Combined Heat & Power Workshop

Columbus, OH -- June 20, 2012

Who we are……

• Largest independent producer of metallurgical coke in the Americas.

• Five facilities in United States– Vansant, VA (Jewell)– Indiana Harbor, IN– Haverhill, OH– Granite City, IL– Middletown, OH

• One Facility in Brazil– Vitoria, Santos Espirito

• Over 5 million tons/year of coke capacity• We also mine coal via multiple mines in VA.

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Our Facilities

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International Operations

(1) SunCoke holds a preferred interest in Vitória and is the operator.

Vitória(1) (2007)320 OvensCapacity: 1,700ktPower: 150 MW

Brazil

Indiana Harbor268 OvensCapacity: 1,220ktSteam: 1,000klbs/hr

Haverhill (2005, 2008)200 OvensCapacity: 1,100ktSteam: 450klb/hrPower: net 46 MW

Granite City (2009)120 OvensCapacity: 650ktSteam: 450klbs/hr

Domestic Operations

Jewell Coke142 OvensCapacity: 720kt

Middletown (2011)100 OvensCapacity: 550ktPower: net 48 MW

SunCoke EnergyHeadquartersLisle, IL

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SunCoke Energy Process

What is Coke?

• Metallurgical coke is an integral part in the manufacture of steel.

• Coke has four important jobs within a blast furnace:– Provide support (Layers of iron ore, limestone, coke, etc.)– Provide heat (Coke combusts within the furnace)– Provide carbon (reactions for making of the steel)– Provide Permeability (to allow air flow and liquid flow)

• Manufacture of steel has always looked for these properties.– Back in the early 1800’s, charcoal provided these needs– As furnaces grew in capacity (and size) charcoal was not

adequate so the industry turned to coke.

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What is Coke? (cont.)

• Metallurgical-grade coal is mined, washed and sent to coke facilities.

• Coal is further crushed to very small particle sizes (1/8” or less) in preparation for charging into a hot coke oven.

• Coal is charged into a hot oven to be converted to coke. Sometimes termed as carbonization.

• Coal over a period of time within the hot confines of a coke oven goes through several transformations as the thermal temperature wave moves through the bed:– Forms a plastic layer that serves to agglomerate the small particles.– Evolves tars and hydrocarbons (Volatile Matter)– The plastic agglomerated mass solidifies into large pieces – Stabilization of the coke into the solid product

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Coke Making

• Has been made for centuries• Originally just mounds of coal, sometimes with dirt over the

mounds to hold in heat (much like some manufacture of charcoal)

• Utilized beehive ovens (so named due to internal shape) which were crude heat recovery.– Were the predominate type for decades in Pennsylvania, West Virginia,

Alabama, Tennessee. Several thousands of these ovens were built and operated.

– Recovered heat for the coking process, but the waste heat, along with pollutants was sent directly to atmosphere.

• Slot ovens for byproduct recovery. Still the way the majority of coke is made worldwide.

• Heat Recovery with waste heat utilization (SunCoke).8

Beehive Coke Oven

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Early Heat Recovery Ovens

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Vinton FurnaceJackson, OH

1875

J. King McClanahan’sImproved Coke Ovens

No waste heat use

Early Heat Recovery Ovens

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Vinton FurnaceJackson, OH

1875

J. King McClanahan’sImproved Coke Ovens

No waste heat use

SunCoke Energy – Horizontal Heat Recovery Oven

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A View Inside…..

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Middletown Operations – First Coke

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Oven Walls

Oven Door

Coke Loaf

Finished Coke Product

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Finished Coke Product

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SunCoke Process

Coke Ovens

HRSG Unit

Economizer

STG

FGD

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HRSG Unit Economizer

FGD

Steam Generation and Flue Gas Cleaning

Crossover Duct

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Shin-Nippon 67 MW Turbine

Brush Generator

Surface Cond

Steam Turbine & Generator

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Haverhill Operations

HRSG Units (5)

FGD System

STG Building

HH1 (2005)

HH2 (2008)

Haverhill 2 Interconnection - PJM

Studies – Total 3− Feasibility Study− System Impact Study (SIS)− Facility Study

Process Length before construction− Approximately 30 months

Cost for project studied at 67 MW− Total Interconnection Study Cost: $213K (plus Letter Of Credit of

$12M)

Revenue Potential− Energy and Capacity Resource

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Middletown Operations

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HRSG Units (5)

FGD System

STG Building

Middletown Interconnection - MISO

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Studies – total 3− Feasibility Study− System Impact Study (SIS)− Definitive Planning Phase (DPP)

Process Length before construction− Approximately 24 months

Cost for project studied at 67 MW− Total Interconnection Study Cost: $280K (plus Letter Of Credit of

$500K)

Revenue Potential− Energy Resource only

Haverhill/Middletown Comparisions

• Both utilize the same STG system.• Middletown’s economizer units are more

advanced resulting in ability to capture more power.

• Middletown is capped at 50MW maximum.• Haverhill transmits all of its generated power to

AEP. Internal power is brought in on a separate feeder line.

• Middletown consumes generated power for internal use and send the rest to Duke Energy.

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SunCoke Energy & PJM

• All control room operators are educated and certified with PJM.– Initial Briefing Seminar– Generation 101 (& Test)– Generation 201 (& Test)– Generation 301 (& Test)– Operations 101 (& Test)– Closed book final exam

• Middletown with the migration from MISO to PJM is deep into the certification process.– December 2012 completion

• Each site has a lead for PJM. Normally the STG Area Manager.• Corporate contacts for PJM.

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Relationship Comparisons

PJM− Excellent relationship− Helpful during all phases− Follow up after project completion− Provide very detailed studies

MISO− Somewhat less involved with customer− Studies not as in depth− No longer involved since Duke has migrated to PJM

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Regulatory Filing and Reporting

• Certification with Power Siting Commission of applicable state considers issues such as noise, visual impact, traffic, economic impacts and effects of the proposed facility on electric grid.

• FERC (Federal Energy Regulatory Commission)– Certification as a “Qualifying Facility” provides the right to sell energy or capacity to

a utility, the right to purchase certain services from utilities, and relief from certain regulatory burdens.

– Market-Based Rate Authority gives permission to sale energy, capacity, and ancillary services in the market.

– Electric Quarterly Reports summarize the sales contracts executed using your market-based rate authority and the transactions under those contracts.

• Department of Energy (with The Energy Information Administration)– EIA-860 survey represents the status of plants and associated equipment at year

end.– EIA-923 survey reports generation, fuel receipts, consumption, quality and cost.

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Questions?.........Thanks….

• Questions?• Thanks to:– Andrew Conway of PUCO– Dr. John Quanci, VP of Technology, SunCoke– Lawander Bradley-Bey, Business Development,

SunCoke

– For more information on SunCoke Energy, please go to www.SunCoke.com

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