Next generation coal blending boosts bottom line

Suzanne Shea, Praxis Engineers Inc.

TransAlta Utilities’ Keephills Generating Station near Edmonton, Alberta, was looking for a way to reduce an opacity and derate problem when they decided to evaluate a different strategy: advanced coal-blending technology. After testing and then full implementation, utility operators were more than pleased with the results a year later-over $2 million in increased revenue, with significant reduction in fuel-related derates. The program has been so successful that TransAlta, owner and operator of 8,000 MW of generation in North America, Australia and New Zealand, installed coal-blending technology at another plant in Washington state, where savings are expected to be $2 million annually.

The concept of coal blending has come a long way since the early days of the utility industry. Before the competitive pressures of deregulation and environmental legislation, coal-fired power plants burned a single, static blend of fuel to avoid all quality-related availability problems-without regard to cost or changing market conditions. Until recently, most coal yard operators were also loathe to consider the increased operational complexity necessary for old-fashioned pile blending.

But as market forces change the competitive landscape, utilities are looking at coal-blending techniques as a strategic way to significantly improve profitability, streamline the coal yard supply chain, and rapidly resolve problems as they arise. Generators who have installed advanced coal-blending technology are routinely saving more than $1 million per 1,000 MWh-a cost reduction unachievable just a few years ago.

Leveraging fluctuating fuel prices

From a strategic standpoint, coal blending enables operators to fundamentally shift their focus from purchasing or creating a single, “static blend,” to dynamically adjusting between multiple “best” blend options depending on current load, market conditions and operating conditions. The result is that operators can increase the types of fuels used in boilers to take advantage of fluctuating prices on the spot market for coals of differing qualities. Plants, for example, can burn less expensive western coals when power demand is low, and conversely use higher-quality fuels at peak power demand to significantly improve margins. In fact, a reduction of 5 cents per million Btu in coal costs-readily attainable using dynamic coal blending-can cut fuel costs by 3 to 5 percent. Coal blending gives operators the power to use the right fuels at the right time and measurably improve the bottom line in the process.

It’s important to note that the financial benefits of deploying advanced coal-blending technology now far offset the costs of additional coal handling. Using dynamic blending, the majority of fuel mixing takes place in mill bunkers in a controlled way, designed to match coal quality at the burner tip to operating and market conditions in real time. As a result, coal blending is helping transform the coal yard by producing significant cost reductions for the simplest operations to the most complex.

An equally important benefit of coal blending is that it can help remediate other coal-related issues at the plant, such as SO2 or NOx emissions, as well as occurrences of high opacity or slagging. Dynamic real-time coal blending allows operators to proactively blend high- and low-sulfur fuels without exceeding SO2 limits, potentially eliminating the need to purchase high-priced clean technology such as scrubbers. At the same time, coal-blending techniques enable plants to blend in cheaper, lower-quality coals at night when load typically drops, while still keeping below an imposed emission constraint.

Next-generation coal blending

Coal blending continues to gain momentum as executives learn more about how it works. Dynamic coal blending can actually be viewed as a two-part process, composed of coal-yard tracking (including bunker flow analysis) and blend recommendations intended to reduce costs and match constraints for the projected operating conditions. The following is a brief description of both parts of the process:

  • Coal-yard tracking monitors coal from the point of receipt through the yard into the bunkers and through to the burners. By providing tracking capabilities, operators can see the coal quantity and quality in the piles and bunkers in real time-a capability they didn’t have previously. To do this well, a detailed bunker flow analysis is needed to account for the complex mixing that occurs within a bunker. This is essential for providing accurate, real-time coal quality at the burner tips. In addition to providing information required for making blending decisions, bunker modeling allows operators to always be aware of the availability of various coals above each mill. It also provides advance notice when problem coals will arrive at the boiler.
  • Blend recommendations provide real-time advice on how to load the bunkers to ensure that the right coal gets to the boiler at the right time, based on the data provided by the coal tracking. The determination of what is the best coal is dependent on projections for boiler operations, as well as market conditions. The optimal blend produces the required power without derate, while minimizing coal-related costs and problems, including emissions.

Coal is the most abundant source of fossil fuel-based energy for electricity generation. In the United States alone, demand for coal energy has doubled since 1977 and demand for coal used for electricity generation in developing nations is projected to double by 2020. As deregulation changes the economics of energy production, operators have an outstanding opportunity to measurably improve profitability as well as the entire coal yard supply chain. For the industry to realize these opportunities, coal blending must be a strategic part of their approach.


Shea is executive vice president and co-founder of Praxis Engineers Inc. in Milpitas, Calif., a market leader in coal-blending technology. She can be reached at suzanne@praxisengineers.com.

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