of coal's cost problems, air pollution, powerplant site restriction, and conversion cost problems. 7. Pennsylvania State University, (Project Specialty Coals): This project will seek to ascertain which components, or coal types, within a given authracite or bituminous coal seam are most reactive in chemical and conversion processes, and then determine practical methods of separating the coal materials so that they may best be used for these special purposes. The remainder of the material will be utilized for conventional combustion or metallurgical purposes. 8. Pennsylvania State/Door-Oliver Co.: Research directed toward development of a treatment plant to demonstrate the economic feasibility of converting coal refuse dumps for direct use in the construction of roads, building materials, and the manufacture of concrete. Additional funds ($125,000) from State of Pennsylvania. 9. Stanford Research Institute: This work is to develop experimentally methods of processing coal by electric induction heating in a fluidized bed. It has the possibility of producing useful and more valuable liquids, gases, and chemicals and is part of OCR's broad investigation of electroprocessing of coal. When coupled with an extremely cheap source of coal-generated power, such as MHD generation, one or all of the various electroprocessing methods has the potential of being the basis for new processing industries located in the coal-producing areas. 10. Union Carbide Corp. (H.P.H.): A unique process employing controlled agglomeration in a fluid bed to produce useful gases from coal at low cost. This is to develop a process to manufacture high-pressure hydrogen needed by other projects we have under development. Use of Carbide's process will make the production of liquids and gases from coal independent of natural gas as a source of hydrogen and may potentially affect the price of the product as much as 10 percent. C. CONTRACTS PROPOSED FOR EXECUTION IN FISCAL YEAR 1967 REPRESENTING EXTENSIONS OF EXISTING OR PAST CONTRACTS 1. FMC Corp.: If work under existing FMC contract continues successfully, and subsequent evaluation and recommendation is to proceed to the design, construction, and operation of a pilot plant on this project, the effort will concentrate at a larger scale-on vis-breaking and catlyst work on the liquid product which emerges from this process, and on a sulfur-free char fuel. 2. Westinghouse Electric Corp.: The work to date has been successful in the production of a small-scale solid electrolyte coal-burning fuel cell. If the additional work in fiscal year 1966 is successful, and a subsequent evaluation and recommendation is to proceed to the design, construction, and operation of a 10-megawatt cell unit, burning pulversized coal or a gas derived from coal (or a combination) the funds projected would be for this purpose. 3. Pittsburgh & Midway Coal Mining Co. (formerly the Spencer Chemical Division project) (Division of Gulf Oil Corp.): To provide funding to complete design work on pilot plant, and initiation of purchases of long-leadtime items of equipment, construction, and operation of a 25-ton-per-day pilot plant. Work on laboratory and process development-unit scale already completed under earlier contract ($1,240,000) was thoroughly and impartially evaluated. Recommendation was to proceed to pilot-plant effort. Prior work produced an excellent quality low-ash product. B.T.U. values were considerably upgraded from original coal used in process, contaminants and noncombustibles almost wholly removed. D. NEW PROJECTS PROPOSED FOR FISCAL YEAR 1967 1. Howard University: This project represents an attempt to capitalize on the low-cost and high-energy value of coal to recapture the railroad locomotive market. Problems of oil contamination and metal abrasion remain to be overcome. In addition, a dependable method of injecting the fuel into the engine in variable metered amounts has not been developed. 2. Market Study (char economics): Successful marketing of char may make a project commercially economic and assist in disposing of the large quantities of char involved. 3. Transportation studies: A significant part of the delivered price of coal to the industrial consumer is transportation cost. It involves many destinations and problems quite different from those encountered with unit train movements. A transportation survey will be developed to see what can be done to lower the transportation cost of coal to industrial users. APPENDIX 'B' A. PROJECTS UNDER CONTRACT AS OF FEBRUARY 16, 1966 1. Atlantic Refining Co.: This process is to adapt the use of coal to the established oil-refinery fluidized coking process to take an overhead stream of gasoline, producing oils, and a bottom stream of char for fuel in adjacent powerplants. In one refinery/powerplant complex, such as Philadelphia (and others) the potential additional coal market is estimated at 20 million tons per year. 2. Bituminous Coal Research, Inc. (gasification) (6. Consolidation Coal Co.; 10. Institute of Gas Tech.; 11. M. W. Kellogg Co.): These projects, while all different in their approach, have the same objective. This is to produce pipeline quality gas for something less than 50 cents per million B.t.u. Successful achievement of this could result in an additional coal market of 100 million tons, or more, per year. Each 1 percent of project 1980 gas requirement will develop a market for about 9 million tons annually. Because large populations are on the east and west coasts close to large coal reserves, it is estimated that as much as 30 percent of the market by 1980, or 270 million tons of coal, should be possible. 3. Booz, Allen & Hamilton, Inc. (industrial coal market analysis): Potential expansion of 10 million tons annually. 4. Combustion Engineering, Inc.: Development of corrosion retardant coals will aid in reducing the cost of electricity to the American public. It would prevents expensive boiler outages. If the project concurrently succeeds in reducing air pollution from coal-fired boilers, major impact would be made on a national problem. 5. Consolidation Coal Co. (gasoline) (16. The Ralph M. Parsons Co.): The purpose of this contract was to expedite the commercial potential of the consolidation coal synthetic liquid fuel process. The successful bench-scale research has indicated a 2-cent-per-gallon reduction under former estimates with a probable refinery rack-sale price of 11 cents per gallon for 100-octane gasoline. A pilot plant has been designed and construction started in October 1965 to obtain data for design of a commercial plant. The pilot plant will be completed during calendar year 1966 and the complete evaluation is scheduled in 1969. An estimated market for 200 million tons of coal annually by 1980 using this process is possible if only 10 percent of the Nation's gasoline is produced from coal. 6. Consolidation Coal Co. (lignite gasification): See A-2 above. 7. FMC Corp. (8. Hydrocarbon Research, Inc.): Both of these projects are designed to produce an oil refinery feed stock-to produce gasoline primarily-plus varying amounts of fuel char. Another objective of the FMC project is to produce a pumpable mixture of char and oil for use in an improved pipeline transportation system. If successful, it is estimated that 20 or more "coal refineries," each consuming perhaps 10 million tons of coal per year may eventually be constructed. The FMC project has been shown to be technically feasible and requires a pilot plant for commercial validation of prior results. 8. Hydrocarbon Research, Inc.: See A-7 above. 9. Iowa State University: This is an investigation of electrical processing of coal using fluidized-bed methods. If hydrogen can be successfully produced, a large market for coal would result in the manufacture of chemicals and hydrogen made from char (carbon, steam, and electricity). The project also supports work on making gasoline and pipeline gas. 10. Institute of Gas Technology: See A-2 above. 11. M. W. Kellogg Co.: See A-2 above. 12. M. W. Kellogg Co.: Coal, as a source of energy, is more economical in many areas than nuclear reactors which have been extensively studied as heat sources for desalination plants. The study is intended to place coal in its proper perspective. 13. Arthur D. Little, Inc. (transportation systems economics): Two separate projects are envisioned which indicate an estimated market for an additional 20 million tons per year. 14. Melpar, Inc.: Anthracite consumption has been declining for many years. This project, intended to develop a process for making low-cost acetylene from anthracite, could result in a substantial chemical industry locating in the anthracite region even though the increase in anthracite consumption need not be large. A plastics industry based on low-cost acetylene can be envisioned with attendant employment, payrolls, and social benefits. 15. Robert R. Nathan Associates: Potential markets for 60 million tons of western coals annually. 16. The Ralph M. Parsons Co.: See A-5 above. 17. Pope, Evans & Robbins: Boilers developed under this contract and now in operation are burning about 500,000 tons of coal annually. The installations were made on the basis of providing lowest energy cost to the consumer. 18. Pope, Evans & Robbins: If the contractor succeeds in this attempt to develop industrial package boilers which prevent pollution of the air from coalfired plants, the social benefits will be huge. In addition, cost of energy to the consumer will be further reduced. 19. Rand Development Corp.: Pilot plant effort to advance the area of sewage and waste treatment may make practicable low-cost sewage treatment for towns and cities, preventing water pollution and encouraging water conservation. New uses of coal are estimated at 1,000 tons per day for every 200 million gallons of sewage treated under the process. A potential market for more than 3 million tons annually is estimated. 20. University of Utah: A general supporting project to determine characteristics of western coals which would permit adaption of OCR processes, originated elsewhere, to the west. It could expedite establishment of any or all of our major liquid, gasification, or power projects in the area. 21. Virginia Polytechnic Institute: This work should further reduce the cost of mining coal, thus tending to curb price increases of all competitive fuels and reduce the cost of electricity to the consumer. It should also enable coal to retain a competitive position in the electric utility market which may otherwise decline if prices of coal advance appreciably. 22. Westinghouse Electric Corp.: This project seeks to develop a coal-burning fuel cell powerplant and shows considerable promise to increase current thermal efficiency from approximately 40 percent to as high as 80 percent. (About 50 years were required to increase efficiency from approximately 20 percent to today's 40 percent.) Technical feasibility has been proven with a 100-watt operating unit, and work developing low-cost cell batteries is approaching success. The next step will be to fabricate a self-sustaining unit, 100-kilowatt plant, to establish thermal balance and heat-transfer characteristics. Assuming success, the final phase will be a pilot scale unit, 10,000 kilowatts for obtaining commercial-plant data proving economic feasibility. Powerplants located in the semiarid West would not require water. 23. Westinghouse Electric Corp. (MHD power): This project is a preliminary technical and economic evaluation of magnetohydrodynamic power generation. Successful development of a coal-fed MHD unit could lead to a powerplant producing fresh water and high-quality fertilizer while operating at 50 plus percent thermal efficiency for electric generation. It is estimated that an initial commercial plant would use 5 million tons of coal per year after 1975. 24. West Virginia University: This project should create a major new market for an electric utility waste, resulting in an overall decrease in the cost of electric power generation and providing an economic incentive to the utilities to improve their air-pollution abatement procedures. B. PROJECTS PROPOSED IN BALANCE OF FISCAL YEAR 1966 1. Aveo (9. Stanford Research Institute): These are both intended to develop systems for producing useful chemicals, including hydrogen, by electrical activation of the coal molecules. Successful development, especially when operated in connection with coal-refinery/powerplant complexes could be 59-523-66-pt. 2--47 highly beneficial to the coal industry. The use of electricity constitutes use of coal to upgrade itself. 2. Bituminous Coal Research, Inc. (ebbulating bed reactor): This system of coal combustion may be able to solve the problems of sulfur and nitrogen emission and thus protect coal's position in large utility and industrial applications where more stringent air-pollution regulations may otherwise pose a threat to such coal markets. 3. Blast furnace fuel injection economics: Potential expansion of markets by 7 million additional tons annually. 4. Eastern Gas & Fuel Associates (coal blending): Success of this work should aid in breaking down barriers to increase use of American coals, improve the balance-of-payments problem, and increase employment in Appalachia and in the transportation industry. 5. Franklin Institute: To develop a novel combustion gasification system; also promises to have air-pollution reduction benefits. 6. Gourdine Systems, Inc.: An electrogasdynamic power generating system seems to be ideally suited to coal (the fly ash is beneficial). If all of the promises of theoretical analysis are confirmed in this development program, there would be great benefits in reduction of power costs, cheapening of EHV transmission, water conservation, air-pollution reduction, and a greatly expanded market for coal-potentially 100 million tons per year 7. Pennsylvania State University (project specialty coals): Success of this project will provide new markets for anthracite and other coals in making chemicals, liquid and gaseous fuels. Success will also increase the technical and economic feasibility of the entire OCR conversion program, thus shortening the period before such processes are commercially exploited on a large scale. or more. 8. Pennsylvania State/Dorr-Oliver Co.: While this project should increase the market for anthracite, its prime potential impact is in creating noncoal jobs in the depressed anthracite area. Success of the project could have the additional impact of reducing both air and stream pollution in the anthracite Appalachian area. 9. Stanford Research Institute: See B-1 above. 10. Union Carbide Corp. (H.P.H.): This is a controlled agglomeration fluid-bed process to produce high-pressure hydrogen at low cost from either coal or char. It is estimated that this will reduce the cost of liquid and gaseous products in other OCR projects. Cost of gasoline may be reduced 11⁄2 to 1 cent per gallon while eliminating the need for natural gas. C. CONTRACTS PROPOSED FOR EXECUTION IN FISCAL YEAR 1967 REPRESENTING EXTENSIONS OF EXISTING OR PAST CONTRACTS 1. FMC Corp.: See A-7, above. 2. Westinghouse Electric Corp.: See A-22 above. Potential use of such fuelcell process with its greater potential efficiency could insure as much as 20 million tons per year of coal. (Coal's share of the expanding utility market at approximately 10 percent growth per year.) 3. Pittsburgh and Midway Coal Mining Co. (formerly the Spencer Chemical Division project) (division of Gulf Oil Corp.): This project demonstrated the technical feasibility of producing a very low-ash, low-sulfur solid fuel from a wide range of coals at low cost. Market surveys indicated a potential market for 25 million or more tons per year as a fuel and graphitecarbon base. Pilot-plant work is needed to prove the process and to provide sufficient product for adequate utilization testing and equipment development data from which full-scale plants might then be built. D. NEW PROJECTS PROPOSED FOR FISCAL YEAR 1976 1. Howard University: This project could return coal to the transportation pic ture with a potential market of several million tons in the railroad industry alone. Its threat would serve to prevent increases in the price of competitive fuels to the consumer. 2. Market study (char economics): Supporting project. 3. Transportation studies: Supporting project. JUSTIFICATION MATERIAL Mr. DENTON. We shall insert pages 1 through 9 of the justifications. (The pages follow:) HIGHLIGHT STATEMENT The Office of Coal Research program proposed for fiscal year 1967 will require funding estimated at $8,237,000. This represents an increase of $444,166 over the $7,792,834 available in fiscal year 1966 (which includes an authorization of $7,220,000 and a carryover balance from fiscal year 1965 of $572,834). Two thousand dollars of the requested increase in fiscal year 1967 funds is to provide for increased pay costs, $17,000 is to provide for small increases in other administrative and supervisory expenses, and $425,166 is to provide for program acceleration. The Office of Coal Research staff is composed of 19 persons. There are four vacancies at the present time. No increase in the present ceiling of 23 is being requested in fiscal year 1967. The 40 contracts which have been executed to date have brought into the coal research program the scientific, professional, and technical abilities and facilities of some of the Nation's outstanding research organizations. Additional proposals are in hand from such organizations and more are continually being received for worthwhile research projects. However, out of almost 400 proposals received to date, OCR has awarded only 40 contracts. The careful evaluation procedures exercised by OCR and the degree of selectivity enable only those which are considered of greatest value to the total OCR program at the time of their selection to go forward to contracts. Many more desirable projects are in a reserve status at any given time, and limitations on available funding preclude action on them. Expanding program needs require careful technical and administrative monitoring of individual research projects. The slight increase in administrative and supervisory expenses proposed for fiscal year 1967 will insure that these tasks are properly performed. OCR's fiscal year 1967 requests provides for estimates of adequate levels of funding for continuing research and development work on existing projects, projects which are scheduled for execution before the end of the current fiscal year, as well as four new projects in fiscal year 1967. The funding estimates also cover proposed scale-up of three projects to the next stage of their development-the pilot plant phase. Appropriation, 1965__. Salaries and expenses Unobligated balance from prior year_. Total available, 1965_. Appropriation, 1966- Unobligated balance from prior year___ Total available, 1966--- SUMMARY OF INCREASES AND DECREASES To provide for increased pay costs for fiscal year 1966 positions___ Net increase, 1967--- Budget estimate, 1967. $6, 836, 000 56, 202 6,892, 202 7,220,000 572, 834 7,792, 834 2,000 17,000 425, 166 444, 166 8, 237, 000 |