From coal to gas. Part II

The cost of various energies in Western Canada are listed. Obviously it is cheapest to use coal directly. However, coal is a dirty fuel and transportation costs are high. Nevertheless, there are many environmentally acceptable ways to use it such as in district heating and in replacing industrial use of gas or oil in certain applications. But this still leaves other industrial, residential, and commercial uses for which direct use of coal is environmentally unacceptable. The present low price of natural gas will increase as conventional reserves deplete. In any event, synthetic energy costs should not be compared with today's prices but rather with incremental cost of obtaining new energy supplies. On the other hand, one can compare gas from coal with that of current prices of electricity from new nuclear and hydropower plants. These energies, along with electricity via coal, are expected to be available from the same sources in the near future. There is no doubt that electricity can be economically produced by low cost and low-sulfur western coal when compared with either a hydroelectric or a nuclear plant. However, SNG compares favorably with electricity via coal even at today's price in terms of energy available at themore » plant gate since the efficiency of conversion of coal to electricity is 35% versus 65% of that of coal to SNG. Owing to low efficiencies of producing electricty, use of SNG for electric generation would not be justifiable. Even in commercial and residential heating applications, the conversion efficiency of SNG to heat is only 50 to 60% compared to nearly 100% that for electricity. For end use as heat, SNG is thus expensive at today's cost of electricity via coal, although this may not be true in the near future. Medium Btu gas on the other hand is presently competitive with electric resistance heating. Some gasification processes also produce valuable by-product chemicals.« less