Research Plan will be used in selecting projects for funding support under CMATSP. Coal Mining Abatement Technology Support Package 7 Attachment A Chart 1: Minesite Mitigation Activities Time to Deploy Activities 0 to 2 years 2 to 5 years 5 to 10 years (currently active) (prospective) (possible) Over 10 years (blue sky) Underground Mining - Indirect Ventilation Air Methane (VAM) Mitigation 1. Improved Underground Measurement Methods (including stockpiles) 2. Improved Ventilation Design and Practices 3. Improved Target Seam PreDrainage 4. Improved Non-Target Seam PreDrainage Underground Mining - Direct VAM Mitigation 6. Safety Systems For Use With High Temperature VAM Mitigation Methods 7. Thermal Flow Reversal Reactor (TFRR) 8. Catalyst Enhanced Thermal Flow Reversal Reactor (CHTFRR of CFRR) 9. Combustion Air for Co-Firing 10. Catalytic Gas Turbine 11. Methane Concentrator 12. Biological Methods Open Cut Mining 13. Improved Open Cut Measurement Methods 14. Improved Open Cut Drainage Deployment Readiness 5. Improved Post Mining or Goaf Drainage