Is There a Net GHG Reduction From K-Fuel Use?
You've got to look at this whole green-house gas situation from the perspective of Evergreen's customers: the power plants that burn the coal. I've heard of one utility that initiated a project to better insulate their pipes, thus improving plant efficiency, and thereby lowering overall carbon emissions. That is a perfect legitimate approach. You'll also hear about utilities sponsoring tree planting projects for the Boy Scouts to offset power plant CO2 emissions. Dell computers will even sell you tree planting services on their web site to offset the carbon your power plant will generate to power your new computer over its expected life. Again, these are all legitimate approaches to reducing CO2.
When the government starts regulating carbon emissions, it will have a dramatic impact on these fossil fuel burning utilities. For example, many eastern utilities are paying premium prices to import low-sulfur coal from Wyoming. BUT, from a carbon perspective, those locomotives generate a LOT of CO2 transporting that coal cross-country. In that environment, using the K-Direct concept to refine the local feedstock makes a lot more sense from the carbon perspective.
Initially Evergreen bought C-Lock to get first in line for their unique agricultural sequestration credits. They were going to bundle those credits with K-fuel so that utilities could legitimately claim to burn coal in a carbon neutral environment. Along the way I think both C-Lock and Evergreen realized that the best business approach was to make it possible to put those same sequestration credits on the open market, and utilize their patented technology to create tools for businesses to participate in the evolving carbon credit market. In other words, let the utilities pay for as much carbon reduction as they care to purchase, and make sure C-Lock is the preferred supplier of carbon verification services.
Of course it is true that the K-fuel process requires significant amounts of energy, and burning fossil fuels creates large amounts of CO2. That's just basic chemistry. There has been talk of using wind mills to power future K-fuel plants, but I haven't heard anything about that lately. More promising is the concept of using so called "let down" steam from power plants to power a K-Direct plant, and that is still a viable concept. The exact benefits of using power plant steam varies considerably, depending on the exact power plant design. In some cases the steam can be obtained free, in other cases it will cost some money, though far less than using an independent boiler to power the K-fuel process.
Another thing to consider is that CO2 reduction with K-fuel can vary considerably based on the quality of the original feedstock. It's a well established fact that the poorer the quality of feedstock, the better the K-fuel process performs. For example, lignites have been processed at Ft. Union that burn with an amazing 25 - 30% less CO2 than raw feedstock. So there's another big variable you have to throw into the big carbon equation.
The bottom line is that new carbon regulations will force power plants to significantly change their habits, but each case is very different, and the depth of required changes will depend heavily upon what new laws emerge from Washington. At this point the only thing that seems clear is that new CO2 regulations are coming, and Evergreen is going to greatly benefit through their C-Lock subsidiary, and eventually though their K-Direct concept.
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