Articals of interest to the coal industry.

Sunday, June 03, 2007

Air Force and Ky coal

Coal States See Boon in USAF Alt-Fuel Push

Coal dug from deep in Kentucky’s rugged mountains generates some $4 billion a year for the state’s economy, helping to lift it to the position of ninth-poorest among the 50 United States.
With 120 million tons mined in 2006, Kentucky coal production is down from its peak of 180 million tons in 1990. But a new customer for Kentucky coal could bring an economic boost to the beleaguered state.
And Rep. Geoff Davis, R-Ky., thinks he has found that customer — the U.S. Air Force.
A Davis amendment to the 2008 Defense Authorization Act would give the Air Force $10 million to accelerate testing of jet fuel made from coal.
In 2006, the service tested coal-based synthetic fuel and ultimately flew a B-52 bomber on a blend of standard jet fuel and the coal-based liquid.
The Air Force plans to begin testing the fuel soon in a C-17 cargo plane, a service spokeswoman said.
Davis hopes that once the Air Force adopts coal-based jet fuel, so will commercial airlines. The potential benefits are broader than just more jobs and increased income for his home state.
“Kentucky has the unique opportunity to be part of the solution to our nation’s energy crisis by turning coal into liquid fuel,” the congressman said.
The Air Force may be essential to Kentucky’s success.
It will take billions of dollars to build a “coal-to-liquid” plant able to meet the Air Force’s fuel needs. It would cost many times that much to meet airline needs. No one is willing to make that investment unless there is an assured, profitable market for the synthetic fuel.
But no market will develop until there are plants turning out fuel.
Davis’ answer is the Air Force.
“The Department of Defense is the single largest consumer of fuel in the United States and the Air Force consumes over 50 percent of the fuel used by the military,” he said.
Seeking Reliable Supply
The Air Force burns 2.6 billion gallons of jet fuel a year, said Paul Bollinger, special assistant to the service’s assistant secretary for installations, environment and logistics. Ensuring that it has a reliable fuel supply is a key Air Force concern, he said.
The Air Force hopes to spend $38 million on synthetic fuel research and testing in 2008, but only $1 million was requested in the 2008. The remainder is an “unfunded priority,” Bollinger said. So the $10 million in Davis’ amendment is significant.
If the Air Force becomes a reliable synthetic fuel consumer, that could justify investment in coal-to-liquid plants, which could, in turn, “accelerate development of the technology and production capacity needed for large-scale commercial deployment of this type of alternative fuel,” Davis’ amendment says.
To push the Air Force further in that direction, Davis proposed a separate amendment permitting the service to sign purchasing contracts lasting as long as 25 years for buying coal-based fuel.
However, Davis withdrew that amendment after being told that House budgeting rules would count its cost as “mandatory spending” that would have to be offset by cutting an equal amount of money elsewhere in the budget. “We did not have an offset to offer,” a Davis aide said.
Davis isn’t alone in this endeavor.
In January, he and another coal-state congressman, Rep. Nick Rahall, D-W.Va., introduced the Coal-to-Liquids Fuel Promotion Act of 2007.
The legislation would provide tax breaks and loan guarantees for building coal-to-liquid plants. That bill, which also contains coal-to-liquid research money for the Air Force and authority to sign 25-year fuel purchase contracts, awaits committee action.
A similar bill was introduced in the Senate by Sens. Jim Bunning, R-Ky., and Barak Obama, D-Ill. Illinois produced about 32 million tons of coal in 2005.
Environmental Concerns
Growing support for coal-to-liquid fuel is sparking alarm among environmentalists, who warn that the fuel and the process that makes it produce twice as much carbon dioxide as petroleum-based fuel. That makes coal-to-liquid — or CTL — disastrous for global warming, said Alice McKeown of the Sierra Club.
Using more coal also means more strip mining, which environmentalists say is destroying the landscape in Kentucky, West Virginia and elsewhere. And the CTL process consumes prodigious amounts of water.
“We think it’s misguided. It’s not really a smart solution for our energy future,” McKeown said. “We should not be using government money to jumpstart this industry.”
Other government action, such as increasing the mileage requirements on automobiles, would reduce petroleum consumption, which would be environmentally beneficial and make more fuel available to the Air Force, she said.
Bollinger said the Air Force is very conscious of the possible environmental impacts of producing liquid fuel from coal.
“Our secretary has stated from day one that we are going to be good environmental stewards,” he said. “I’ve done an extensive amount of work with other agencies that control and regulate these areas.”
The carbon dioxide produced by the CTL can be captured and sequestered — essentially buried deep underground. Coal can be mixed with biomass to reduce the net CO2 output of the process and mining can be done in environmentally benign ways, he said.
Davis, too, says he is “committed to ensuring the environmental integrity of these fuels and have advocated that any future fuels produced from coal are as good or better than the environmental footprint of the fuels they are designed to replace.”
But the matters of national security and the economy cannot be disregarded, he said. The nation cannot afford to ignore the potential of coal, considering the absence of viable alternatives, he said. •

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