The case for carbon

Why Southern Company’s Chris Hobson believes clean coal should be part of our future energy mix.

“Renewables today cannot pierce even that intermediate level, and certainly not the base load generation. You can’t dispatch those units because you don’t know when the wind is going to blow. You don’t know when the sun is going to shine”
-Chris Hobson

One of the more contentious issues currently under examination in the renewables sector is the concept of clean coal and carbon sequestration. There are those who view clean coal with suspicion, but Southern Company’s Chris Hobson believes it is an essential area to pursue. To this end, the company has been working with the DOE for 15 years to develop an integrated gasification combined cycle power plant for coal, which Hobson says is one of the three or four most significant technology steps the industry can take.

"There is great promise in technologies around traditional pulverized coal because of advancements that are being made in materials of construction - efficiencies that are being built into the process now - so I don't want to discount those, but clearly from our perspective we see the gasification of coal as probably the most important technology advancement on clean coal that can be made."

Hobson, who is Southern Company's Senior Vice President for Research and Environmental Affairs, points out that 'clean coal' is a phrase that's been around for a decade or more and has meant different things at different times. For instance, when the Clean Air Amendment Act was passed in 1990, the focus was on traditional pollutants such as SO2 and NO2 and mercury. Back then the industry used the term to talk about the technologies that would be used to comply with that act.

"Since then," Hobson says, "the meaning of clean coal has been broadened to include technology advancements on the traditional pollutants, and also carbon dioxide. So clean coal to me is all about reducing the environmental footprint of coal to the extent that you can, and the next step for that is the technologies that are around carbon capturing sequestration. This integrated gasification combined cycle is a huge technology step towards clean coal, as are the technology advances we are seeing in the capture of carbon dioxide. We are the leader in the United States in the electric utility industry in both IGCC technology advancement and in carbon capture sequestration advancement."

Environmental groups often accuse big utility companies of being all talk and no action on clean coal, adding that in any case the money would be better spent on developing renewable energy sources. Hobson, like many in the industry, insists that we need both, and that it is naïve to believe otherwise. He pours scorn on those who insist we can meet our future energy needs solely from sources like sun, wind and hydro.

"To take that position indicates to me that they really don't understand the role of renewables in the energy infrastructure in the United States, or worldwide," he asserts. "Of course, there will be huge technology advancements made in renewables too, so what is true today might not be true 20 years down the road.

"But right now the whole electricity energy infrastructure is built on base load generation - the generation that people expect to be operating 24 hours a day, 365 days a year. Then you build an infrastructure around that base load, which will take care of those periods of time when you are seeing increased loads. So we go from base load generation to the intermediate plants. They might not run 24/7, but they run as needed.

"Then you move to that class of units called the peaking units, which operate in the highest demand periods. Renewables today cannot pierce even that intermediate level, and certainly not the base load generation. The availability is not good, the cost is not good. You can't dispatch those units because you don't know when the wind is going to blow. You don't know when the sun is going to shine.

"So while renewables will be valuable to us and will have a role to play, to say that we should not be investing in clean coal in order to be investing in renewables is to misunderstand the role of coal and the role of renewables. We should be working on those things together. I can't stop investing in coal research and in coal power plants simply to divert my capital funds over to renewables. we won't have an energy infrastructure that works if we do that."

Government role

The idea of renewable energy is so much in the spotlight these days that it has become hard to ignore. The Obama Administration has played a big role in this popularity explosion, with political attention and stimulus bill money helping to whip up interest across the country. But should it be up to federal policymakers to decide our energy future?

Southern Company's Chris Hobson believes the government does have a role to play, within certain limits. "It is their responsibility to set some trajectories both around technology and around environmental standards," he says. "When those come together sometimes there are conflicts, but that is a legitimate role for the federal government. As long as you are dealing with technologies that are well understood and can be deployed throughout the country, having those trajectories set by the government is a good thing.

However, he does not believe this applies in the case of renewable energy. "Renewable energy," he says, "unlike coal and natural gas and nuclear, has a lot of technical issues associated with it, and one of the most important of those is that not every region of the country has the resources to deploy renewables in the same manner.

"For instance, to state the obvious, the southwestern part of the United States has a lot of desert and many days of sunshine, which is a good environment in which to develop solar technologies. The midwest and the upper midwest have terrific wind resources. The southeast has none of those, and the midwest does not necessarily have real solar options either, so to try to set a one-size-fits-all renewable energy strategy without regard for regional differences in resources is not the right thing to do. While it might be appropriate for the federal government to set a trajectory for the use of renewables in the future, they need to then turn leave it up to each region of the country or each state to determine what is the best mix and what is the best level of penetration for them."

Hobson knows whereof he speaks. His team deals with issues relating to environmental policy, as well as legislative and regulatory challenges on a national level, and he also oversees a research organization that scours the universe of technology developers to find those technologies that will have some applicability to the company's business.

"Sometimes we have to go find those and sometimes they come and find us," he says. "When we do find something that has promise we work with the developer to put their technology into real world applications through pilot projects at our power plant, and help them take that technology to the next level so that it can be commercialized. We don't do that for profit. We do that so we can better understand the applicability of technology to our business."

The second section within the research organization is focused on two things, the first of which is the next generation of fossil technology. "We have developed our own integrated gasification combined cycle technology and we are deploying it now," Hobson continues. "We've done that in conjunction with the Department of Energy and other industrial partners.

"Because we are ready to go with the commercialization of technology, in conjunction with the DOE we are converting that to be the Department of Energy's National Carbon Capture Center. A lot of carbon capture work is being done in laboratories, at universities and in other companies or in the national labs that the DOE operates. By contrast, what we're trying to do is provide a real-world operating environment to which we can bring those technologies and demonstrate whether or not they have promise."

Cleaning up

According to Hobson, Southern Company is deploying more environmentally friendly power generation methods across the board. "We have under way two advanced nuclear units that we are working through the process on," he explains. "We have begun site work and we have received certification from the Public Service Commission in the state of Georgia. The Public Service Commission is the financial regulatory arm of the state government; they approve our integrated resource planning process, which is where we take a look at the need and come to an agreement with the public service commission on what that need will be like over time.

"We then agree on what technologies best fit that, and we have received approval from the state of Georgia to proceed with those nuclear units. That means ultimately you would be able to recover the cost of them, so we're excited about that. We have a certification for an integrated gasification combined cycle (IGCC) power plant in front of the Mississippi Public Service Commission that will use Mississippi lignite and will capture 65 percent of the carbon dioxide. It will be the most advanced coal-fired power plant, maybe in the whole world but certainly in the United States, because of its advanced coal technology plus its unique environmental footprint. No power plant of this kind will be capturing that much CO2.

"We are also converting one of our coal-fired power plants in Georgia to be operated on 100 percent biomass. Biomass is probably our best renewable opportunity, and this will be the largest biomass-fired power plant in the United States when we have it converted and operating. Then we have been deploying natural gas combined cycles over the last decade, and so we have been touching all the different supply side technology."

Even with current efforts to cut back and increase efficiency, the world's appetite for energy will likely continue to rise. What role does Hobson think the government should take in providing incentives for companies to develop technology to meet this future demand?

"In the situation we are in now, the government has to be a partner in this R&D work," he says. "Clearly one of the most important things they do is provide funding for research projects, and the DOE has a very good and a very robust research and development program around energy issues and companies all across the country take advantage of those financial resources, but the DOE is also an important partner in that they bring a great deal of expertise to the issue. They have national labs around the country. They have the National Energy Technology lab in Pittsburgh, where they have highly trained experts who understand these technology issues as we do.

"The DOE and the federal government can provide, but the DOE is also a valuable partner on the technology knowledge side. They need to continue to provide incentives for the development of this technology. What we saw in the Waxman-Markey bill were incentives for early deployment of some of these technologies, which is a natural next step. You helped incentivize the research and now let's help incentivize the deployment of this technology. There is a very important role for the federal government and I think they understand that role and are fulfilling it."

Another crucial question revolves around how utilities can be regulated to protect consumer energy costs if a cap and trade system is introduced. Hobson says government incentives will help defray costs for the most expensive power plan technologies, which will help protect consumers. "One of the key things they could do is to allow the market to work in reducing CO2," he continues. "There has been a lot of talk about this being a cap-and-trade system and a market-based approach, and the truth is they put this definition out there around the market, but then the legislation constrains it so badly that if it were implemented, it would not allow the market to work freely.

"We found out from our experience with the 1990 Clean Air Amendment Act that the market will work, and so the best thing they can do to help protect consumers is to, one, allow the market to dictate the price of carbon and then drive the technologies that get developed and deployed; and then secondly, continue to provide incentives for early movers to help with that push and pull of technology.

"One of the things that is critical from the legislation that's been out there so far is that we are not yet appropriately connecting the dots between the targets and the timetables we are setting and the availability of technology. The federal government in setting climate policy must keep in mind and must have a clear vision of what technology can do and what it can't do.

"Then maybe over time, we could have that process of evaluating technologies and how that might affect targets and timetables; have that be a robust, iterative process, so that maybe every five years you have a reassessment of technology and then a new set of targets and timetables for deploying that technology, and then you can set targets for CO2 based on that. But if we go out and set targets and timetables and don't have the availability of technology in our minds, we will make some horribly inefficient and uneconomical choices."

Chris Hobson is Senior Vice President, Research and Environmental Affairs and Chief Environmental Officer for Southern Company.