Coal-to-liquids: A Boon or a Boondoggle?
Abstract
Crude oil is the single biggest energy resource for the transporta-
tion industry. The high cost of gasoline and instability in the Middle
East has recently resulted in more attention for fuel alternatives in the
United States for the existing fleet of vehicles. Biofuels such as ethanol
and biodiesel have received many tax incentives. More recently, coal-
to-liquids (CTL), a process by which coal is gasified and converted to
liquid fuel under high temperatures is being proposed as the route to
energy security. Several bills have been introduced in the Congress to
amend the Energy Policy Act of 2005. Among other provisions, these
bills would permit loan guarantees to certain large-scale CTL facilities,
offer tax credits for investment in CTL projects, and extend the alterna-
tive fuel credit for liquid fuels derived from coal. In this article, CTL is
reviewed with emphasis on the availability of the coal resource, status of
technology, its role in alleviating foreign oil dependence, and its role as
an enhanced emitter of greenhouse gases. Being a vast and distributed
resource, additional coal technologies will make welcome contributions
to our energy supply. However, given the cost and the long lead-time
in building large-scale CTL plants, the coal resource required for meet-
ing demand, and the environmental impacts of associated pollutants,
coal technologies must be promoted responsibly. To achieve greater
environmental credibility, nascent technologies such as carbon seques-
tration will have to be deployed in CTL plants. Ultimately, CTL must
be viewed as one part of a program that includes other aspects such as
increasing energy efficiency and promoting less carbon intensive renew-
able sources.
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