Sulfur Dioxide and Acid Deposition Control in Guiyang

Guiyang, the capital of Guizhou Province, is one of the most seriously polluted cities in China (Guiyang Environmental Protection Bureau, 1991~1997). The major air pollution source in Guiyang is high-sulfur coal combustion, which accounts for over 90% of the city's energy

consumption. Acid rain derived from high sulfur dioxide emissions causes such severe impacts on the environment of Guiyang that zinc-

plated steel lasts only four years in contrast with the normal lifetime of twenty-nine years.

As the economy in Guizhou continues to develop, coal consumption is expected to increase commensurately. Coal consumption in the early

21st century is projected to at least double the 1980s consumption level. Given the recent boundary expansion, the city now accounts for

more than 50% of sulfur dioxide emissions in the whole province. 3.1 Meso-scale Transport of Sulfur Dioxide

Although much research work has been carried out and many hypotheses have been postulated concerning the formation of acid rain in

Guiyang, no firm conclusions have been drawn about long-range transport and the scale of formation of acid rain in the province. This has caused difficulties for policy makers trying to mitigate and control acid deposition. The UNDP project launched a meso-scale (i.e., medium

range) field survey on the transport of sulfur dioxide from Guiyang to nearby mountainous areas. Rainwater, cloud water and ambient air

samples were collected at two monitoring sites: Zhazuo and Yunwushan. The first site is a small town with no industrial sources located about 30 km north of the Guiyang urban area, while the second one is located at the top of Yunwushan Mountain, a clean area about 10 km

away with no anthropogenic disturbances. Both Zhazuo and Yunwushan are located north of the city, and both southerly and northerly

winds were observed during the monitoring.

The hourly and daily averages of SO2, NO2, NOx, O3 and PM10 monitoring data at Zhazuo and Yunwushan showed strong correlations of

pollutant variations at these two sites. Both sites had high values on the same days (May 26th and 27th, 1998) under southerly wind

conditions. As north winds prevailed after May 27th, the concentrations of pollutants dropped at both sites. This indicates that pollutants from the urban area of Guiyang or Qingzhen power plant were likely influencing the monitoring sites. Transport of air pollutants was a

regional phenomenon, because the distance between the two sites is approximately 25-30 km. Although acid precipitation within the urban

area of Guiyang has been alleviated to some extent, there was no obvious decline in rainwater acidity in these relatively clean and remote areas of Guiyang. Regional pollution in acid rain clearly exists in the region surrounding Guiyang.

Acidity and ion concentrations of rain water samples collected from Zhazuo and from Yunwushan are shown in Fig. 3-1 and Fig. 3-2, respectively. The weighted averages of pH values of rainwater samples were 4.43 and 4.37 for the two sites, respectively. The dominant

ions in rainwater were sulfates SO42- and ammonium ions NH4+.

Fig 3-1. Chemical composition of precipitation in May 1998 at Zhazuo (pH: 4.43, sum of cations: 196.0 meq/l, sum of anions: 178.7 meq/l)

Fig 3-2. Chemical composition of precipitation in May 1998 at Yunwushan (pH: 4.37, sum of cations: 158.5 meq/l, sum of anions: 139.8 meq/l)

Cloud water collected from low-altitude clouds at Yunwushan was acidic with an average pH of 4.71, and the major ions again were sulfate and ammonium (Fig. 3-3). On analyzing the energy structure in Guiyang and its peripheral areas, the UNDP project team believes that the

acid rain had its origin from sulfur dioxide from coal combustion, since all rainwater and cloud water samples were acidic, and the dominant

ions were sulfates and ammonium.

Figure 3-3. Chemical composition of cloud water in May 1998 at Yunwushan (pH: 4.71, sum of cations: 218.1 meq/l, sum of anions: 201.1 meq/l)

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3.2 Management Information System and Modeling

Guiyang is a relatively poor region in China in terms of social and economic development. Relying on high-ash and high-sulfur coal

resources, Guiyang is facing great challenges in sustainable development (Guiyang Environmental Protection Bureau, 1998), and one

means for the local environmental protection bureau (EPB) to improve its environmental management and decision making is through the establishment of an environmental management information system (Li, 1995). The UNDP project supported the construction of such a

system, comprising of geographical information, environmental quality data, emission source inventory, energy, economic and

meteorological data, as well as simulation and assessment models (Yu, 1997).

The RAINS (Regional Air Information and Simulation) model developed by the European Union was employed for scenario analyses of

Guiyang's acid deposition. Table 3-1 shows that remote emission sources (including some still in Guizhou province) contribute 2/3 of the total acid deposition in Guiyang.

Table 3-1. Contribution of local and remote sources to acid deposition in Guiyang

1990 2000 2010 2020

Contribution of remote sources (%) 65.56 71.74 73.79 75.61

Contribution of local sources in Guiyang (%) 34.44 28.26 26.20 24.39

It implies that only 1/3 of acid deposition in Guiyang comes from local sources within the city. Thus, a control strategy focusing solely on Guiyang emission sources will not be sufficient to stop acid deposition, because two-thirds has its origin in long-distance transport. These

results support a regional emission control strategy.

3.3 Current Strategies for the Control of Sulfur Dioxide and Acid Deposition Guiyang has implemented national regulations on sulfur dioxide and acid deposition control, as well as the total emission control strategy.

The municipal government has issued corresponding local instructions and regulations. The control strategy in Guiyang has three distinct

components: (a) the control of short-chimney area source emissions in the urban area; (b) the control of major point sources that are

supported by Japanese loans; and (c) the control of other point sources, mainly industrial boilers.

The partial control of area sources in the urban area was successful. It gave people confidence that air pollution could be brought under

control, if correct measures are undertaken. However, the controlled area sources contributed only 25% of the total sulfur dioxide emissions. In order to curtail point source emissions, Guiyang has completed negotiation with the Japanese government for low-interest loans to control

seven major sources, including the steel mill, the cement mill, the power plant and others. This would remove 170,000 tons/year of sulfur

dioxide after the completion of Japanese projects. This would still leave 360,000 ton/year uncontrolled from other sources, mainly from the 1,253 industrial boilers identified in the inventory. The technical and economic feasibility to control industrial boilers remains questionable.

Although NEPA and MOST have supported control demonstration projects in Guiyang, there is still considerable uncertainty about the

operational cost, technical viability and secondary pollution. 3.3.1 Cleaner fuels for area sources

In the past decade, cleaner fuels, such as town gas, LPG, coal briquettes and even electric kitchen appliance have been introduced

gradually in the urban areas of Guiyang for residential and commercial cooking purposes. These control measures have improved the air quality significantly. TSP levels in many years were readily below the national ambient standard for urban areas. The annual average

ambient sulfur dioxide concentrations have been reduced dramatically, from the 468 mg/m3 in 1990 to levels around 153 mg/m3 in 1998.

However, the sulfur dioxide levels still exceeded the urban air quality standard, because these cleaner fuels can replace only a part of raw

coal consumed for cooking in the residential and commercial sectors. Such area sources constituted only approximately 25% of the city's SO2 total emissions. It is held that the high cost of gas fuels currently precludes such an approach for industrial boilers.

3.3.2 Moving high-stack point sources to the suburban areas and shift from manufacturing sectors to service sectors

Guiyang adopted two strategies for integrated pollution control in the industrial sectors: i.e., the so-called "shift from the secondary industry

to the tertiary industry" and "moving plants from urban areas to suburban areas". Some heavily polluting industrial plants like the cement mill, fabric-dyeing plants, phosphorus chemical plant, etc., have been either shut down, or switched to other less polluting sectors. The city

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still plans to move more than 20 enterprises to the suburbs. The findings of UNDP Guiyang project have indicated that acid deposition is a

regional pollution issue, however, and moving these polluting industries to the suburban areas would not solve this problem. The strategy of industrial re-structuring is likely to provide better environmental results.

3.3.3 Energy conservation strategy in industrial sectors

There are many large point sources in the urban and suburban areas of Guiyang, such as the power plant, the steel mill, and others. The findings of the UNDP capacity building project in Guiyang provided a more competitive basis for acquiring Japanese loans. With the aid of

Japanese loans and local capital investment, Guiyang will upgrade the major manufacturing facilities in these enterprises and add some

new pollution control devices, so that the energy efficiency can be improved and emissions reduced.

Energy conservation is a "win-win" strategy, which can bring economic, environmental and social benefits to both industrial enterprises and

the society. As the UNDP Guiyang project showed, the total investment on energy conservation and its share in the gross investment on technical renovation and transformation are both incremental, and this makes the measures for energy conservation feasible. Table 3-2

gives the actual investment in recent years for energy conservation in Guiyang. Table 3-3 shows the actual energy saving in two factories

with boilers of 10t/h capacity.

Table 3-2. Investment on energy conservation in Guiyang

[Source: Guiyang Statistical Bureau, 1993-1998] Year Investment on technical renovation and transformation(104 RMB) Investment on energy conservation(104 RMB) Share of energy

saving in the total technical renovation (%)

1993 94,006 4,327 4.60 1994 126,705 1,278 1.01

1995 169,612 1,428 0.84

1996 169,314 1,759 1.04 1997 225,042 8,628 3.83

Table 3-3. The cost and benefit of energy-saving in Guiyang

Plants Investment used for energy- saving (yuan) Coal consumption before energy saving (tons/day) Coal consumption after energy saving (tons/day) Coal saved (tons/day) Cost saved (yuan/day) SO2 levy fee saved (yuan/day) Payback period of the investment (days)

Guiyang Mining Machinery Factory 170,000 17.00 7.00 10.00 1,200.00 170.00 125

Guizhou Beer Brewery 140,000 27.40 19.18 8.22 986.07 139.74 125 Notes:(1) Coal price is taken as 120 yuan/ton.

(2) The sulfur content in coal is taken as 5%.

(3) Other costs are excluded.

The data in Table 3-3 show that the gross investment in energy conservation is not very large, even though the payback period is relatively

short. Thus, energy conservation is an effective and appropriate measure for a poor region like Guizhou to control SO2 and acid rain pollution. According to the statistics from Guiyang, only 9.8% of the total sulfur dioxide emissions were actually removed in 1997. On the

other hand, energy-saving measures could reduce about 30% of sulfur dioxide emitted.

3.3.4 Demonstration of flue gas desulfurization on industrial boilers There are numerous small- and medium-size boilers in Chinese cities. Abatement of emissions from these boilers will not be covered by

international financial support, and will rely mainly on domestic financial resources. Up to now, the performance of FGD demonstration

devices in Guiyang has not been satisfactory. A series of technological, managerial and economic problems remain unsolved (see

Addendum to this chapter). It is expected that these problems will be tackled in the next five-year plan. 3.3.5 Prohibition of excavation of high-sulfur coal

In compliance of the promulgated national regulation on prohibition of high-sulfur coal, the coal mines excavating coal with sulfur content

higher than 5% have been shut down. The follow-up enforcement of this regulation must continue for a long period of time.

3.3.6 Demonstration of cleaner coal production

The sulfur and ash contents of coal in Guizhou province are rather high. Although the government encourages coal washing, the higher

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price of washed coal makes consumers reluctant to use it. On the other hand, advanced cleaner coal demonstration projects, such as

Integrated Gasification Combined-Cycle (IGCC) technology, have the drawback of high investment and low return rate. Further efforts to employ new economic tools like a high-sulfur coal tax would be required to encourage the consumption of washed coal. In 1994, washed

coal in China amounted to 260 million tons, bringing in 6,250 million yuan of revenue. The costs and benefits for a Guiyang coal-washing

facility and for consumers are listed in Table 3-4 (although environmental benefits are not monetized).

Table 3-4. Cost-benefit analysis of coal washing in Guiyang

[Sources: Scientific Standard Office, 1998; personal communication with Liu Liangmin, vice chief-engineer, Coal Office, Guizhou province] Category of benefits Items Unit

Benefit of the coal washing plant Price of raw coal (5% sulfur) RMB 110 yuan/t

Price of washed coal (90% recovery) RMB 237 yuan/t Initial investment for coal washing plant RMB 80 yuan/t

Process cost of coal washing RMB 10 yuan/t

Revenue RMB 13.3 yuan/ton of raw coal

Economic benefit of consumers Benefit from coal conservation RMB 22.25 yuan/t Maintenance cost saved RMB 3 yuan/t

Decrease in flue gas desulfurization cost (50% sulfur removal in washing) RMB 8.5 yuan/t

Dust and fume controlling cost reduced RMB 0.2 yuan/t Subtotal RMB 33.95 yuan/t

Cost increment by using washed coal RMB 69.35 yuan/t

Social benefit Coal transportation cost reduced RMB 1.6 yuan/t Ash/slag disposal cost reduced RMB 2.08 yuan/t

Subtotal RMB 3.68 yuan/t

Environmental benefit Decrease in dust and fume emissions 2.08 kg/t Decrease in sulfur dioxide emissions 50 kg/t

Under the right regulatory conditions, coal-washing plants could make profits, so production could be assured. Nevertheless, consumers do

not have incentives to use the cleaned coal, because there is an additional cost increment of approximately 70 yuan/t. Some type of regulatory (or economics-based tax) policy is therefore required in Guizhou to encourage the use of washed coal.

3.4 Strategy Changes for Sulfur Dioxide/Acid Deposition Abatement

For effective control of sulfur dioxide and acid deposition, the following strategy changes must be made. 3.4.1 Implementation of energy conservation

Since industrial restructuring and production-facilities upgrading processes are being taken into consideration, emissions from industrial

sectors are being reduced. However, emissions from the residential and commercial sectors are still increasing, due to the additional consumption of coal and electricity for space heating and air conditioning. The local environmental bureau must therefore pay more attention

to energy conservation strategy in all sectors for air pollution abatement, including the construction of energy-saving residential houses and

office buildings. Improvement in heat insulation of the walls and windows could lead to a significant reduction (30~50%) in coal consumption for space heating and air conditioning, while the additional increment in construction costs is only 5~7%. Energy-saving buildings, green

lighting, and electric motor speed adjustment through frequency modulation are cost-effective measures to improve air quality in those cities

that do not have other alternative cleaner fuels.

Other energy conservation designs include greening of walls, construction of roof gardens, humidity-conservation road paving, exposed

runoff channels, solar panels on the roofs, and heat pumps. Long block buildings should be avoided, and efforts should be made to avoid

urban "heat-island" effects. 3.4.2 Effective role of industrial restructuring and cleaner production in pollution abatement

In the case of obsolete production facilities in China, end-of-pipe pollution control is not always rational and cost-effective. Recent

restructuring of the industrial sectors in many cities is a more cost-effective strategy for pollution abatement. In the case of Guiyang, a prospective option for major point source control is cleaner production, such as upgrading the production facilities in the steel mills and

cement mills, so that the energy consumption rates and emission rates can be reduced. Then, necessary end-of-pipe dust removal and FGD

devices can be added. Economic restructuring is another effective strategy to switch from polluting to less polluting (service) sector activities.

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3.4.3 Inclusion of FGD costs in electricity price

This is an important issue of internalization of externalities. The operating cost and depreciation should be included in electricity price. The operating cost of Chinese utility flue gas desulfurization (FGD) on a commercial scale was found to be in the range of RMB 400~800 yuan

per ton sulfur dioxide. But the current levy system demands only RMB 200 yuan per ton. There are thus no economic incentives to run FGD

devices. The polluters prefer to pay the levy instead.

Furthermore, the central and local governments retain control of electricity prices. The FGD operating costs are not allowed to be included in

the price of electricity. Consequently, installed FGD devices are not, as a rule, in continuous operation. This is the FGD dilemma in China. Fortunately, this issue (discussed in the Situation Analysis Report of UNDP project CPR/96/308) received attention from the State Economic

and Trade Commission, which indicated interest in pursuing this issue with UNDP.

3.4.4 The need for regional pollution control strategies

Acid deposition is a regional pollution issue. If cities are densely located (as in the Beijing-Tianjin-Langfang, Pearl River Delta and Yangtze

River Delta regions), the control of sulfur dioxide/acid deposition will be effective only on a regional scale. Moving the pollution sources from

the urban areas to the suburban areas cannot solve the acid rain problem. Even in remote downwind mountainous areas near Guiyang, acid rain often can be detected. In China, metropolitan areas are usually surrounded by two emission-source belts: a belt of residential areas of

migrating workers in the suburbs, and a belt of polluting industries in the nearby counties. Temporary workers that usually amount to 1~2

millions accommodate in the suburbs of big cities. They cannot enjoy central heating but have to rely on coal stoves. The polluting manufacturing plants are driven from the urban areas of big cities to the nearby counties. These obsolete and polluting plants are beyond

the control of municipal EPBs, yet their emissions readily reach the urban areas.

3.4.5 The development of clean coal technologies and simple FGD technologies There are no ideal measures for the abatement of sulfur dioxide from industrial and space-heating boilers. It is necessary to develop clean

coal technology or simple FGD technology in line with local conditions. For small- and medium-size boilers, switch to cleaner coal might be

cheaper than FGD. The current strategy in Beijing is to prohibit the use of high-sulfur and high-ash coal in the urban areas and to switch to low-sulfur and low-ash coal. Meanwhile, development of sound simple FGD technology is also encouraged.

As shown in Table 3-5, the average operating cost of simple FGD for small- and medium-size boilers is around RMB 700~2000 yuan for

each ton of SO2. Consequently, in the southeast coastal areas, where cheap natural gas or oil can be imported, a switch from coal to natural gas or oil might be feasible. Construction of more gas and oil ports in the southeast parts of China is an indication of this trend.

3.4.6 More capital investment for utility FGD

According to national statistics, the total capital investment for pollution control in the 7th Five-Year Plan was RMB 47.7 billion yuan, which represented about 0.70% of the national GNP. During the 8th Five-Year Plan period, the total capital investment for pollution control was

0.85% of the national GNP, whereas during the 9th Five-Year Plan period, it reached 1% of GNP. Approximately 40% of this figure was

used for air pollution control. For effective control of sulfur dioxide, much more investment is required.

According to the Guiyang Statistical Yearbook (Guiyang Statistical Bureau, 1993-1998), the funded resources for pollution control projects in

Guiyang (Table 3-6) could not meet the demand.

Table 3-5. Cost estimation for industrial boilers FGD Wet FGD Scrubber Sulfur removal(%) Dust removal (%) Boiler capacity (t/h) Life span(yr) Capital investment (104 yuan) Depreciation

(yuan /year) Operating cost (yuan /year) Total annual expendiure(yuan/year) Unit cost of FGD(yuan/ton SO2)

Sieve plate 60 93 4 8 5.00 10,065 10,107 20 173 693

type 70 93 10 5 13.5 37,460 48,649 86,109 1,026

65 98 10 6 12.4 30,157 31,783 61,940 798 50 98 6 4 5.2 17,111 19,591 36,702 974

70 98 6 8 18.45 37,140 24,536 61,676 1,201

55 94 10 6 11.5 27,968 35,323 63,291 985 Water film 65 96 6 8 16.5 33,215 21,829 55,044 1,212

type 40 95 10 4 13.14 43,238 39,674 83,912 1,644

45 96 6 5 6.86 19,035 22,449 41,484 1,256 Bubble cap type 37 97 10 4 12.5 41,132 41,245 82,377 1,911

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Table 3-6. Fund resources for pollution control in Guiyang

(Units: 104 yuan) Year Total Funds of basic construction Funds of renovation and reconstruction Funds from the retained profits for integrated utilization

Envron-mental protection subsidy Environ-mental protection loans Other funds

1993 1,266.5 155.0 289.1 2.9 228.4 33.4 591.1 12.2% 22.8% 0.2% 18.0% 2.6% 46.7%

1994 2,087.9 130.8 313.8 229.1 202.6 30.0 1,211.6

6.3% 15.0% 11.0% 9.7% 1.4% 58.0% 1995 3,027.8 16.1 1,040.7 83.6 238.9 15.0 1,648.5

0.5% 34.4% 2.8% 7.9% 0.5% 54.4%

1996 4,048 3 258 136 262 854 2,535 0.07% 6.4% 3.4% 6.5% 21.1% 62.6%

1997 8,591.5 506.6 3,007.7 18.5 248.5 588.0 4,222.2

5.9% 35.0% 0.2% 2.9% 6.8% 49.1%

Note: "Other funds" refers to the funds employed for pollution control outside the categories detailed above. It includes domestic loans (i.e., non-environmental loans), foreign capital, funds financed by enterprises themselves (i.e., other than retained profits), and funds from some

other sources.

Funds for basic construction, funds for renovation and reconstruction, and the environmental protection subsidy mainly came from the

government's fiscal budget. It is known that the government's financial resource accounted for about 40% of the total environmental

protection investment. In a session of the National Congress on environment and resource protection issues in December 1995, it was put forward that resources for environmental protection should be increased, and that the share of investment for pollution control in GDP

should go to 1.5 % by the end of 2000. Hence, when combined with municipal infrastructure restructuring, existing government financing

channels could become an important source of additional funding for environmental protection purposes.

Guiyang's financial revenues came mainly from industrial and commercial taxes in the past few years, accounting for roughly 80%~90% of

expenditures. The share of governmental budget income to GDP in Guiyang increased from 4.3 % in 1993 to 6.6 % in 1997. Even then, the

share of environmental protection spending in the budget of Guiyang was smaller than that in the national budget (10.6 % in 1996), and was far below those of cities in developed countries. Environmental

protection expenditures were included in categories for capital construction and for municipal maintenance, and the overall share of these

two items remained at a level of 20%, with very little growth in the past few years.

It is important to note the share of environmental investment in the total fixed capital investment, as well as its growth rate. In Table 3-7, it is

shown that the approximate share of environmental protection investment in the total fixed capital investment was 0.6 percent in Guiyang, and its share of GDP was about 0.2 percent. According to Ma's data in "Analysis of Chinese Environment Economic Policies" (Ma and

Zhang, 1996), the national environmental protection investment amounted to 2.5 % of the total fixed capital investment, and was equal to

about 0.8 % of GDP. Thus, the share of environmental protection investment in Guiyang has been far less than the average level in the country, despite its severe environmental problems.

Table 3-7. Fixed assets and environmental protection investment in Guiyang

(Units: 104 yuan)

Indicators 1993 1994 1995 1996 1997

Total fixed capital investment 242,644 324,375 493,614 574,771 619,664 Growth rate compared with the year before - 33.7% 52.2% 16.4% 7.8%

Total environmental protection investment 1,266.5 2,087.9 3,027.8 4,048 8,591.5

Growth rate compared with the year before - 64.9% 45.0% 33.7% 112.2% Share of environmental protection investment in total fixed capital investment 0.52% 0.64% 0.61% 0.70% 1.39%

Share of environmental protection investment in GDP of the same year 0.13% 0.17% 0.20% 0.24% 0.43%

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On the other hand, the growth rate of environmental protection investment has been higher than that of the total fixed capital investment.

Especially in 1997, the shares of environmental protection in GDP and in the total fixed capital investment rose considerably. This indicates that Guiyang's government has begun to give higher priority to environmental protection investment. The total funds for environmental

protection were not sufficient, and could not prevent increasing pollution levels in the city. It has been estimated that an investment level for

environmental protection in the amount of 6%~8% of the total capital investment would be required to meet the national and local emission standards for ordinary enterprises, and that 10 % for heavily polluting industries-and even 15 %~20 % for some extremely polluting

industries-will be required. Environment investment in Guiyang is thus far behind the levels needed to obtain the necessary levels of

environment quality sought in China.

3.4.7 More effective implementation of the "Three Synchronization" system

The "Three Synchronization" system was one of the earliest implemented environmental management systems in China. Since 1973, it has

been required that all new construction and expansion/reconstruction projects incorporate pollution control devices. The "three

synchronicities" cover the design, construction and operation phases of project development. Implementation of the "Three Synchronization"

system does promote pollution control in Guiyang. It is also the main funding source for environmental protection investment in the city. However, it should also be emphasized that there are numerous problems associated with its implementation.

The compliance rate is fairly low. Although the local government in Guiyang reported the compliance rate for the "Three Synchronization" system to be 100%, the "China Environment Yearbook 1997" (State Environmental Protection Administration, 1998) reports the compliance

rate in Guizhou Province to be only 77.4%. That was the lowest among the 30 provinces/autonomous regions in the China mainland. The

"Three Synchronization" execution/attainment rates in Guiyang are therefore probably somewhat lower than reported, and the compliance rate for TVEs is almost certainly lower still. Even when environmental protection facilities are constructed, it has been observed that they are

often not operated.

Chapter 3 Addendum

In order to address the flue gas desulfurization (FGD) issue, the UNDP Guiyang project organized a technical workshop, which was held in

the city on July 25-31, 1999. Available technical information about various FGD processes was presented at this workshop. The Japanese loans in Guiyang will cover only the capital investment of FGD installations, and the enterprises must take care of the FGD operational costs

themselves. The success of such FGD projects in China thus relies on developing appropriate economic policies and the incentives of the

enterprises to run these facilities.

3A.1 Domestic FGD technologies for small- and medium-sized industrial boilers

For non-utility industrial boilers, wet scrubbing for both dust and sulfur dioxide removal is very popular in China. Although the removal

efficiencies for dust and sulfur dioxide are not very high (70~80% for dust and 30~70% for sulfur dioxide), enterprises prefer to use existing

dust-removing scrubbers for sulfur dioxide removal too. The popular types of scrubbers employed in China are cyclonic spray towers and venturi applications with throat injection. Usually the towers are made of granite, which is resistant to sulfur dioxide corrosion and particulate

attrition. It is thus convenient to use the same equipment for both dust and sulfur dioxide scrubbing.

There are several varieties of wet scrubbing processes for flue-gas desulfurization, depending upon the agitation method and alkaline

material employed (i.e., wet scrubbing with spraying alkaline solutions, wet scrubbing with self-agitating alkaline solutions, wet scrubbing

with rotating alkaline solutions, and wet fly-ash injection). There are more than 24 manufacturers of domestic FGD facilities in Beijing, and

hundreds throughout the country, concentrated in Zhejiang, Fujian and Hunan provinces. Table 3A-1 lists scrubbers that have been tested in Beijing in the recent years. In addition, the Japanese funding agency EPDC has supported some testing and demonstration of FGD for non-

utility boilers in China, as shown in Table 3A-2.

A number of problems have been reported with existing FGD equipment (including the units tested in Guiyang). These include:

Corrosion. Removal of acid mist is not always successful, and the acid mist and fine particulate matter cause corrosion and vibration of

fans and blowers. To avoid corrosion, manufacturers use acid-resistant cement, ceramic, enameled steel, rubber, fiber-glass composite,

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stainless steel and other chemical lining (mainly expoxy resin). The life span of FGD equipment depends on the fabrication techniques,

transportation and installation carefulness, and the actual flue gas composition. With certain exceptions (e.g., the Bidajing Corp.), manufacturers and designers tend to ignore the corrosion of nozzles, pipeline system, ducts and fans/blowers. Most of the operation failures

were caused by the corrosion of these accessories, however, rather than the towers. It is ultimately important to select the proper stainless

steel. Stainless steel of the type of Ni/Cr 18/8 does not resist the stress-induced corrosion in the presence of chloride ions.

Attrition. The particulate matter in the flue gas caused serious attrition problem to the scrubbers. Granite, cement and enamel withstand

attrition quite well, whereas epoxy resin linings with a thickness of 0.5 mm often cannot withstand long-term attrition. Serious corrosion occurred after the wear- out of the lining.

Scaling and fouling. Scale formation during unstable operation (pH fluctuation, in particular) and fouling of spraying nozzles cause

frequent failure of FGD equipment.

Secondary pollution. The small- and medium-sized FGD equipment does not include forced oxidation of bisulfites and sulfurous acid in

the scrubbers. A part of the sulfurous acid in the absorbent-liquor will decompose and release sulfur dioxide again after discharged from the scrubbers. Most of the existing small FGD installations do not have facilities for wastewater treatment. Operation costs do not include

discharged water treatment costs.

The Beijing Municipal Environmental Protection Institute has made an assessment indicator system for the evaluation of FGD performance

on industrial boilers (see Table 3A-3), with various technical, environmental, maturity and economic factors identified. As we have mentioned

in the previous section (Table 3-5), the average FGD unit cost of simplified processes lies in the range of 700~2,000 yuan/ton SO2. With such high costs, it is rational to use cleaner fuel to replace high-sulfur coal in the coastal areas for non-utility boilers, and the government

has indeed begun to implement such measures there.

3A.2 Utility FGD applications The existing efforts on utility boiler FGD in China are summarized in Table 3A-4. As noted in this table, these tend to be larger, more

sophisticated technologies, often purchased from foreign vendors. They are therefore able to overcome many of the technical concerns

noted above. However, they also tend to be considerably more expensive, and paying the high operation and maintenance costs is

particularly problematic.

The operation cost of China's first commercialized utility FGD facility was reported to be about 400 yuan/ton SO2. Yet the current levy

system requires the polluter to pay only 200 yuan for each ton of sulfur dioxide exceeding the emission standard.

There is thus no economic incentive for the polluters to run FGD facilities. Moreover, the FGD operation, maintenance and depreciation

costs must be included in price of electricity. Yet the government (as discussed below) controls the price of electricity, and will not include such costs in the price. As a result, FGD facilities may be closed down after construction and inspection, since there are no operating funds

and no significant penalties for taking such actions. Such is the FGD dilemma in China.

Table 3A-1. Domestically manufactured wet scrubbers tested in Beijing

Model Description Manufacturer TS/S Multi-tube cyclone + spray tower for FGD & dust removal Nei-an-he / Beijing Environmental Research

ZG-G (SJ) Double impingement + Venturi for FGD & dust removal Shenyang Environ

SHG Dry cyclone + wet sieve-plate scrubber for FGD & dust removing Beijing Occupational Protection Institute

BL-ZH Dry cyclone + wet sieve-plate tower + demister for FGD & dust removal Idem XTS Venturi for FGD and multi-tube cyclone for dust-removal

SC Vertical Venturi + cyclone for FGD & dust removal Feicheng Equipment Corp., Shandong

ECS Charged lime solution spray under electrostatic field for FGD Hongda Co., Beijing XSC Cyclonic water curtain spray + wetted impingement grid for FGD & dust removal Xishan Co., Beijing

STCX Self-agitation Venturi + cyclonic spray tower for FGD & dust removal Tongmin Co., Beijing

TCSC Venturi + spray tower for FGD with fly ash & dust removal Bidajing Co., Beijing QRG Gas-emulsifying filter (rotating impeller) for FGD & dust removal Aerospace #701, Beijing

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YSC Spraying + grid for FGD & dust removal Yingyan, China Air

PTL Spray drying desulfurization tower Ministry of Weapons, Beijing TS/B Multi-tube cyclone + spray chamber with bowl nozzle + demister for FGD & dust removal Zhang-jia-kou Thermal Energetics, Hebei

SCX Cyclonic spray tower for FGD & dust removal Hunan University, Hunan

XP Cyclonic water film + XP type plate tower for FGD & dust removal Xiangtan University, Hunan TGXC Cyclone + impingement tube scrubber for FGD & dust removal Tianjin Ventilation Corp., Tianjin

XLT Swirling-plate tower + demister for FGD & dust removal with dry lime injection and water Spraying Zhuzhou Jingyuan Corp. / Zhejiang

University

Table 3A-2. Simplified wet FGD demonstration on industrial boilers with Japanese assistance Plant Location FGD Supplier Technology Capacity,Nm3/h Inlet SO2 concentration, ppm Sulfur removal, % Commissioned

Weifang Chemicals Weifang, Shandong Japanese Green Fund Liquid-column tower 100,000 1,500 >70 1995

Nanning Chemical Group Nanning, Guangxi Japanese Green Fund Non-packed tower 45,000 2,100 >70 1995

Changshou Chemicals Chongqing Japanese Green Fund Bubbling tower 65,000 2,000 >70 1995

Table 3A-3. Technical and economic evaluation indicator system for FGD equipment on industrial boilers

Indicator category Indicator Indicator (unit) Rank A B C

Technical Resistance to corrosion & attrition Bulk life-span (year) >7 5-6 3 1-3 0.8 0.8-0.2 1200

Environ- mental Sulfur removal rate % >60 40-60 95 90-95 10

Duration of operation (year) >4

Firm capacity Fixed assets (million yuan) >3 5

Economic Unit cost of desulfurization yuan/ton SO2 1500

Capital investment for unit boiler capacity Thousand yuan/ton steam 15

Table 3A-4. Utility boiler FGD facilities in China

[Source: SEPA, 1998] Power Plant Location Desulfuri-zation equipmentsupplier Technology Capacity, Nm3/h Sulfur content of coal, % SO2 removal, % Calcium to

sulfur ratio Commis-sioned Luohuang Power Station Chongqing Mitsubishi Heavy Industry Wet scrubbing(single loop) Commercialized1,087,000 2 (2 360

MW);2nd phase (85% 2 360 MW) 4.02 95;80 1.02 1992;1999

Neijiang Power Station Neijiang, Sichuan Finland Cycling fluidized-bed combustion Commercialized(100 MW) (410 t/h) 1996 Xiaguan Power Station Nanjing, Jiangsu IVO,Finland Dry lime injection (LIFAC) Commercialized(2 125 MW) 0.92 75 2.5 1999

Chongqing Power Plant Chongqing Steinmuller Wet scrubbing Commercialized(2 200 MW) 95 2000

Beijing 1st Thermal Power Plant Beijing Steinmuller Wet scrubbing Commercialized (2 410 MW) 95 2000 Banshan Power Plant Banshan, Zhejiang Steinmuller Wet scrubbing Commercialized(2 125 MW) 95 2000

Huangdao Power Station Qingdao, Shandong MHI Rotary spray drying (LILAC) EPDC Demonstration 300,000 (a fraction of 210 MW) 1.5-2.0 70 1.4 1994

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Taiyuan 1st Thermal Power Station Taiyuan, Shanxi Babcock- Hitachi Wet scrubbing (simplified) EPDC Demonstration 600,000 (a fraction

of 300 MW) 1.82 80 1.1 1996 Chengdu Thermal Power Station Chengdu, Sichuan Ebara Corp. Electron beam Demonstration 300,000(?200 MW) 1.2 80 NH3 1997

Western Shenzhen Power Station Shenzhen, Guangdong Norwegian ABB Sea water scrubber Demonstration (300 MW) 0.630.75 90;70

Sea water 2000 Jiawang Power Station Xuzhou, Jiangsu Pressurized fluidized- bed combustion (15 MW)

Fusun Power Station Fusun, Liaoning Tempella Power, Finland Lime injection (120 MW) 0.54 40 1996

Baima Power Station Baima, Sichuan Domestic Rotary spray drying 300,000 n.a. 80 1.4 1991

In recent years, electricity tariffs in China have become extremely complex. For instance, there were recently 27 different prices for power consumption in the Northeast Power Group alone. In Beijing, there are seven basic prices (e.g., for residences, non-residential illumination,

large-scale industries, agricultural, irrigation in poor counties, etc.), thirteen wholesale prices, and nine peak prices, all over three different

voltage ranges, and with additional capacity charges for certain user categories. Very often, three to five different prices for power

consumption appear on the monthly utility bill. Many people (both consumers and suppliers) complain that electricity tariffs are simply too complicated. In 1995, based upon average residential electricity tariffs, electricity prices are: 0.60~0.70 RMB/kWh in Guangzhou; 0.4~0.5

RMB/kWh in Shanghai; and 0.25~0.3 RMB/kWh in Beijing.

These prices tend not to reflect the marginal cost of production, but rather the administrative force and/or bargaining power of the users. A

pricing mechanism based upon marginal production cost (including pollution control costs), applicable taxes and a reasonable rate of return

should be developed. The "new plant, new price" policy for electricity is now being applied in a manner which avoids the creation of such multiple pricing tiers. It is anticipated that this policy could push average electricity prices at/or above the long run marginal cost of electricity

generation.

The success of flue gas desulfurization in power plants ultimately depends upon the recovery of operating costs of FGD facilities, which is a

major concern of the utility companies (see Table 3A-5). New power plants recover their operating costs and depreciation, both of which are

reported in the utility accounts according to the new Financial Accounting System of Industrial Enterprises, which has been in effect since

1993. Any additional costs of capital associated with debt finance have generally been recovered by the local government, using tax revenues and the earnings of profitable state-owned enterprises that are remitted to the government. Unfortunately, however, flue gas

desulfurization has not been recognized as a part of the production cost, and hence is not included in the electricity price.

Power prices are still set and controlled by the government at the central level (the so-called in-plant prices or catalog prices); at the

provincial level (i.e., surcharges or guidance prices); and even at the municipal and county levels (i.e., surcharges). Inflation control and

ability to pay are the major concerns of the local and central governments. Rapid inflation occurred between 1979 and 1994, leading the State Council to control prices. In 1994 and 1995, the State Council issued orders prohibiting price increases for regulated commodities

(including electricity). Since that time, the government has adopted macro-economic tools to control inflation in general, but continues to

control electricity and water tariffs in order to assist in inflation control.

Recently, there are instances in which the water tariff regulations have become more flexible, and it is expected that its use for inflation

control will be abandoned in the longer run. Since January 1999, sewage treatment costs have been included within the water tariff. One would expect a similar outcome for electricity pricing, as there are no longer any reasonable excuses for excluding FGD costs within

electricity pricing.

The affordability of these systems (i.e., the customers' ability to pay) is obviously another concern of the government. Preliminary analyses suggest that the affordability should not be a significant problem, at least in the wealthier urban districts of the country. The average per

capita consumption of electricity is about 83.5 kWh/year (Wu, 1997). An additional increment in the electricity price of RMB 0.03 yuan/kWh

due to flue gas desulfurization would cause an annual extra expenditure of 2.51 RMB, which is about 0.5% of the average per capita income of the urban residents. This amount is much lower than the per capita expenditures for cigarettes, liquor or beer even for the lowest income

urban residents (SSB, 1997). Data suggest that the annual per capita real income of urban residents is highest in Shanghai, Guangdong,

Beijing and Zhejiang (SSB, 1997), and the initial reforms for including FGD devices should begin there.

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Yet another governmental concern about raising electricity prices is that such an action might worsen the recession in manufacturing

industries. The recession stems, however, from a mismatch between the supply of goods produced and the demand for such goodsnot from an immobile electricity tariff. The only way to reduce the severity of such recessions is through restructuring of industrial entities,

allowing their activities to more closely follow demand. A rational increase in electricity price (including FGD operational costs) would

promote such industrial restructuring by phasing out electricity-intensive industrial organizations (e.g., aluminum utensils, steel products, etc.) that cannot currently meet international norms.

As noted earlier, the "Situation Analysis Report" of UNDP project CPR/96/308 identified the problems associated with FGD operational costs not being included in electricity prices, and this topic was duly noted by the State Commission on Trade and Economics (SETC). SETC

indicated that it planned to further investigate this issue in conjunction with UNDP.

References

Guiyang Environmental Protection Bureau, 1991-1997. Report on Environmental Quality in Guiyang, Guiyang.

Guiyang Environmental Protection Bureau, 1998. "Technical Report on the Registration of Emission Sources," Guiyang EPB Report No. 2. Guiyang Statistical Bureau, 1993-1998. Statistical Yearbook of Guiyang, Guiyang.

Li, J. L., 1995. "The Control Program for Coal Combustion in Guiyang," Guiyang EPB Report No. 4, July.

Ma, Z., and Zhang, Shi-Qiu, 1996. Personal communications. Scientific Standard Office, State Environmental Protection Agency, 1998. The present situation and assessment of sulfur dioxide control

from coal burning, SEPA, Beijing.

SEPA (State Environmental Protection Administration), 1998. "Current State and Integrated Assessment of Sulfur Dioxide Control Technologies from Coal Combustion," Huanjing Baohu (Environmental Protection), (4): 4.

SSB (State Statistical Bureau), 1997. China Statistical Yearbook 1997, China Statistical Publishing House, Beijing.

State Environmental Protection Administration, 1998. China Environment Yearbook 1997, China Environmental Science Press, Beijing. Wu, Jie (ed.), 1997. China Economic Systems Reform Yearbook 1997, China Reform Publishing House, Beijing.

Yu, S., 1997. "Research on Environmental Management Information System," Master Thesis, Peking University, Beijing.

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