Thread by @pretentiouswhat

How are the global energy crisis and massive development of renewables forcing Chinese coal plants to become the most advanced in the world?

(Also, the story of the brilliant engineer with no high school degree who is leading the effort)

A long thread. 🧵

Throughout this piece, I will be referring frequently to a recent article published in China Power Management Magazine that did a deep dive on this topic.

If you want to skip my Twitter pop coverage of this topic and just read the (more technical) article, link's at the end.

Okay, so first, 2022 has been another miserable year for China's coal-fired power plants.

Coal prices aren't as crazy as they were last year, but still high.
The power price cap is higher than it was last year, but still too low.

The losses for coal generators have been huge.

Not EVERY plant is losing money of course. e.g., inland plants closer to Chinese coal mines are more likely to be doing ok, since transport costs are lower.

But coastal plants are most likely in pain.

Huaneng by itself reported 3.9 billion CNY (565M USD) in losses over Q1-3.

The (mostly state-owned) coal generators are being forced to shield industry (and thus, consumers of Chinese goods) from the true impact of the energy crisis.

They pass some small bits, but for the most part, they are just absorbing billions in losses.

https://twitter.com/pretentiouswhat/status/1589817091540275200?s=20&t=jsixIbMF_7WtlGCaahWE6Q

The situation is what people in the coal industry grimly summarize as: "the more you generate, the more you lose".

But just shutting off the plant and not generating isn't an option...not after what happened last year with the power outages.

What's a coal plant to do?

Well, you can lobby for lower coal price benchmarks or higher power prices, but at the end of the day, that's up to the NDRC and NEA.

What you can do yourself as a coal generator is:

- Make sure your plant is as efficient as possible
- Try to find a different way to make money

Here's where our star engineer comes in. Professor Feng Weizhong is one of the most well-respected coal plant efficiency experts in China and even in the world.

He co-authored the article in the China Power Management magazine that inspired me to write this thread.

The picture in the tweet above is taken from a glowing AFR piece about Professor Feng from 2017, in which he is called the "Thomas Edison of China."

Back in the day, Feng was quite open to talking to foreign media. This profile on him is fascinating:

afr.com/work-and-caree…

Feng has been in coal plants since he was sent to work at one at the age of 16 during the CR. He became GM of that plant by the age of 29, despite having only a primary school education.

Now he's the vice-chairman of SH Waigaoqiao Power Station, one of the most efficient in CN.

When we talk about plant efficiency, we are asking, IN VERY BASIC TERMS:

"When we burn coal for power, how much electricity is created, vs how much energy potential the coal had in total?"

The US average coal plant efficiency is ~33%, typical for the global average.

Another way to look at this, if you are specifically thinking about plant economics during times of expensive coal, is:

"How many grams of coal do we need to generate one kWh of electricity?"

In the US, the annual avg. is ~508 g/kWh (or 1.12 lbs/kWh)

In China (or Japan) which operates a fleet of much newer and more efficient plants than the US, the average is much lower, closer to 300 gce/kWh.

But, as Feng Weizhong points out in his article, this is only barely good enough to cover costs when coal is 1200 CNY/ton.

So a solution, from a technical perspective, is to build more advanced coal plants that can still be profitable even at higher coal price levels, because they don't need as much coal per unit of output.

Feng and his team are on the absolute cutting edge of what is possible here.

At the new ultra supercritical Pingshan Phase II, they almost hit 50% efficiency (~246 gce/kWh), half the avg. level in the US, and a contender for most efficient plant in the world.

Feng has been gaining mainstream and industry accolades for this work since at least 2010.

Feng says in his article that he sees little hope for coal prices to return to 1000 CNY/MT in the near future.

So while NEW Chinese coal plants with a mandated efficiency of at least 270 gce/kWh are likely okay from a profit perspective, older plants need retrofits.

And it's possible!

Power Technology mag did a great profile back in 2020 of the work Feng's team did on a coal plant in Xuzhou, retrofitting an older plant to achieve 43.5% efficiency, lowing its coal usage from 318gce/kWh to <285 gce/kWh.

powermag.com/xuzhou-3-shows…

The 2020 Xuzhou retrofit cost ~50M USD.

I wonder how much they've saved on fuel in 2021-2022? They probably feel like geniuses.

So...that's the first way a plant can improve profitability - retrofit boilers, turbines, or generators to use less coal for the same power output.

The second solution I mentioned above was "try to find a different way to make money".

I am specifically referring to ramping of the plant's power level, so it may be used for flex generation.

This is not something coal plants normally do, but with retrofits, it's possible.

Feng specifically mentions in his piece how increasing penetration of renewables in China's grid is creating a growing market for flexible generation.

When the sun/wind goes away, something else needs to take its place, quickly. Pumped hydro or gas are most common worldwide.

The flex generator that comes online to follow the wind/solar isn't just earning money for power sold; it's also earning revenue in the ancillary services market for providing flexibility.

In China, the beneficiary of the flex service (the RE generator) compensates the supplier.

So, this is the other way for a coal plant to make money. Feng says gas is too expensive, batteries are unsustainable, hydro is almost tapped out, so China must use coal for flexibility.

Ramping coal like this is not usually good for the plant if they weren't designed for it.

But they can be retrofit. This is another area in which Feng and his team are leading China to lead the world.

New coal plants approved in CN these days already have to be designed to ramp down to as low as 30% load if needed, to be flexible generators.

https://twitter.com/pretentiouswhat/status/1586888273909395456?s=20&t=jsixIbMF_7WtlGCaahWE6Q

But Feng and his team have gone way beyond that. In the case study cited in Xuzhou, the retrofit coal plant is now capable of ramping down to as low at 19% load, allowing it to use as little fuel as possible while it waits to ramp up (e.g. in the evening when solar goes away).

I know a long thread about coal plants isn't exactly the sexiest topic for people who are used to hearing me talk about renewables or nuclear.

But the fact remains that coal is still the backbone of the Chinese generating fleet, and these upgrades are incredibly important.

If you consider the sheer volume of CO2 emissions that have been avoided by the efforts of the Chinese coal industry to improve efficiency, it's really no less of a climate accomplishment than what has been achieved by building wind or solar or nuclear.

China is still YEARS away from being able to leave behind the conventions of "baseload plants" and "peaking plants" for: "whatever is cheapest/low-carbon in the system right now is the right plant".

But these subtle improvements are part of that journey.

Very soon, China won't be able to build any more coal, but the battle for the flexibility market has just started.

Whether it's coal, nuclear, batteries, gas, or another thing that most cost-effectively provides the flexibility for the renewables...this is an open question.

My personal inclination, or maybe it's just a hope, is that of all the options, nuclear will be in a very strong position to fill that role.

I would look for new Chinese nuclear plants to be explicitly designed for flexibility and ramping, the way the French fleet is used.

As for Feng Weizhong himself...what a cool guy.

The world owes so much to these super-dedicated obsessives, who spend their WHOLE lives trying to figure out how to get 10% more chips on a circuit board, or 10% more rice from an acre, or 10% more electricity from a chunk of coal.

The Feng Weizhong + Mao Jianxiong article I have referenced throughout this thread is much more thorough, and can be found in the original Chinese at

news.bjx.com.cn/html/20221117/…

English version here. Translation errors 100% mine:

pastebin.com/as9z87Qm

A correction:

*Thermal efficiency would be about 50% higher than the average level in the US (33% vs. 50%)

Direct comparison of average gce for US vs. China is hard, as the average weighted calorific value of the coal consumed in each country is different, and not defined.