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Coal’s Contribution to Distributed Energy Resources

Coal has long been a dominant source of energy worldwide, providing a significant portion of electricity generation. However, as the world transitions towards cleaner and more sustainable energy sources, the role of coal in the energy landscape is being reevaluated. While coal-fired power plants have been criticized for their environmental impact, it is important to recognize that coal can also contribute to distributed energy resources (DERs). DERs are decentralized energy systems that generate electricity closer to the point of consumption, offering numerous benefits such as increased grid resilience and reduced transmission losses. This article explores coal’s potential contribution to DERs and examines the various ways in which coal can be integrated into distributed energy systems.

The Role of Coal in Distributed Energy Resources

Coal-fired power plants have traditionally been large centralized facilities that generate electricity on a massive scale. However, advancements in technology and changing energy dynamics have opened up new possibilities for coal’s role in distributed energy resources. By leveraging the existing infrastructure and expertise associated with coal-fired power plants, coal can be integrated into distributed energy systems in several ways:

  • Combined Heat and Power (CHP) Systems
  • Microgrids
  • virtual power plants (VPPs)
  • Carbon Capture and Storage (CCS)
  • Coal-to-Liquid (CTL) Technologies

Combined Heat and Power (CHP) Systems

Combined Heat and Power (CHP) systems, also known as cogeneration, simultaneously produce electricity and useful heat from the same energy source. Coal-fired CHP systems can be deployed in various settings, including industrial facilities, hospitals, and universities, where the waste heat generated by the power plant can be utilized for heating or cooling purposes. By capturing and utilizing the waste heat, CHP systems significantly improve overall energy efficiency, reducing greenhouse gas emissions and lowering energy costs.

For example, in the city of Stockholm, Sweden, the Värtaverket power plant utilizes coal in a CHP system to provide electricity and district heating to the city. The waste heat from the power plant is distributed through a district heating network, supplying heat to thousands of households and buildings. This integrated approach not only maximizes the utilization of coal but also reduces the reliance on separate heating systems, resulting in significant energy savings.


Microgrids are localized energy systems that can operate independently or in conjunction with the main power grid. They consist of distributed energy resources, such as solar panels, wind turbines, and energy storage systems, that can be combined with traditional power sources like coal-fired power plants. By incorporating coal into microgrids, communities can benefit from the reliability and stability provided by coal’s continuous power generation.

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One example of coal’s integration into microgrids is the Smart Grid Demonstration Project in the city of Masdar, United Arab Emirates. The project combines renewable energy sources, such as solar and wind, with a coal-fired power plant to create a hybrid microgrid. The coal-fired power plant acts as a reliable baseload generator, ensuring a stable power supply even during periods of low renewable energy generation. This hybrid approach allows for a more resilient and sustainable energy system, reducing the reliance on fossil fuels while maintaining grid stability.

Virtual Power Plants (VPPs)

Virtual Power Plants (VPPs) are networks of decentralized power sources that are coordinated and controlled as a single entity. These power sources can include renewable energy systems, energy storage devices, and even traditional power plants like coal-fired facilities. By aggregating multiple distributed energy resources, VPPs can provide grid services, such as frequency regulation and demand response, while also optimizing the utilization of different energy sources.

Coal-fired power plants can play a role in VPPs by providing reliable and dispatchable power generation. While renewable energy sources like solar and wind are intermittent, coal-fired power plants can operate continuously, ensuring a stable power supply. By integrating coal into VPPs, the overall reliability and flexibility of the energy system can be enhanced, enabling a smoother transition to a renewable energy future.

Carbon Capture and Storage (CCS)

Carbon Capture and Storage (CCS) technologies aim to capture carbon dioxide (CO2) emissions from power plants and other industrial sources, preventing them from being released into the atmosphere. CCS can be applied to coal-fired power plants, allowing for the continued use of coal while significantly reducing greenhouse gas emissions.

CCS involves capturing CO2 from the flue gases of coal-fired power plants, compressing it, and then transporting it to a storage site, such as deep underground geological formations. By capturing and storing CO2, CCS mitigates the environmental impact of coal-fired power generation, making it a more sustainable option. Furthermore, the captured CO2 can be utilized for enhanced oil recovery or other industrial processes, creating additional economic opportunities.

Coal-to-Liquid (CTL) Technologies

Coal-to-Liquid (CTL) technologies convert coal into liquid fuels, such as diesel or jet fuel, through a series of chemical processes. These liquid fuels can be used in transportation, providing an alternative to conventional petroleum-based fuels. By utilizing CTL technologies, coal can contribute to reducing the carbon footprint of the transportation sector.

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For instance, in South Africa, the Sasol coal-to-liquids plant produces synthetic fuels from coal, meeting a significant portion of the country’s transportation fuel needs. This approach not only reduces the reliance on imported oil but also utilizes the abundant coal resources available in the region. While CTL technologies have faced criticism due to their carbon intensity, advancements in carbon capture and utilization can further enhance the environmental performance of these processes.

The Benefits and Challenges of Coal’s Contribution to DERs

Integrating coal into distributed energy resources offers several benefits, but it also presents challenges that need to be addressed. Understanding these advantages and limitations is crucial for evaluating the role of coal in the energy transition:


  • Utilization of Existing Infrastructure: Coal-fired power plants already have extensive infrastructure in place, including transmission lines and grid connections. By leveraging this existing infrastructure, the integration of coal into DERs can be more cost-effective and efficient.
  • Reliability and Baseload Generation: Coal-fired power plants provide reliable and continuous power generation, making them suitable for meeting baseload demand. By incorporating coal into distributed energy systems, grid stability can be maintained, especially during periods of low renewable energy generation.
  • Energy Efficiency: Combined Heat and Power (CHP) systems that utilize coal can significantly improve energy efficiency by capturing and utilizing waste heat. This leads to reduced energy costs and lower greenhouse gas emissions.
  • Job Creation and Economic Opportunities: The integration of coal into distributed energy resources can create job opportunities in areas such as plant operation, maintenance, and carbon capture technologies. Additionally, coal-to-liquid (CTL) technologies can contribute to energy independence and economic growth by utilizing domestic coal resources.


  • Environmental Impact: Coal-fired power plants are associated with significant environmental challenges, including air pollution, greenhouse gas emissions, and water usage. While technologies like carbon capture and storage (CCS) can mitigate some of these impacts, they come with their own set of challenges, such as high costs and limited storage capacity.
  • Transition to Renewable Energy: As the world moves towards a cleaner and more sustainable energy future, the long-term viability of coal in distributed energy resources may be limited. The integration of coal should be seen as a transitional solution, with a focus on gradually phasing out coal in favor of renewable energy sources.
  • Public Perception and Acceptance: Coal has faced significant public opposition due to its environmental impact and association with climate change. The integration of coal into distributed energy resources may face resistance from communities and stakeholders who prioritize renewable energy and decarbonization.
  • Technological Advancements: The successful integration of coal into distributed energy resources relies on the development and deployment of advanced technologies, such as carbon capture and utilization. Continued research and innovation are necessary to improve the efficiency and environmental performance of coal-based DERs.
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While coal-fired power plants have been criticized for their environmental impact, it is important to recognize that coal can still contribute to distributed energy resources (DERs). By leveraging the existing infrastructure and expertise associated with coal, it can be integrated into various distributed energy systems, such as combined heat and power (CHP) systems, microgrids, virtual power plants (VPPs), carbon capture and storage (CCS), and coal-to-liquid (CTL) technologies.

The integration of coal into DERs offers several benefits, including the utilization of existing infrastructure, reliability in baseload generation, improved energy efficiency, and job creation. However, challenges such as environmental impact, the transition to renewable energy, public perception, and technological advancements need to be addressed.

As the world transitions towards a cleaner and more sustainable energy future, the role of coal in distributed energy resources may be limited in the long term. However, in the short to medium term, coal can play a transitional role, supporting the integration of renewable energy sources and ensuring grid stability. The key is to strike a balance between utilizing coal’s existing assets and infrastructure while actively pursuing the development and deployment of cleaner energy technologies.

Ultimately, the successful integration of coal into distributed energy resources requires a comprehensive and holistic approach that considers the economic, environmental, and social aspects of energy systems. By embracing innovation and collaboration, we can navigate the complexities of the energy transition and build a more sustainable future.

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