China, People's Republic of: Study on Carbon Capture and Storage in Natural Gas-Based Power Plants

Sovereign Project | 45096-001

Summary

The Department of Climate Change in National Development and Reform Commission of PRC recognizes the potential of long-term strategic importance of CCS in the national climate change agenda and supports the request of Datang International Power Generation Co., Ltd. (Datang International) for a grant-financed capacity development technical assistance (CDTA) from Asian Development Bank (ADB). This CDTA will complement another ongoing ADB TA for an integrated gasification combined cycle power plant (IGCC) power plant. The proposed TA will provide critical strategic analysis that is needed in comparing various CCS options at this early stage of CCS development in PRC. In particular, it may provide options for feasibility of near-zero carbon dioxide emission power plants in urban locations that will be crucial to meet the rapidly growing heat and power capacity in future. The TA will also enhance the technical capacity of Datang International in carbon capture, transportation and storage technologies.

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Project Name Study on Carbon Capture and Storage in Natural Gas-Based Power Plants
Project Number 45096-001
Country China, People's Republic of
Project Status Approved
Project Type / Modality of Assistance Technical Assistance
Source of Funding / Amount
TA 8001-PRC: Study on Carbon Capture and Storage in Natural Gas-Based Power Plants
Carbon Capture and Storage Fund US$ 1.80 million
Strategic Agendas Environmentally sustainable growth
Inclusive economic growth
Drivers of Change Governance and capacity development
Partnerships
Sector / Subsector

Energy - Energy efficiency and conservation

Gender Equity and Mainstreaming No gender elements
Description The Department of Climate Change in National Development and Reform Commission of PRC recognizes the potential of long-term strategic importance of CCS in the national climate change agenda and supports the request of Datang International Power Generation Co., Ltd. (Datang International) for a grant-financed capacity development technical assistance (CDTA) from Asian Development Bank (ADB). This CDTA will complement another ongoing ADB TA for an integrated gasification combined cycle power plant (IGCC) power plant. The proposed TA will provide critical strategic analysis that is needed in comparing various CCS options at this early stage of CCS development in PRC. In particular, it may provide options for feasibility of near-zero carbon dioxide emission power plants in urban locations that will be crucial to meet the rapidly growing heat and power capacity in future. The TA will also enhance the technical capacity of Datang International in carbon capture, transportation and storage technologies. Currently, in PRC there is no government's policy and financial incentive commitments for CCS. In order to demonstrate a potential of CCS as a least-cost option for carbon dioxide abatement, developing a few CCS demonstration projects through 100% state owned enterprise like Datang International is an inevitable process. This TA's lessons learned will be a good reference and firm foundation to the government in establishing favorable policies on CCS deployment in PRC.
Project Rationale and Linkage to Country/Regional Strategy The energy intensity and carbon intensity reductions will continue to be key priorities in the energy sector in the PRC's Twelfth Plan. Based on the initial announcements, these targets are 16% and 17% respectively in the plan period. The decarbonization of fossil fuel power plants will be a critical priority to improve the carbon intensity of the electricity sector. The emerging priorities in the country partnership strategy 2011-2015 suggests that promoting resource efficiency and environmental sustainability will continue to be a major priority of ADB's assistance to the PRC. The CCS is a forward looking technology which is directly relevant to the power sector in the PRC. Early enabling preparation for CCS is essential for addressing global and domestic climate change and environmental challenges respectively. The TA has a close link with the country partnership strategy priority of environmental sustainability of the PRC's economic development.
Impact Accelerated application of CCS on natural gas-based power plants and "CCS ready" plants.
Project Outcome
Description of Outcome Enhanced capacity in planning, management and implementation of natural gas-based "CCS ready" plants.
Progress Toward Outcome

Key staff of the executing agency was trained in planning, arrangement, and implementation of natural gas-based CCS-ready plants through (a) the participation in key conferences , including the participation in the GHGT 11 in Kyoto from 19-22 November 2012, the Gobal Information and Planning Symposium hosted by SaskPower, Saskatchewan, Canada, and the Annual Meeting of the Global CCS Institute in October 2013; (b) a site visit to the Technology Center Mongstad; and (c) the capacity strengthening received from the consultant team.

The pilot project is being constructed and designed and the relevant staff from Gaojing plant is trained in its operation in the form of training on the job. It is expected to be completed by 2014.

The consultants conducted numerous discussions with the key staff on specific issues related to making Gaojing plant CCS-ready and the implementation of the CCS pilot project to be constructed at the Gaojing plant.

A CCS-Readiness assessment has been finalized to be included in the final report.

A CCS-Ready Policy Note has been prepared for the government as a knowledge product resulting from this technical assistance.

A CO2 Storage Capacity Assessment Manual has been prepared to serve as a general guideline for the stakeholders.

Implementation Progress
Description of Project Outputs

A CCS road map for natural gas-based power plants is prepared.

Compare, pilot test and select efficient and cost-effective CO2 capture technology

CCS readiness plan developed and financing needs identified for the Gaojing plant expansion.

Capacity assessed and strengthened for CCS-ready design and retrofit projects

Implemented a public outreach campaign.

Status of Implementation Progress (Outputs, Activities, and Issues)

The inception workshop was held on August 15, 2012 in Beijing. A comprehensive inception report has been produced and submitted in August 2012.

A comprehensive inception report has been produced and submitted in August 2012. In addition, the consultant has interim reports and the draft final reports timely. A Draft Final Workshop will be held on 8 October 2013.

The contract for the construction of the pilot project has been awarded in March 2013; its construction will start in the second quarter of 2013. The consultant team will closely work with the team from Datang International to support the pilot project's construction.

A CCS Readiness Assessment has been finalized by sub-contractors of the consultant, the North China Electric Power University.

The final report, CCS Readiness Assessment, and the result of the pilot project implementation were presented at the final workshop scheduled on 30 March 2015. The final workshop included a site visit to the Gaojing Combined Heat and Power Plant and the carbon capture pilot installed at the plant.

Datang International is committed to share test results of the pilot with key stakeholders.

Geographical Location
Summary of Environmental and Social Aspects
Environmental Aspects
Involuntary Resettlement
Indigenous Peoples
Stakeholder Communication, Participation, and Consultation
During Project Design
During Project Implementation

For the inception workshop, the EA/IA invited representatives from (i) key PRC energy companies, (ii) relevant governmental organizations; (iii) academia; (iv) non-governmental organizations; and (v) international organizations to be informed about the project's progress and to learn about the CCS-ready approach and its importance for the PRC's power sector in general and natural gas-based power plants in particular.

During the Draft Final Workshop, key stakeholders and researchers on the topic will be consulted on their views on CCS-ready.

Business Opportunities
Consulting Services The TA will require a total of 10 person-months of international consulting services and 49 person-months of national consulting services. Both international and national consultants will be experts in the following fields: (i) CO2 capture and storage strategy development; (ii) technical areas over the whole CCS value chain; (iii) energy economics; and (iv) financial modeling and analysis. ADB, in consultation with the executing agency will select and engage international and national consultants in accordance with ADB's Guidelines on the Use of Consultants (2010, as amended from time to time) using the quality-(80%) and cost-based (20%) selection method. The consulting firm will be required to submit a simplified technical proposal covering all aspects of the terms of reference.
Procurement Equipment purchased under the TA will be turned over to the executing agency after completion of the TA. They, with inputs from the consultants, will finalize the scope and content of the training and information dissemination programs. Financial arrangements for the training, workshops and surveys will be included in the consulting firm's contract. Disbursements under the TA will be conducted in accordance with the ADB's Technical Assistance Disbursement Handbook (May 2010, amended from time to time).
Responsible ADB Officer Annika Seiler
Responsible ADB Department East Asia Department
Responsible ADB Division Energy Division, EARD
Executing Agencies
Datang International Power Generation Co., Ltd.9 Guangningbo Street
Xicheng District, Beijing, PRC
Timetable
Concept Clearance 19 Aug 2011
Fact Finding 26 Jul 2011 to 27 Jul 2011
MRM -
Approval 12 Dec 2011
Last Review Mission -
Last PDS Update 31 Mar 2015

TA 8001-PRC

Milestones
Approval Signing Date Effectivity Date Closing
Original Revised Actual
12 Dec 2011 11 Jan 2012 11 Jan 2012 15 Aug 2013 13 May 2015 -
Financing Plan/TA Utilization Cumulative Disbursements
ADB Cofinancing Counterpart Total Date Amount
Gov Beneficiaries Project Sponsor Others
0.00 1,800,000.00 1,350,000.00 0.00 0.00 0.00 3,150,000.00 12 Dec 2011 1,422,038.66

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