Yangquan
Case Study

Yangquan

Sector: Coal Area of Expertise: Coal Mine Methane

Yangquan

Creating award-winning carbon assets

This is a ground breaking project in China and the first of its kind in the world. It is the largest CMM project registered with the Clean Development Mechanism (CDM), and the largest non-HFC/N2O project in China.

Located in the Yangquan coal mining area of Shanxi Province, China, the project utilises CMM for both power generation and industrial heat applications. The project is split into two parts:

Yangquan was named Carbon Finance Transaction of the Year in 2007 by Environmental Finance magazine.

The first part of the project envisages installs 90 MW of gas engines at three sites. Once fully constructed, it is estimated that this part of the project will deliver greenhouse gas emission reductions equal to 2,136,174 tCO2e per annum through both preventing the methane from being vented and by generating power that would otherwise be taken from the local grid that is dominated by coal-fired power.

The second part of the project utilises CMM to fuel an aluminum hydroxide roasting furnace. The furnace forms part of a new alumina plant with a production capacity of 800kt of alumina per annum. This is the first time CMM has been utilised to produce alumina. This highlights the integral additionality of this project. Greenhouse gas emissions are reduced through both the destruction and utilisation of the CMM and through the displacement of coal that would ordinarily be used to fuel the furnace system. Once fully implemented this part of the project will deliver greenhouse gas emission reductions equal to 964,775tCO2e per annum.

Yangquan employs Austrian, German and American technologies, and serves as a demonstration project for the engine manufactures who are using Yangquan as a springboard to implement similar technologies elsewhere in the global coal mining.

Operating with one of China’s largest anthracite (hard coal) production bases, Yangquan Coal Industry Group is not only focused on the quality of coal, but is also placing increased attention on environmental protection and carbon reduction. Our group has two CDM projects: CMM Utilization to Power Generation and Advanced Industrial Furnace Utilisation Project. Both of these projects are registered and the first one has even issued CERs. We have achieved this through a solid partnership with Camco Clean Energy, and look forward to having a brighter future with them.
Xue Bifen Chief Engineer Yangquan Coal Industry Group

CMM, present in gassy coal seams, is a significant source of greenhouse gas emissions. Methane is drained from coalmines such as Yangquan with the primary purpose of maintaining safe underground operating conditions, but extracting CMM at high concentrations has the double benefit of increasing the rate of methane drainage and yielding a gas that can be safely used for heat and power generation. In emerging markets, CMM is generally managed by ventilating the underground mining areas or installing a combination of ventilation and drainage equipment, which vents the CMM into the atmosphere. Unutilised CMM represents a missed opportunity for mine owners that, with the right technology, can treat and utilise the CMM as a fuel, making mining operations safer and more efficient.

Methane has a greenhouse gas global warming potential of 21 times CO2, so opportunities to destroy or utilise methane can be developed into valuable carbon assets. Utilisation of 1 tonne of CMM creates net emission reduction equal to 18 tCO2e (3 tCO2e are discounted as CO2 is created), and 1 MW of CMM utilisation capacity will achieve the same emission reductions as 5 MW of wind generation. Therefore the 90 MW Yangquan engine will generate the same number of CERs as a 450 MW wind farm.

This project would not have been possible without the benefits of carbon finance and Camco Clean Energy worked closely with the client to develop an effective CDM management system, including the implementation of the necessary data monitoring and management and measures.

Camco Clean Energy coauthoured the UN approved methodology for the project, and achieved complete registration with the CDM within 12 months of its adoption. The project issued its first CERs in July 2008.

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