Govt Must Re-negotiate with India and go for a Natural Gas plant at Sampur

by Dr.Janaka Ratnasiri

The recent article by Dr Tilak Siyambalapitiya highlighting the delay in starting work on the Sampur coal power plant (CPP) prompted me to write this article.

This project was conceived several years ago to be executed in collaboration with India’s National Thermal Power Corporation of India (NTPC), a government owned company. The MOU for the project was signed between CEB and NTPC last September.

Initially, a 500 MW coal power plant will be built at Sampur, south of Koddiyar Bay. A high voltage DC link between Sampur and India to transfer power either way was also included in the project. However, as Dr TS has mentioned, the progress seem to have got stalled somewhere. According to CEB’s Long Term Generation Expansion (LTGE) Plan of 2011, two of 250 MW CPP are planned to be added to the grid by 2017 and another two coal plants each of 250 MW to be added in 2018 and 2019.

According to the political write up that appeared in Irida Lankadeepa on 01.07.12, Sampur project had been a topic that was included in the bilateral discussion between our Minister of Power and Energy Patali Champika Ranawaka and India’s Prime Minister Dr Manmohan Singh held last 21st in New Delhi. Dr Singh supposed to have inquired about the delay in the Sampur project, and apparently our own minister had to provide an explanation saying that the project was awaiting approval by the newly appointed board, appointed jointly by the two parties, India and Sri Lanka, and that the ball was now in India’s court. Mr. Singh is supposed to have instructed his officials to find out where the delay was and to get the project expedited.

Mr. Singh appears to be very much concerned that there is no delay in building a CPP in Sri Lanka. However, Dr. Singh’s action appears to be contradictory to the position that he took at the Climate Change Conference held in Copenhagen in 2009. India, along with 4 other countries authored the Copenhagen Accord which requires all countries to reduce their greenhouse gas (GHG) emissions. India therefore has no moral right to now tell Sri Lanka that we should go for coal to generate our electricity which will result in increasing the country’s emissions.

In keeping with the Copenhagen Accord co-authored by India, what India should be doing now is to promote introduction of natural gas to Sri Lanka instead of promoting coal. Perhaps, Dr Singh himself may be preoccupied to draw his attention to the details of Sri Lanka’s power situation, and what he has said during the discussion with our minister could be something based on a briefing given to him. His advisers should have known better to see that there is no inconsistency in what Dr Singh says at bilateral talks and at international fora.

The main agenda at the Copenhagen conference was the extension of the Kyoto Protocol under which the developed country Parties numbering 39 were required to reduce their GHG emissions by a percentage of about 5% during 2008-2012 below their 1990 emission levels. Many countries however have not complied with this requirement. Also, countries like USA withdrew from the Protocol saying that unless countries that are emitting large quantities like China and India are included in the scheme, they will not make any commitments to reduce emissions. These two countries as well as other large industrialized countries like Brazil and South Africa were exempted from the Protocol because their per capita emissions were small even though the gross emissions were high. At the first Conference of the Parties held in Berlin in 1995, Mr. Kamal Nath, Indian Minister of Environment said that in India, GHGs emitted were emissions of survival, while in the west, those were emissions of affluence. China and India want to maintain this distinction.

The climate scientists through the Intergovernmental Panel on Climate Change (IPCC) were in the meantime alerting the nations that at the present rate of emissions, very soon, global warming will get enhanced beyond the threshold causing irreparable damage to the world’s ecosystems, health of people, natural resources including scarce water resources and the climate in general. Hence there was general consensus among nations that the emission reduction targets should be further tightened and in fact there were several proposals in the agenda giving specific alternative enhanced targets. The parties generally had the feeling that the conference should agree on one or other of these options, other than of course USA who had expressed their reservations. China and other industrialized developing countries wanted only the developed countries to bear the responsibility though there was pressure from others that they too should do something.

The Conference till the last day could not come to an agreement on an acceptable alternative. Till that time the European Union and several other countries had expressed their agreement to undertake reduction to the extent of 20-30% below 1990 levels but there was no agreement on what the developing countries should be doing. As usually done in such situations, a small group of countries was named to have discussions behind closed doors and present their recommendation to the final plenary session.

This group included China, India, Brazil and South Africa. While they were having discussions, an unusual incident happened. An outsider broke into the meeting, and that was President Obama. With his rhetoric he was able to turn the discussions completely to his liking. He offered finances amounting to billions of dollars to developing countries enabling them to undertake emission reduction targets. He also suggested that even the developed countries should not commit to any binding targets meaning totally abolishing of the Kyoto Protocol, and even the EU agreed to this new development.

So, the five parties – China, India, Brazil, South Africa and USA came out with the Copenhagen Accord with the main theme that all parties – both developed and developing- voluntarily agreeing to set targets – both extent and time frame – for emission reductions and that these targets should be notified to the Convention Secretariat. The Accord when tabled at the final session was only taken note by Parties without formally adopting it. A very few countries however supported it before the session closed. Subsequently, many more countries had conveyed their consent with targets sent to the Secretariat because they feared that otherwise they may not become eligible for receiving funding.

India was thus a co-author of the Copenhagen Accord which required all countries to undertake reductions of emissions. A key sector of emissions is the power sector and most emissions come from burning of coal. Between a coal power plant and a natural gas power plant of similar capacity and plant factor, the latter emits 55% less CO2 than that from a coal plant. India, at this conference, was essentially telling the world community that they should not be using coal for electricity generation but instead use some other sources such as natural gas. So, now India cannot be telling us that we should use coal for power generation.

Leaving out what India is saying, there is another important aspect that Sri Lanka should be concerned about in deciding for coal power- that is its health impacts. I have written many a times on the undesirability of building a coal power plant at Sampur and that the government should build a natural power plant instead, in view of its many benefits which I have described in detail in these articles So, I do not want to go into details here.

Suffice to say that building CPPs both in the west and east coasts will cover the interior of the entire island with pollutants that will have serious impact on health of our people, particularly those living in the NW, NC and Eastern Provinces. This is really the rice bowl of the country, and these pollutants will have adverse impacts on cultivation too.

Though the bulk of the emissions get filtered, what gets released into the atmosphere is sufficient to cause damage to the environment and the health of the people. The two CPPs, one in Puttalam and the other in Sampur will complement each other in polluting the country. The SW monsoon winds from May to September will carry pollutants from the Puttalam CPP into the NW and NC Provinces, while during NE monsoon winds from December to February will carry pollutants from the Sampur CPP into the Eastern and NC Provinces. These pollutants will enhance the level of particulates, sulphur dioxide and oxides of nitrogen concentrations in air. People there will no longer be able to breathe any fresh clean air, and breathing polluted air will naturally increase the incidence of respiratory diseases among the children and elderly.

The total expenditure for health care in government hospitals in 2011 had been Rs. 74 billion (Central Bank Report, 2011). According to Health Ministry Bulletin, about 1/10 of all hospital admissions are for respiratory ailments. Since ailment-wise segregated data are not available, we have to assume that the expenditure on treatment for respiratory diseases across the country would be around Rs. 7 billion annually. If we assume that the operation of the 900 MW CPP at Puttalam and 1,000 MW CPPs at Sampur of coal plants within the next 5 – 7 years would definitely increase the level of air pollution in the country.

Currently, these are at very low level in the absence of any polluting industries in these regions except the two cement factories at Puttalam and Trincomalee. The enhanced pollution from CPPs will result in at least doubling the hospital admissions for respiratory diseases, and the country will have to bear an additional expenditure of about 10 billion of Rupees annually on this account. Here the key factor is not the extra expenditure, but the suffering of the people imposed on them unnecessarily.

There is another aspect of causing pollution in the NC and Eastern Provinces where chronic kidney disease (CKD) incidence and fatalities due to it are high. It was revealed in the media recently that a WHO team of scientists who had studied the occurrence of CKD in Sri Lanka has identified the presence of heavy metals such as cadmium, arsenic and lead in patients as well as in soil samples where the disease is prevalent.

It is well known that CPPs release heavy metals into the environment particularly mercury, nickel, chromium, lead and several others, though environment impact assessment studies done here on CPPs have not considered this aspect. Though the scientific link between the presence of heavy metals and incidence of CKD has not been established yet, the adverse impacts of heavy metals on human health in general are well known (WHO Publication on Air Quality Guidelines, 2000).

According to a publication of the International Energy Agency on Environmental and Health Impacts of Electricity Generation released in June 2002, one GWh of electricity generation by a CPP typically releases 117 g of mercury, 110 g of nickel, 114 g of chromium, 220 g of lead, 323 g of zinc, 76 g of arsenic, 29 g of cobalt and 5 g of cadmium. The 900 MW Puttalam CPP and the 1000 MW of Sampur CPP when in full operation will generate annually 6,300 GWh and 7,000 GWh of electricity, respectively. Therefore these two plants will jointly release annually 1.6 t of mercury, 1.5 t of nickel, 1.5 t of chromium, 2.9 t of lead, 4.3 t of zinc, 1.0 t of arsenic, 0.4 t of cobalt and 0.07 t of cadmium to the soil (see Figure).

If there is indeed a link between heavy metals and incidence of CKD, it would definitely enhance the prevalence of chronic kidney disease (CKD) within the exposed areas from coal power pollutants. This is over and above the current situation which has already reached epidemic level. The health authorities should urgently give their attention to this possible threat to the health of people from coal power plants and should alert the power sector authorities accordingly.

The Environmental Protection Agency (EPA) of USA, in order to arrest the increasing pollution due to the large number of thermal power plants, has issued on March 16, 2011 a new set of regulation that would reduce emissions of toxic air pollutants from power plants. These would reduce emissions from new and existing coal- and oil-fired electric utility steam generating units (EGUs). EPA is also proposing to revise the new source performance standards (NSPS) for fossil-fuel-fired EGUs. This NSPS would revise the standards new coal- and oil-fired power plants must meet for particulate matter (PM), sulfur dioxide (SO2), and nitrogen oxides (NOx).

The proposed toxics rule will also reduce emissions of heavy metals, including mercury, arsenic, chromium, and nickel, and acid gases, including hydrogen chloride and hydrogen fluoride. These toxic air pollutants, also known as hazardous air pollutants or air toxics, are known or suspected of causing cancer and other serious health effects. Coal power plants are responsible for 99 percent of mercury emissions, over 50 percent of acid gas emissions, and about 25 percent of toxic metal emissions in the United States. Mercury and lead can adversely affect developing brains – including effects on IQ, learning, and memory.

The new standards would reduce concentrations of fine particles (PM2.5) in the air. This will significantly prevent hundreds of thousands of illnesses and thousands of premature deaths each year. EPA estimates the health benefits associated with reduced exposure to fine particles are $59 billion to $140 billion in 2016 (2007$). EPA estimates the total national annual cost of this rule will be $10.9 billion in the year 2016.

There is another new important regulation on power plants that EPA has proposed. That is to limit the amount of CO2 emitted to 1000 lb or 454 kg per MWh of electricity generated. This would automatically rule out coal power plants unless their efficiency could be doubled, but this is technically not feasible at the moment. The obvious choice for future power generation in USA is therefore natural gas which can easily meet this standard.

The LTGE Plan of CEB which is generally released once in a few years, has for the first time included the LNG option in their latest release in 2011. This report first gives a base-case plan for adding new power plants on a least-cost option basis and their retirement. It then gives other options such as high-demand case, low-demand case and few other price-related options. This time, a new option of limiting coal to 1,000 MW and adding LNG plants beyond 1,000 MW has been included. The base-case plan has provided for the installation of 1,000 MW of CPP at Sampur and 1,800 MW of additional six CPPs, each of 300 MW capacity at sites yet to be selected. Under the LNG option case, the 1,800 MW new CPPs will be replaced with six LNG plants, each of 250 MW capacity to be added during 2021 – 2025.

The CEB’s LTGE plan has also given an estimate of costs of electricity production by different technologies and fuels in its Table 4.7, according to which the production of 1 kWh of electricity from a 250 MW coal plant will cost Rs. 8.00 when operated at 0.8 plant factor, while that from a LNG plant of similar capacity and plant factor will cost only Rs. 7.80. Hitherto, LNG was not included in CEB plans on the grounds that it was an expensive option and that the demand did not justify its import. But, now it appears that electricity from LNG is cheaper marginally, and if the estimates are done for a higher capacity, the price would come down further. Various studies done in the west have shown that the costs of externalities are about twice as much as for coal than for NG, and if these are also added to the specific production costs, the price difference will be very significant.

If the cost of electricity from LNG is cheaper than from coal, and if it does not produce any pollution whatsoever be it particulates or sulphur dioxides or heavy metals all of which have adverse health impacts, there is absolutely no reason why we should pursue the Sampur CPP just to satisfy India’s interests. It can be easily replaced with LNG power plants and if we work on a fast track basis, the first plant could be commissioned by 2017. What we should give priority is the health of our people and not the interests of India’s power sector. When there is an economically viable totally clean option available, any decision maker here trying to promote dirty coal power is just out of his mind. For somebody’s foolishness, people will have to suffer.

It is a pity that Minister Ranawaka missed the opportunity to apprise Dr Singh about the advantage of shifting from coal to natural gas for the Sampur power plant enabling Sri Lanka to reduce her emissions, when Dr Singh brought up this issue. Minister Ranawaka has attended several Climate Change Conferences including even the last one at Durban, South Africa (though while not holding environment portfolio) and should be well aware of the pressure on developing countries to reduce emissions, which was the main theme of the talks.

The country could benefit from his attending these talks if he takes measures after returning to the country that would fall in line with the decisions taken at the meeting. Minister Ranawaka has already demonstrated his continued interest in environmental matters by attending these climate change talks. Though he has switched his portfolio, he could go a step further and establish himself as a savior of our environment by doing away with coal for the future power plants planned by CEB including the Sampur plant and using LNG instead.

As the minister in charge of the Energy and Power portfolio, Minister Ranawaka could persuade the Indian collaborator to build a moderate size LNG terminal at Trincomalee for exporting the surplus gas to India (as described in my previous article on Energy Hub in Trincomalee) after meeting Sri Lanka’s requirements. India too could benefit from investing on the project as India could claim any carbon credits earned through shifting from coal to natural gas.

It is a win-win situation for both countries. It is still not too late to renegotiate with India and go for a natural gas plant at Sampur. The government should do this for the sake of future generations.