http://www.planetark.org/dailynewsstory.cfm/newsid/37330/newsDate/19-Jul-2006/story.htmChina to Ban Small Scale Coal-to-Liquid Plants
(no small scale projects converting coal to liquids due to strain on water supply, and no approval of plants under 3 million tonnes per year (tpy) to process coal into transportation fuels, or projects under 1 million tpy to convert coal into methanol, plus plants under 1 million tpy to produce dimethyl ether (DME), a diesel substitute derived from coal, and projects to make olefins from coal under 600,000 tpy will also be banned)
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"All these projects have never counted in the environmental cost. Once oil prices collapse, they would all be doomed," said Yan Kefeng, of Cambridge Energy Research Associates (CERA).
Coal-to-oil plants, for instance, produce large amounts of carbon dioxide. And all coal liquefaction projects are highly water consuming.
"Water resource would be a main deterring factor for the coal liquefaction sector. It's also a main deterrent to China's economic and social development," said the report, adding that water resource per capita in China's coal-producing areas is one-tenth of the national average. <snip>
The chemical (methanol) is used in some Chinese provinces to blend into gasoline, which are at record-high prices. But the liquid, already banned in some states in the United States, corrodes engines, said CERA's Yan.