Comparative techno-economic performance analysis of underground coal gasification and surface coal gasification based coal-to-hydrogen process

Underground coal gasification (UCG) hydrogen production (UCG-H2) can convert deep coal resources difficult to mine into hydrogen, its economic performance needs to be investigated so the application prospect can be clarified. This paper take hydrogen production with capacity of 1.2 billion Nm3/a as objective, based on simulation results, comparative techno-economic analysis was conducted between UCG-H2 and Lurgi-based surface coal gasification (SCG) hydrogen production (SCG-H2). Benefiting from lower gasification equipment investment, capital investment of UCG-H2 without CCS is only 77.1% of that of SCG-H2, product cost is only 0.73 RMB/Nm3, lower than 1.69 RMB/Nm3 of SCG-H2, and will not be affected by price fluctuation. With 80% capture rate (CR), capital investment ratio increases to 81.8%, product cost of UCG-H2 increases to 1.05 RMB/Nm3, still possesses great cost advantage. If hydrogen market price less than 1.5 RMB/Nm3, IRR of UCG-H2 with 90% CR cannot reach the standard of 12%, possesses no economic feasibility, while SCG-H2 can only be economically feasible when hydrogen market price less than 2.2 RMB/Nm3 without CCS. By conducting sensitivity analysis, competitive carbon tax between UCG-H2 and SCG-H2 with 80% CR and without CCS are determined, as well as correlation between price and carbon tax when SCG-H2 is cost-competitive.