Increasing regulatory requirements and a focus on reducing carbon emissions in the U.S. have significantly reduced the number of new coal-fired plants under development compared with past years. In addition, projected capital costs for new coal-fired plants have risen sharply in the past year, while those for natural gas combined-cycle and combustion turbines have stayed relatively flat. In order to keep coal a viable energy source, many countries, including the U.S., are seeking ways to improve plant efficiency while reducing carbon emissions.

Coal-fired generation, both existing and proposed, is under heavy pressure to “clean up its act” if it wants to remain a viable fuel for power generation. The latest U.S. Energy Information Association (EIA) predictions of U.S. electricity generation estimate that the percentage of U.S. electricity generated by the combustion of coal will decline by 2%, from 45% to 43%, between 2009 and 2035 (Figure 1).

1. Electricity generation by fuel, 1990–2035. Data is shown as net electricity generation. Sources: Historical data from EIA, Annual Energy Review 2009; projections from National Energy Modeling System, run REF 2011, D120810C

The EIA Annual Energy Outlook 2011 (AEO) reference case estimates that 21 GW (supplied by approximately 30 to 35 new units) will be added during this roughly 25-year period and that coal will remain the dominant energy source in the absence of any federally mandated policy to reduce carbon emissions. Many industry observers consider this a “best-case” scenario, as the continued uncertainty over future emission regulations continues to dampen interest in committing to new coal-fired generation projects.

The AEO 2011 reference case also sees a heavy reliance on the existing coal-fired fleet to meet the nation’s electricity demand in future years. Undoubtedly, where possible, plant owners will continue making investments to improve the operating efficiency of the existing fleet. A pleasant side benefit of improved plant efficiency is a reduction in carbon dioxide emissions. However, as new generation comes online to meet the predicted increase in electricity demand, less-efficient older units that cannot be economically modified to meet more stringent emission requirements will likely be retired.

The Existing Coal-Fired Fleet

The current portfolio of coal-fired generation in the U.S. was a shade over 338 GW of installed nameplate capacity for 1,436 units at the end of 2009, the last full year for which EIA data is available. These units are generally conventional pulverized coal (PC) plants based on either subcritical (80% of the units) or supercritical (20%) boiler technology.

In general, three conventional boiler technologies are now available for new construction:

  • Subcritical steam generators operate at steam pressure less than the critical point of water—3,208 pounds per square inch (psi).
  • Conventional supercritical steam generators operate with steam pressure greater than 3,208 psi and steam temperatures generally in the 1,000F to 1,050F range.
  • Ultrasupercritical (USC) steam generators, the latest generation of advanced supercritical design units, operate at steam pressures greater than 3,208 psi and steam temperatures greater than 1,100F.

Currently, no USC units are operating in the U.S.; however, American Electric Power is building a 600-MW USC unit, scheduled for completion in late 2012, at the Turk site in Arkansas. (See “Designing an Ultrasupercritical Steam Turbine,” in the July 2009 issue or in the archives at

Follow the Data

The data source for our analysis of existing coal-fired plant cost and performance trends is Navigant’s proprietary Generation Knowledge Service, or GKS Fossil database. Data from 459 coal units totaling 165 GW of capacity was studied for the period 2005–2009. Non-fuel operations and maintenance (NFOM) cost data includes both expense and replacement capital. All data is subjected to a rigorous validation process to ensure data quality and comparability.

The database results are based on two important assumptions. First, all calculations are generation-weighted values (MWh, for example), not nameplate-weighted (MW). Also, plant efficiency over a defined period is based on the quotient of net generation converted (in Btu) and total fuel consumed,using the higher heating value (HHV) of the fuel, as is the convention in the U.S. Some countries use the lower heating value of the fuel to calculate plant thermal efficiency, which results in a higher value than when using the HHV. (See “Plant Efficiency: Begin with the Right Definitions,” February 2010.)

We begin our evaluation of cost and performance data for the existing PC fleet by first segmenting the large number of subcritical plants in the fleet into two groups based on nameplate capacity. Later in this article, we will use these data groupings, plus the existing supercritical data, as a starting point for predicting future cost and performance trends. The three plant data groupings used in this analysis are small subcritical PC units less than 500 MW, large subcritical PC units equal to or greater than 500 MW, and supercritical PC units equal to or greater than 500 MW.

As shown in Table 1, both the large subcritical and large supercritical units enjoy a significant NFOM cost advantage over small subcritical units, due primarily to the size advantages and higher capacity factors the larger plants enjoy. NFOM costs for supercritical units are on average about $0.90/MWh, or 12.8%, higher than for large subcritical units.

Availability factors are also higher for both sizes of subcritical units than for supercritical units; large subcritical units boast the highest availability numbers. Availability for supercritical units is more than 2% lower than for large subcritical units. It is not unusual for small subcritical units to run with lower availabilities than large subcritical ones, as asset owners tend to direct a larger portion of their financial resources to the more-efficient, higher-capacity-factor units. Though supercritical units tend to have slightly higher planned outage factors than large subcritical units, the major difference in availability is the higher forced outage rates experienced by supercritical units.

The major advantage of supercritical units is their higher cycle efficiencies. Table 1 also shows that supercritical unit efficiency is nearly 1.5% higher than that of large subcritical units and more than 2% higher than that of small subcritical units. Because the efficiency calculations used by the database are based on operating efficiency rather than performance test efficiency, the impact of start-ups and shutdowns, load following, and the like, are automatically factored into the data, which will appear as lower-than-expected design or baseload-type operation.

Table 1. Comparison of existing coal-fired technology performance metrics, using five-year average data (2005–2009). Plant efficiency is calculated using net generation divided by actual fuel consumed, thereby including the effects of plant cycling and load following. Source: Navigant

The impact of the general economic ma-laise over the past three years and increased reliance on gas-fired generation appears as a downward trend in capacity factor. These effects also compound to produce a net drop in average coal-fired plant operating efficiency over the same period (Figure 2). The net drop in average efficiency is greatest for supercritical units (–0.7%), followed by large subcritical units (–0.2%) and small subcritical units (–0.4%). This suggests that it may be more difficult for supercritical units to adapt to running at lower capacity factors than for subcritical units. This is an important point: The main advantage supercritical units have is their higher cycle efficiencies that more than balance out higher NFOM costs and lower operating availability compared with large subcritical units.

2. Existing coal-fired fleet performance trends, 2005–2009. Source: Navigant

Rising Capital Construction Costs

Capital costs for coal-fired generation are rising sharply. A review of recently completed projects employing both subcritical and supercritical technology is shown in Table 2.

Table 2. The installed cost for several recently completed coal-fired plants in the U.S. Source: Navigant

Despite a small sample size, the data in Table 2 provides a relative indication of recent capital construction costs for both types of units. For new-build units, the capital cost estimates provided in November 2010 by the EIA (based on estimates developed for it by external consultant R.W. Beck) are useful for showing the level to which costs are escalating, especially compared with alternatives such as gas-fired generation. Table 3 shows the EIA cost estimates for both single-unit and dual-unit advanced PC units, with and without carbon capture and sequestration (CCS), as well as an advanced natural gas combined-cycle (NGCC) unit for comparison.

Table 3. Estimates of new coal-fired plant construction costs show that costs will continue to rise. Source: Updated Capital Cost Estimates for Electricity Generation Plant, Energy Information Administration, Office of Energy Analysis, November 2010

Advanced PC technology consists of a conventional supercritical boiler operating at 3,700 psi and 1,050F steam conditions at the turbine inlet, single reheat, cooling tower, selective catalytic reduction, baghouse, and wet flue gas desulfurization (all advanced air quality control technologies). No estimates for subcritical boiler design were provided by the EIA. Although CCS technology is not specifically discussed in this article, it is important to note that estimates with the CCS option demonstrate how adding CCS impacts performance (+36% increase in heat rate, reflecting the huge auxiliary load increases) and installed cost (+61%).

Estimates for the single-unit advanced PC option are nearly double the average cost (shown in Table 2) for recently completed units ($3,167 vs. $1,679) and over three times the cost of advanced NGCC units ($3,167 vs. $1,003). Even more startling is the percentage change from the EIA’s previous year’s report: The cost of the coal option increased by 25% while the gas option rose by a meager 1%. According to the EIA, the updated costs for coal and nuclear power plants are 25% to 37% above those in AEO 2010. The higher cost estimates reflect many factors, including the overall trend of rising costs for capital-intensive technology in the power sector, higher global commodity prices, and the fact that there are relatively few construction firms with the ability to complete complex engineering projects such as a new nuclear or advanced coal power plant.

With costs for coal-fired units escalating at such a sharp rate, lower projected fuel costs for new natural gas plants, and continued regulatory uncertainty regarding carbon emissions, the economic advantage historically enjoyed by coal is vanishing quickly. This is one of the key reasons for the current significant effort and research focused on developing economically viable and environmentally acceptable clean coal technologies (such as integrated gasification combined-cycle), CCS, and improving the thermal efficiency of USC units.

Improving the Thermal Efficiency of New Units

Improving the thermal efficiency of new units produces more electricity from the same amount of coal. Given that utility-scale CCS technology is struggling to reach commercial scale, improving the efficiency of conventional technologies is the preferred option, especially internationally, to reduce carbon emissions while continuing to provde reliable electricity at competitive rates. Figure 3 illustrates the reduction in carbon emissions for the three steam generator technologies, which is generally a function of plant efficiency.

A 1% improvement in the efficiency of a PC-fired plant results in a 2% to 3% reduction in CO2 emissions. Most efforts at increasing steam cycle efficiencies are focused on increasing steam pressures and temperatures. USC plants installed today—with steam conditions of 4,350 psi, 1,112F superheat/reheat—have efficiencies as high as 44%. Figure 4 shows the progress made in developing and adopting advanced supercritical designs by those geographic regions now using or contemplating using USC plant designs.

3. The efficiency-emissions connection. Carbon dioxide emissions and coal-fired boiler combustion efficiency are closely linked. Note that a 1% increase in efficiency is equivalent to a 2% to 3% decrease in emissions. Source: IEA “Focus on Clean Coal” (2006)

Japan is clearly leading the way, followed closely by China and Europe, while the U.S. clearly is lagging behind. China has made tremendous investments in advanced supercritical design in recent years. Two of that country’s more recent projects are identified in Figure 4.

4. Rising steam. Tracking the steam conditions of supercritical coal-fired plant design by region shows rapid progress in Japan and China over the past few years. U.S. progress has been slower. Dotted lines indicate where the market is headed in terms of further improving USC technology for all countries. Source:

Further improvements in efficiency are dependent on the availability of new nickel-based alloys for the high temperatures and pressures in ultrasupercritical PC boilers. Two major development programs currently under way—the European Commission’s Thermie Project and a U.S. program managed by the Electric Power Research Institute for the U.S. Department of Energy and the Ohio Coal Development Office—aim to achieve steam parameters of 5,439 psi and 1,292F/1,328F and 5,500 psi and 1,346F/1,400F, respectively. (Efficiency increases approximately 1% for each 36F rise in superheat and reheat temperature.)

Lünen: State-of-the-Art Ultrasupercritical Plant

One current example of a state-of-the-art ultrasupercritical plant is the Lünen plant, located just outside of Lünen, Germany. It is an 800-MW unit burning international low-sulfur bituminous coal delivered by river barge. The estimated project cost is €1.4 billion—equivalent to an installed cost of $2,547/kW (2009 $). The plant, now under construction, is expected to enter service late in 2012. Some of the plant’s key technical features are listed in Table 4.

Table 4. Plant stats. Lünen Plant, a state-of-the-art ultrasupercritical coal-fired plant, is under construction in Germany and slated for a late 2012 start-up. Here are some of its key performance and technical features. Source: Navigant

In order to obtain the desired high efficiency at a reasonable costs, the Lünen plant designers focused on four specific areas: optimizing the combustion processes, increasing the steam parameters, reducing the condenser pressure, and improving the internal efficiency of the steam turbines. The Lünen plant’s USC steam generator combustion efficiency was also increased by:

  • Optimizing the steam generator heating surface arrangement.
  • Raising the final feedwater temperature to 586F.
  • Keeping the excess air coefficient in the firing system at less than 1.2.
  • Controlling the reheater outlet temperature without water injection.
  • Reducing the exhaust gas temperature downstream of the air preheater to 248F.
  • Minimizing steam- and gas-side pressure drops.

Perhaps just as interesting as the plant’s design features is the fact that the plant is being constructed in the European Union (EU), where utilities have a legal requirement to reduce carbon emissions. However, instead of eliminating coal as a power generation fuel, the EU (and Japan, too) replaces older, less-efficient coal plants with new, high-efficiency coal plants that produce a net decrease in carbon emissions. (See “Isogo Thermal Power Station Unit 2,” October 2010 for a good example of this replacement process.)

Coal’s Future

Coal is sure to play a continuing and vital role in meeting the world’s future electricity needs. However, increasing global political pressure to reduce carbon emissions may severely diminish coal’s favored status going forward. Clean coal technologies, such as integrated gasification combined-cycle and CCS, are under development but have yet to prove their technical or commercial viability. In the meantime, global electricity demand is increasing, and so is interest in advanced coal-fired plant designs, such as the Lünen USC plant.

Dale Probasco is a managing director with Navigant’s Energy Practice and can be reached at [email protected]. Bob Ruhlman is an associate director with Navigant’s Energy Practice and can be reached at [email protected].