Commercial Fuels
There are four main types of commercial fuel: natural gas, distillate oils, heavy fuel oils, and coal. Coal and oils are supplied in bulk and have simple tariff structures based on the quantity delivered to the site by road or rail. The following sections provide some additional detail on each of the main commercial fuels natural gas, distillate oils, heavy fuel oils and coal.
Natural Gas
Natural gas is normally drawn from a continuous supply and is purchased from a supplier.The cost of the gas is determined on an individual contract basis and will reflect factors such as location, the required quantity and capacity of supply, and the degree of supply security required. In all cases, the actual prices charged are a result of contract negotiation and can be fixed for periods of, typically, up to three years, thereby providing a relatively stable fuel supply cost. Natural gas is extracted from underground sources and distributed by pipework throughout most parts of the UK. It consists of hydrocarbon gases – mainly methane – and generally contains no sulphur or contaminants. Although distribution pipework is required on-site, together with a housing for metering and pressure regulating equipment, there are no handling or storage costs. However, in many cases, the CHP plant will need to incorporate specialist equipment to boost the supply pressure of the gas, and this can consume significant amounts of electrical power.
Natural gas is suitable for a very wide range of combustion equipment, including boilers, gas turbines, gas engines, and compression-ignition engines operating in dual-fuel mode. Gas is also considered to be the ‘cleanest’ fuel because its exhaust contains lower levels of potentially harmful gases. Although the constituents of natural gas generally remain consistent, there are variations according to the operating practices of the supply system and its gas sources, and these variations may influence the performance and output of some gas turbines and engines.
Distillate Oils
Distillate oils are produced and traded on the world market, and prices are liable to fluctuate as a result of international factors. Gas-oil is the main distillate oil. It is a product of petroleum refining and is specified in Class A2 and Class D of British Standard BS 2869. Gas-oil is widely used in industry throughout the UK, and also forms the basis for diesel fuel for road vehicles. A lighter distillate oil, often referred to as kerosene, is specified in Class A1 of BS 2869.
The properties and composition of gas-oil are more consistent than those of heavy fuel oil. Gas-oil is a much lighter fuel, remaining liquid at normal ambient temperatures and, therefore, easier to store and handle: it is also usable at temperatures down to as low as -10°C. Furthermore, apart from small quantities of sulphur, gas-oil contains effectively no contaminants, although poor combustion can result in a dirty exhaust containing hydrocarbon particle and carbon monoxide emissions. Gas-oil is a suitable fuel for boilers, engines and gas turbines but, because of its relatively high cost, it is not usually an economic option for CHP, except as a secondary or stand-by fuel, or as a pilot fuel for gas-fuelled compression-ignition engines.
Heavy Fuel Oils
Heavy fuel oils are produced and traded on the world market, and prices are liable to fluctuate as a result of international factors. Heavy fuel oils are mixtures of residuals from petroleum refining.These oils are highly viscous liquids, which are almost solid at normal ambient temperatures and need to be heated to facilitate storage and pumping prior to combustion.This is one of a number of oncosts which also include the installation and operation of specialist storage and handling facilities. Heavy fuel oils are suitable for use in boilers, and can also be used in larger diesel engines, as long as the oil has been correctly heated and filtered.
The properties and composition of heavy fuel oils are more consistent than those of coal, and standards have been set which define the main properties of commercial heavy fuel oils and set limits for contaminants, viscosity etc. Commercially available heavy fuel oils comprise Class G and Class H of BS 2869, and these contain sulphur and other organic compounds, plus small amounts of water, sediment and ash. Environmental legislation sets limits to the sulphur content of these fuels if they are to be widely used.
Coal
UK coal is partly deep-mined and partly from opencast sources, and is relatively expensive. Its prices are influenced by the cost of imported coal supplies but are relatively stable. It is generally considered a non-premium fuel for three reasons:
- It contains water, ash, sulphur and other substances that are potentially harmful or corrosive.
- It is more difficult to burn effectively and cleanly, particularly in smaller-scale plants.
- Coal is also more costly to transport, handle and store than premium fuels.
Coal is not a single uniform fuel, and its composition and availability are not consistent. Particular grades of coal, in terms of size and quality, are produced and marketed to suit different applications, and a particular coal user may be supplied from distant sources if more local coals are not of the appropriate for the process. In addition to the costs of purchasing the coal, other costs will be incurred for site storage and handling, ash disposal, meeting environmental requirements etc.
In CHP installations, coal is generally used to fuel steam-raising boilers, and this requires coal with suitable physical properties. Considerable R&D work has gone into the application of specialised combustion systems such as the fluidised bed. Fluidised bed gasifiers may also be used to generate syngas fuel from the coal for direct use in a gas turbine or IGCC. However these technologies are not widely deployed.
Coal is normally purchased on a contract basis, with the price for a given supply over a defined period fixed according to agreed supply conditions.
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