Can coal-derived DME reduce the dependence on solid cooking fuels in India?

Abstract

The Indian government is currently promoting and subsidising the replacement of solid cooking fuels with cleaner-burning liquefied petroleum gas (LPG). India is however a growing importer of LPG, the cost of which strongly linked to the prevailing oil price, which makes this program vulnerable to oil price shocks. Dimethyl ether (DME) is a synthetic fuel which may be blended with LPG and, if produced from domestic Indian feedstocks, one way of potentially reducing this vulnerability. A techno-economic analysis of the use of low grade Indian coal for this purpose is described in this paper, and the coal rich state of Jharkhand, where more than 18% of households used coal as a cooking fuel in 2011, was chosen as a study area. Here it was found that, due to higher cooking energy efficiency, the production and use of the DME (together with an associated electricity export) could result in 35% less coal being consumed when compared with a scenario where coal is used for cooking and to generate an equivalent amount of electricity. This analysis further shows that producing DME through this means would likely require oil prices in excess of $72 per barrel to be cost competitive with imported LPG.