Cleaning up Chinas coal

BLOOMBERG NEWS | March 28, 2012 1:15 PM ET

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REUTERS/Dwi ObloA worker of state-coal miner PT Bukit Asam cleans a conveyor belt at the Tarahan coal port in
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By Bloomberg News
After studying chemistry at Shanghais Fudan University, Jane Chuan and Wang Youqi
pursued doctorates in the U.S. She got hers from whats now the University of Buffalo in
1988, the year they married. Wang graduated in 1994 from the California Institute of
Technology.
A few years later, they were cashing in stock options in Silicon Valley companies theyd
co-founded. Their home in Atherton, California, had seven bedrooms, 11 bathrooms and
an acre of land, Bloomberg Markets magazine reports in its May issue.
By 2000, Wang was convinced that the research methods he was patenting could help
stave off the environmental nightmare he saw unfolding during return visits to his
homeland. China, already reeling from pollution, was poised to more than double coal
consumption during the decade. That would choke cities with smog and exacerbate
global warming.
Chuan, 61, remembers pitching U.S. investors on cleaning Chinas coal. Only a handful
of Californias Internet-obsessed venture capitalists bit, she says.
So, in 2003, the couple moved back to Shanghai. By 2006, Wang had his breakthrough
in sight. Hed found a way to unlock a chemical stored in the coal that was poisoning his
country and to put it to an unlikely use: cleaning Chinas air.
The catalyst he discovered speeds reactions that convert methanol extracted from coal
into a substance called dimethyl carbonate that Yashentech produces for $730 a ton, or
36 percent less than rivals. By adding dimethyl carbonate to diesel fuel, Wang now plans
to cut 90 percent of black carbon soot from the tailpipe emissions of 1,800 Shanghai
buses by year-end.
We said, Lets go to China, where we can leverage brainpower thats cheaper and do
something important for mankind, says Wang, 55, taking a break to greet visitors at
Yashentech Corp., the couples Shanghai-based company.
Yashentechs emissions-busting effort is one way in which China is racing to solve its
clean-energy riddle: How can a country thats hooked on coal mitigate environmental
damage from the dirtiest of fossil fuels?
China passed the U.S. as the top carbon polluter in 2007; it now emits more than the
U.S. and India combined, according to the U.S. Energy Information Administration.

Yet with 1.3 billion people, power-hungry industries and scant oil or natural gas, it has
no immediate alternatives to coal for fueling its economy. China gets 70 percent of its
energy from coal, three times the U.S. figure. It even converts coal into diesel fuel and
ammonia. By 2025, Chinas share of global carbon pollution will jump to 30.3 percent
from 26.8 percent this year, the EIA says.
China cant quit coal. But with efforts from entrepreneurs, mining enterprises and
electricity giants, its ready to tackle its addiction, says Zhou Fengqi, senior adviser to
the Energy Research Institute of the governments National Development and Reform
Commission.
Now that people have meat and fish to eat every day, the environment has also become
a big concern, Zhou says. China is not like a developed country. We cant simply stop
using coal. If we want to use it, we have to clean it up.
Scientists say China must act now. The world has just two or three decades to avoid
irreversible climate change, says Kelly Sims Gallagher, an energy professor at Tufts
University in Medford, Massachusetts.
If the Chinese dont dramatically reduce carbon emissions from coal, theres no way we
can make a dent in climate change globally in the time period that matters, Gallagher
says.
Chinas efforts to tackle carbon pollution extend from labs such as Yashentechs to a
windswept hill in the northern desert, where Shenhua Group Corp. is conducting
Chinas biggest experiment in burying CO2 and studying whether to pump it into oil
wells to boost output.
Meanwhile, in a fishy-smelling lab in Langfang, ENN Energy Holdings Ltd. feeds carbon
dioxide to microalgae. The company is eventually planning to get the organisms CO2
breakfast from its Inner Mongolia coal-to-methanol plant. In return, the algae yield oil
for biofuels and omega-3 fatty acids.
The Chinese are deploying some of these decarbonizing technologies more aggressively
than anyone, says Chris Hartshorn, vice president of Boston-based Lux Research Inc.
They have the money, and their system for investing simultaneously in research,
technology and market adoption should be the envy of the world.

China is underpinning its cleanup by boosting the efficiency of coal-burning plants.

Turbines from Shanghai Electric Group Co. require less carbon-spewing rock to begin
with. China Huaneng Group Corp. is designing its GreenGen plant in Tianjin to wring
more power from coal while capturing sulfur and carbon emissions.
Environmentalists say efforts to improve coal power are shortsighted because they
divert attention and money from renewable energy. Coal is the biggest part of our
carbon problem, and were fighting to keep it underground, says Bruce Nilles, deputy
conservation director of Sierra Club.
Yashentechs Chuan and Wang say China will need to burn coal far into the future,
creating clean-up opportunities. Wang hopes that in 10 years, vehicles across China will
run on sootless diesel, trimming carbon emissions 3 percent. That alone wont stop
global warming. But Wang says it will hearten pollution-weary Chinese when they dont
get blasted by foul bus exhaust.
China may never kick its coal habit. But with entrepreneurs such as Chuan and Wang,
companies curbing pollution and government making it imperative to do so, its
stepping forward to tame a dirty fuel the world still cant live without.