Advantages and Disadvantages of Different Power Generating Processes - Case Study Example

Introduction: The Government of Belina is about to embark on a major economic and infrastructural expansion plan with focus on foreign direct investment and the resulting need for the generation of additional power. The Government has appointed our consulting company Karsson to advice them on selecting an ideal power generation source that will be suitable for the economy. In an era of rising concerns for environmental damage and climate change, it is not easy to advice any prospective customer based on economy of generation alone. Many issues have to be addressed before selecting a method that will generate adequate power for the present, have the potential for expansion to meet future needs and is minimally damaging to the environment. Due to the large investment involved, ethical issues that may result in selection of an inappropriate source or power generation is a factor that has to be considered. This is a preliminary report for the Board of Directors of Karsson arguing for a source that will be satisfactory regarding all the parameters mentioned above. It will take into consideration the advantages and disadvantages inherent in different methods of power generation along with ethical issues that have to be taken into consideration. Importance of environmental protection: Annual Greenhouse Gas Emissions by Sector (Annual Greenhouse Gas Emissions by Sector). Greenhouse gases are those which absorb harmful radiation that is given off by the surface of the earth after it absorbs it from the sun’s rays. “Greenhouse [GH] molecules are those that absorb terrestrial radiation, that which is emitted by the Earth’s surface as a result of the warming effect of incoming solar radiation.” (Barrett 2005, p.1037). The greenhouse gases found in the earth’s atmosphere are water (vapour), CO2 or carbon dioxide, methane, nitrous oxide, and ozone. This is given in the decreasing order of absorption with ozone having the least absorption capability. (Ozone plays a major role in blocking UV and other harmful rays from the sun rather than retaining or absorbing from the earth’s surface). This absorption is important to maintain life sustaining temperature. But when levels of these gases increase (due to pollution) the heat generated is more than what is required or safe and ultimately results in the phenomenon called global warming. The chart given above shows the greenhouse emission as per sector or industry. It can be seen that the biggest contributor of greenhouse gases is from power stations. It is true that some methods of generation are more harmful than others and this will be discussed later in this paper. The rise in average global temperature over the past two hundred and thirty years is given below and there is not dispute as to fact that temperatures have increased (cyclically) over this period. It is important that the current proposed power project by the Government of Belina does its part in not contributing to the emission of more greenhouse gases. Hence an appropriate one that can balance the requirements as well as satisfy environmental concerns should be selected. (Global Climate Change: Global Temperatures). There are other practical reasons that concern the selection of an appropriate source of power. Increasing globalization, industrialization and rising levels of prosperity in many economies around the world has resulted in causing wide spread environmental damage and climate change in the world. It has reached a stage where unless concrete actions are taken up to reduce the impact the climate of the world will change forever. Most power generation projects are like the proverbial double edged sword where it will provide much needed power for industrial and domestic use on one hand while it may cause widespread and long lasting ecological damage on the other. The importance of environmental protection can be understood from the fact that the annual World Economic Forum to be held in Davos later this year has the topic of greenhouse gas emissions and resulting climate change as one of the major areas of discussion and action. “International business leaders, together with governments and climate specialists, have drawn up a comprehensive set of recommendations on a post-2012 framework for global climate policy.” (Climate: CEO Climate Policy Recommendations to G8 Leaders). The meet held in 2007 resulted in the formation of the Climate Disclosure Standards Board which has among its representative organizations like the Carbon Disclosure Project, CERES, The Climate Group, The Climate Registry, International Emissions Trading Association, World Resources Institute, and World Economic Forum. The World Economic Forum and other organizations and governments stresses on two areas that need urgent and long term action. They are reduction in carbon emissions and move towards renewable sources of energy along with research that is aimed at creating new technologies that will help attain these two objectives. Power generation projects are capital intensive and are long term in nature and hence accountability regarding environmental protection is a must. In all probability regulations and laws that will require processes low in carbon emissions may also be implemented in the future. It is better to be ready now so that issues with regard to environmental damage will not bother the Government of Belina in the future. Such issues may even jeopardize the whole project (if not selected properly) in a decade or so. Ethical considerations: Ethics play an important part in running a government and also the projects implemented by it. This is more so in case of a large project like power generation. One of the main issues that hamper ethical business practices is corruption that may exist within the government machinery. Costs of corruption and bribery are quite high and the ultimate victim will be the innocent population of the place. Corruption will result in escalating the investment made and will also result in lower quality of plant, machinery and other infrastructure (for example using less cement to mix concrete) used. Most importantly it may result in the selection of a wrong or inappropriate method of power generation. It can scare of efficient bidders who are unwilling to operate unethically or may force them to resort to this means in order to get business. It can also result in oligopoly where only few sellers operate negating the concepts of a free market. It can also result in wastage of scarce resources and may even lead to emergence of organized crime. (Kumar, Kumar Brij and Steinman 1998, p.189). The government of Belina should resort to strong measures in case the bidders act in an unethical manner (like offering bribes to officials) to obtain the contract. An example of such measures can be seen from the action by the government of Singapore when they blacklisted for a period of five years, companies like Siemens, Pirelli, BICC, Marubeni, and Tomen (all power companies) for trying to bribe government officials in the country. Belina should take such or similar bold steps if they detect corruption in while obtaining the project or while implementing it. Unethical practices can also lead to formation of cartels by existing players. Such an instance happened in the Indian state of Maharashtra. The state power corporation was directed by the Supreme Court of India to take steps in dismantling the cartel. The learned court had observed that “We are distressed to see that the power company had been encouraging formation of a cartel and, thus, allowing the rate of transportation of coal to go high up. Unless a power generating company takes all measures to cut down such malpractices, the generation cost of electricity is bound to go higher and ultimately the same would be passed on to the consumers of electricity.” (Ethics and Law: Sc Pulls Up Maharashtra State Power Generation Company. 2008). The ideal way to combat unethical practices is to formulate a strong code of ethics or conduct and see that it is followed scrupulously. Advantages and disadvantages of different power generating processes: A relative study of the different processes by which power can be generated is given here. The main focus will be on the options now available as per the tenders generated for this project. There are six companies are bidding for the tender generated by govt. of Belina. The power generation processes used by these companies are: Nuclear, Wind, LNG (liquefied natural gas), Oil fired and biomass. Even though there are six companies, there are only five kind of power generation because, two companies uses nuclear power for the electricity generation. Comparison study is linked with the town of Belina, where the project is proposed, and is based on the process of power generation, which are adopted by bidding companies. 1. Nuclear Power energy: Usage of nuclear energy for the generation of electricity is a recent technology. In this, Uranium is used as the source of energy in the nuclear power generation. Study of usage of nuclear energy for the electricity generation in the location is given below. It emits comparatively low amount of green house gases such as carbon dioxide (CO2) .So the adverse effect of nuclear power plant to environmental is relatively quite low. The ready availability of the technology is a benefit of nuclear power generation. Another great advantage with nuclear power production is its ability to produce large volume of power. Very low quantity of waste and easier transportation of uranium is also other benefit of nuclear power plants. The risk of radioactive waste is the most dangerous in the process of nuclear power generation. This is very important issue in the nuclear section. The security of the plant is also a threat to people of Belina. Also, it is noted that nuclear energy is not renewable. Here, there are two companies UEROGEN and MINIGEN (bid no.1 & 6) bidding for the nuclear power generation. These two generates electricity with low cost/unit compared to others. This is good for the govt. of Belina to distribute the electricity with low cost, which intends to achieve rapid growth in the country in future. But it is noted that nuclear energy arises the high risk to the people. Also it is noted that availability of uranium is limited and is controlled by a few countries. So the option of nuclear energy is not preferred. 2. Wind: Here the energy of wind is used as the source of energy. Free availability of wind is the main advantage of this kind of plant. Generation of electricity and maintenance of plant are cheap. It is suited for rural area. Wind mill never questions environmental issues. There is a windy corridor near the towns with a steady strong wind throughout the year, which provide raw material to power the turbines. A large number of windmills will be needed to generate adequate power and this will take up space and also be a blot on the landscape. From the bids received, it is clear that the WINDIBER Company (Bid no.2) can make the power with a medium production cost. So this is good choice for that town. Unless there is a severe change in the climate surrounding the town, availability of wind as a very renewable source of energy is the biggest advantage for this type of power generation. 3 .LNG and oil: The usage of natural gas or oil in the production of electricity involves some pros and cons. Source of energy is easy to get. The companies RELROSE and ATISHI (Bid no.3 and 4) has facility to get the source from Middle East by shipping. So LNG or oil is available easily to plant for the production of electricity. Also they can produce the electricity with low/medium cost per unit. But in other side LNG and oil make large contribution in global warming. Both of them produces green house gases. But the air pollution from an oil powered plant is much more extensive than LNG plant. Consequences of air pollution due to the use of this kind of fuels are so dangerous. So in concern with environmental issues the use of LNG and oil is not suit for the town in Belina, where the plant is proposed. In addition to this, the availability of LNG from the seashore area of belina is still not confirmed. Both LNG and oil are not renewable sources of energy. 4. Biomass: This uses the wood and plant (vegetables, and fruits) waste for generating electric power. This can be yielded from agricultural area of belina. With wide area of agricultural land in Belina, the raw material for the biomass plant is easily obtained. Another advantage of this type of power generation is that it will provide a high rate of relatively unskilled employment. It should be noted that education levels in the country in not very high and the availability of technical skill is extremely low. Plants and trees that can produce high heat can be planted. This does not need high skills and will be source of income for the people of the area. But biomass plant plays a major role in the pollution because of the smoke and ash produced. One advantage here is that the ash can be used for other purposes like fertilizing the soil. The rate of the produced electricity is high/medium by NATFUEL (Bid no.5). Conclusion: A review of five types of power generation that uses five raw materials as source has been done here. The main issues that were factored here was environmental and ethical issues. In other words, the economy and the cost per unit are not the only considerations when deciding on a particular source of power. Nuclear energy might probably turn out to be the cheapest. It is also one of the lowest pollutants. The problem is tacking the radioactive waste even though the quantity may be small. Taking into consideration a long term view it is better not to opt for this since other methods of power generation available. Oil and LNG are also not preferred due to the non-renewable nature of the fuels. Oil is also a high pollutant. The best option is to utilize the wind energy that is sufficiently available in the region. This is totally non-polluting and renewable. Maintenance of the plant also does not require high technical skills and local labour can be provided with employment. In addition to wind power, biomass can also be utilized to generate power as a supplement. This will provide a means of additional income or even gainful employment for the people. It is proposed that wind energy be used to generate power for Belina with biomass as a supplementary source. Both are renewable and hence sustainable sources of energy. This report can be concluded with a relevant observation with regard to protecting our environment and upholding our ethical and moral values. ‘We must not any longer shut our eyes to the consequences of our being on earth. Besides moral, ethical and spiritual reasons, at least for the pure will to survive we should consequently strive for a sustainable living and realize it in our personal life.” (Conclusion). Bibliography Annual Greenhouse Gas Emissions by Sector. [online]. Last accessed 23 January 2009 at: http://www.nysforum.org/documents/html/2007/execcommittee/may/enterprisepowerconsumptionreduction_files/textonly/slide9.html BARRETT, Jack. (2005). Greenhouse Molecules, Their Spectra and Function in the Atmosphere: Introduction. [online]. Energy and Environment. 16(6). P.1037. Last accessed 23 January 2009 at: http://www.warwickhughes.com/papers/barrett_ee05.pdf Climate: CEO Climate Policy Recommendations to G8 Leaders. [online]. World Economic Forum. Last accessed 23 January 2009 at: http://www.weforum.org/en/initiatives/ghg/index.htm Conclusion. [online]. Time for Change Last accessed 23 January 2009 at: http://timeforchange.org/pros-and-cons-of-nuclear-power-and-sustainability Ethics and Law: Sc Pulls Up Maharashtra State Power Generation Company. (2008). [online]. Indopia. Last accessed 23 January 2009 at: http://www.indopia.in/India-usa-uk-news/latest-news/460032/EthicsAndLaw/7/20/7 Global Climate Change: Global Temperatures. Last accessed 23 January 2009 at: http://www.nysforum.org/documents/html/2007/execcommittee/may/enterprisepowerconsumptionreduction_files/textonly/slide7.html KUMAR, Brij., KUMAR, Brij Nino., and STEINMAN, Horst. (1998). Costs of Corruption. [online]. Ethics in International Management. P.189. Last accessed 23 January 2009 at: http://books.google.co.in/books?id=hUidsEFUoYEC&pg=PA188&lpg=PA188&dq=ethics+%22power+generation%22&source=bl&ots=EPIfYYEi-7&sig=9kCMj4spjT7lpODntBCMRN-KUnM&hl=en&sa=X&oi=book_result&resnum=3&ct=result#PPA189,M1 Read More