Japanese company JGC Corp. intends to manufacture a coal-based fuel for power plants that is expected to cost 30-50% less than fuel oil, beginning production in Indonesia in 2015.
Low-grade coal has high moisture content and does not burn easily. JGC intends to convert this t useful fuel by removing the moisture by subjecting the pulverised coal to high temperatures and pressures. After further treatment including the injection of suitable additives the resulting liquid fuel yields roughly the same heat value as fuel oil when burned and can replace it in conventional power plants.
JGC plans to spend about 30 billion yen to build a production facility in Indonesia, which has large deposits of low-grade coal. The facility is expected to have an annual output of about 1 million tons – enough fuel to keep a typical 300 MW power plant running. Production may be raised to an annual 10 million tons or more, depending on demand.
Japan's fossil-fuel-fired power plants used 10.16 million tons of fuel oil in fiscal 2011, up 88% from the year before, according to the Federation of Electric Power Companies of Japan. Demand for fossil fuel for power generation has surged since the Fukushima Daiichi disaster.
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