- The Osaki CoolGen Project -

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Realization of Innovative High Efficiency and Low Emission Coal Fired Power Plant - The Osaki CoolGen Project - Kenji Aiso Osaki Coolgen Corporation

Outline 1. Background 2. Gasification Technology 3. Osaki Coolgen Project Overview 4. Construction and Commissioning Work Progress

Outline 1. Background 2. Gasification Technology 3. Osaki Coolgen Project Overview 4. Construction and Commissioning Work Progress

Coal-fired Power Generation 1. Background - Current electricity & CO2 emission and 2040 s prospects - 40 000 Coal power Oil power Gas power Total CO2 emissions 35 000 gas Coal CO2 emission[mt-co2] 30 000 25 000 20 000 15 000 10 000 5 000-4 995 9 899 9 598 9 648 9 792 9 911 9 992 1990 2014 2020 2025 2030 2035 2040 Electricity from coal-based power generation 41% (2014) 28% (2040) CO 2 emission from coal-based power generation Source: IEA World Energy Outlook 2015 31% (2014) 27% (2040) Coal-fired power generation in the world : about 30% CO 2 emission from Coal-fired power generation : about 30% Source : IEA World Energy Outlook 2016 New Policies Scenario)

Coal-fired Power Generation 1. Background - Current generation capacity and 2040 s prospects - OECD Europe 184GW 91GW Eastern Europe/ Eurasia 111GW 91GW Middle East 0GW 3GW China 855GW 1,137GW OECD America 321GW 208GW Africa 44GW 80GW India 176GW 451GW Other Asia Oceania 184GW 367GW Prospects of the world Coal-fired power generation capacity Source : IEA World Energy Outlook 2016 New Policies Scenario) Latin America 7GW 12GW Coal-fired power generation capacity in the world 1,882GW 2,437GW 555GW (2014) (2040)

Coal-fired Power Generation Energy self-sufficiency in Japan approx. 6%* Coal-fired generation Essential for the Best Mix energy policy Energy Mix in Japan** Demand of electric power Economic growth Saving energy 196.1TWh - status in Japan - Composition of electrical source 1065TWh Renewable :22-24% Nuclear:22-20% Geothermal :1.0-1.1% Biomass :3.7-4.5% Wind :1.7% PV :7.0 Hydro:8.8-9.2% 1. Background 966.6TWh 980.8TWh LNG:27% Coal:26% FY2013 FY2030 Oil:3% FY2030 *Source : Japan s Energy White Paper 2016 **Source : METI Long-term energy supply-demand outlook(2015.7)

Fuel Cell FC Integrated coal gasification fuel cell combined cycle (IGFC) 1. Background Development Road Map of High Efficiency Low Emissions Coal Power Generation Technology in Japan (MCFC) (SOFC) HRSG Integrated coal gasification combined cycle IGCC) Pulverized coal fired PCF boiler gasifier Steam turbine HRSG Gas turbine Steam turbine Super critical SC 1300 IGCC 1500 IGCC 1700 IGCC Ultra SC USC gasifier Fuel cell Gas turbine 55% CO 2 reduction about 30% 46 ~ 48% CO 2 reduction about 15% Advanced USC A-USC 38% 39 ~ 41% 46 ~ 48% base Steam turbine Efficiency :Net / Higher heating value

Significance of Osaki Coolgen Project Global Sustainable Development We must: Efficiently use low cost coal for increased Power Demand Drastically reduce CO 2 emissions against Global Warming In Resources Importing Countries (as Japan) Coal is indispensable to achieve sustainable power supply 1. Background Development of High Efficient Clean Coal Technology (Step-1) Osaki Coolgen Demonstration Project Oxygen-blown IGCC with high efficiency, environmental performance and reliability (Step-2) IGCC + CO 2 Capture (Step-3) IGFC + CO 2 Capture

Outline 1. Background 2. Gasification Technology 3. Osaki Coolgen Project Overview 4. Construction and Commissioning Work Progress

History of EAGLE gasifier Technical Development Coal Energy Application for Gas, Liquid, and Electricity 2. Gasification Technology 8 OCG Demonstration Plant 1,180t/d FY2016 166MW Osaki EAGLE Pilot Plant 150t/d FY2002 2013 Wakamatsu 3 HYCOL Pilot Plant 50t/d FY1991 1993 Sodegaura Scale Up Process Development Unit 1t/d FY1981 1985 Katsuta

Features of EAGLE Gasifier 2. Gasification Technology Oxygen-blown Two-stage Spiral-flow Gasifier Upper Injector Upper Stage: Oxygen Lean Coal Char Char + CO 2 + H 2 O CO + H 2 Oxygen Lower Stage: Oxygen Rich Coal + O 2 CO 2 + H 2 O Lower Injector 1200 1600 (high temperature to melt coal ash) High Gasification Efficiency & Stable Slag Discharge

Features of EAGLE Gasifier 2. Gasification Technology Oxygen-blown Two-stage Spiral-flow Gasifier Upper Injector Upper Stage: Oxygen Lean Coal Char Char + CO 2 + H 2 O CO + H 2 Oxygen Lower Stage: Oxygen Rich Coal + O 2 CO 2 + H 2 O Lower Injector 1200 1600 (high temperature to melt coal ash)

Applicable Coal Types of EAGLE gasifier 2. Gasification Technology EAGLE EAGLE Gasifier Conventional Gasifier gasifier Pulverized Pulverizing Coal coal Fired fired Sub bituminous coal area EAGLE Pilot Project Achievement Bituminous coal area

Outline 1. Background 2. Gasification Technology 3. Osaki Coolgen Project Overview 4. Construction and Commissioning Work Progress

Project Timeline 3. Overview

Project Scheme 3. Overview METI (~FY2015) Ministry of Economy, Trade and Industry NEDO (FY2016~): New Energy and Industrial Technology Development Organization Subsidy The Chugoku Electric Power Co., Inc. (Energia) Electric Power Development Co., Ltd. (J-POWER) Joint Investment OSAKI CoolGen Corporation STEP1 EPC contract STEP1 EPC contract STEP1 EPC contract Mitsubishi Hitachi Power Systems, LTD. Coal gasifier unit Combined cycle unit Coordinate all units JGC Corporation Gas clean up unit Wastewater treatment Air separation unit Diamond Engineering Co. Ltd. Coal preparation & supply unit

IGCC Process Flow 3. Overview Coal gasification unit Gas clean-up unit Sulfur recovery unit Coal Gasifier Syngas cooler Cyclone Filter Air Limestone absorber Mill Hopper Acid gas furnace Calcium sulfate Air slag Oxygen Air separation unit Compressor Waste water treatment Nitrogen Rectifier Waste water Treat water Sludge Combined cycle unit Air #1 Water scrubber Combustor COS converter Compressor #2 Water scrubber GT Cooling Water DeNOx Acid gas removal ST HRSG Condenser G Flare unit LPG Air Stack

Major Specifications 3. Overview Specification Coal Gasification Unit Gas Clean-up Unit Oxygen-Blown Single-Chamber Two-Staged Spiral-Flow Entrained Bed Coal feed 1,180 ton/day Acid Gas Removal Unit Methyl Di-Ethanol Amine (MDEA) Sulfur Recovery Unit Limestone Wet Scrubbing Air Separation Unit Pressurized Cryogenic Separation Combined Cycle Unit Wastewater Treatment Unit GT (MHPS H100 TIT=1300 C class, adopted Multi-Cluster burner Gross Power Output : 166MW (GT+ST) Gas Clean-up Unit Wastewater Treatment

Completion Image 3. Overview IGCC Demo Plant Existing Equipment CO2 Capture Plant Coal Stock Gas Clean up Gasifier Wastewater Treatment Gas Turbine Air Separation Wastewater Treatment CO2 Capture

STEP1 Targets Item Targets 3. Overview Efficiency Top class Net Efficiency 40.5% (HHV), 42.7%(LHV) Equivalent to Net efficiency 46%(HHV), 48%(LHV),when applied to 1,500 class GT(already developed) in a commercial plant (higher output) Emission Level Coal Variety Compatibility Top class environmental performance SOx : 8ppm NOx : 5ppm Particulate : 3mg/m 3 N (as 16%O 2 equivalent) Applicable to varieties of coal with various ash fusion temperature Plant Reliability Plant Controllability & Operability Economy Aiming at more than 70%/year availability by 5000hrs operation test. Load ramp rate : 1-3%/min. To obtain the prospect that the COE (cost of electricity) of IGCC is the same level as that of USC.

Outline 1. Background 2. Gasification Technology 3. Osaki Coolgen Project Overview 4. Construction and Commissioning Work Progress

Major Events Start of Civil work Power receiving for commissioning Gasifier start-up by coal Start of demonstration Gas turbine start-up IGCC Construction Progress 4. progress FY 2012 2013 2014 2015 2016 2017 2018 Operation Mar May Design, Manufacturing, Construction, Nov DecDec Jan HRSG SGC Gas ASU on Gasifier on site on site site on site cleanup Pressurization unit test on site of piping Jul Nov Apr Jul Mar

Mechanical completion 4. progress (13 th April 2016)

Mechanical completion 4. progress

Commissioning and demonstration content 4. progress FY 2015 2016 2017 2018 Construction Demonstration Integrated Commissioning Major contents GT,ST start up test Coal gasification test Integrated system operation test Performance test Adjustment operability and controllability Demonstration operation 1000hrs, 5000hrs operation test (confirmation of basic performance, reliability, operability and controllability) Confirmation of compatibility of coal variety

Commissioning 4. progress April-2016 Gas turbine start up June Parallel in power grid

Commissioning 4. progress July Gasifier start up by coal August Start of power generation by coal Achievement Gasifier load : 100% Power generation : 166MW (100%)

Next steps for High Efficiency and Low Emission Step2 CO2 capture test (2019-2020) - 17% slip stream test - aiming at high plant efficiency while CO2 is captured in order to optimize steam and auxiliary power Step3 IGFC Integrated coal gasification fuel cell CC - aiming at higher plant efficiency

http://www.osaki-coolgen.jp We would like to express our gratitude to the Ministry of Economy, Trade and Industry (METI), and the New Energy and Industrial Technology Development Organization (NEDO) for continuous support to the Osaki CoolGen Project. We will carry on construction steadily and make our best effort to achieve successful completion of the Osaki CoolGen Project.