Follow the bouncing ball:
By Mark Clayton, Staff writer of The Christian Science Monitor / December 19, 2007
A solution to America's energy challenge – turning its coal reserves into a clean fuel – is a step closer to reality.
A government-industry alliance announced Tuesday that it would put a $1.76 billion "clean coal" power plant in Mattoon, Ill. By 2013, the plant is expected to start cranking out 275 megawatts of electricity from gasified coal while emitting almost no pollutants and only 10 percent of the carbon dioxide from today's coal-fired plants. The taxpayer-supported project, called FutureGen, joins a global race to develop clean-coal technology.
But it comes at an odd time for the utility industry. Even though the United States agreed this past weekend to pursue an international greenhouse-gas reduction pact, the US government has announced no plans or guidelines for future regulation or taxation for carbon. Facing such uncertainties and escalating costs to build power plants, utilities have scaled back their construction plans, especially for plants powered by coal. The dozen or so proposed plants using clean-coal technology similar to FutureGen – called integrated gasification-combined cycle or IGCC technology – represent less than half the number of plants on the drawing boards just six months ago, analysts say.
"Until there's a carbon policy framework that makes it clear for industry how they can take advantage of the edge IGCC has in carbon emissions over conventional power, this new technology faces the same go-slow approach," says Alex Klein, senior analyst at Emerging Energy Research, a Cambridge, Mass., energy market research firm.
That slowdown could make FutureGen even more key to the future of IGCC technology. If the US is to use its massive coal reserves – estimated to last roughly 200 years – FutureGen-style gasification technology will be vital, many analysts say.
"FutureGen's role has become even more important to the US utility industry as a demonstration of what's possible because of the cost and uncertainty over carbon-emissions regulation that the industry has seen over the past six months," says Steve Jenkins, vice president for gasification services at CH2M Hill, one of the nation's leading engineering firms, based in Denver.
FutureGen is already paying dividends, Mr. Jenkins adds. The massive environmental-impact statement conducted prior to get the Mattoon site approved has laid out an engineering road map for private industry to follow. The statement covered contingencies from tiny leaks to massive releases of CO2.
Unlike a conventional power plant that burns coal and emits carbon dioxide and other pollutants, IGCC plants gasify coal then separate the polluting gases from hydrogen, which is burned and drives turbines, generating electricity.
What happens to the polluting gases, however, is key. FutureGen's main aim is to demonstrate for US utilities – and a consortium of international partners like China – that it's cost-effective to capture 90 percent of the carbon dioxide emissions and pump them into permanent storage deep underground. While other IGCC plants on the drawing boards could do the same, it's unclear that they will.
At least a dozen IGCC plants are planned nationwide with three already in advanced permitting stages in Ohio, Indiana, and Illinois. Even with fewer plants proposed, the US still leads the world with nearly 60 percent of the planned IGCC power plant capacity.
Some environmentalists say utilities should be forced to build IGCC plants that capture and sequester CO2.
"We like FutureGen and think it's a fine project," says John Thompson, head of the Coal Transition Project for the Clean Air Task Force, an environmental group based in Boston. "But since there are actually some commercial plants that use similar technology, though not as advanced, we believe they could and should capture carbon dioxide at some level."
---------------------------------------------------
PRESS RELEASES:
Department of Energy Takes Another Step Forward on FutureGen Project in Mattoon, IL
U.S. Department of Energy, July 14, 2009
Washington, D.C. – The Department of Energy today issued a National Environmental Policy Act (NEPA) Record of Decision to move forward toward the first commercial scale, fully integrated, carbon capture and sequestration project in the country. The Department's decision is based on careful consideration of the proposed project's potential environmental impacts, as well as the program goals and objectives."The carbon capture and sequestration technologies planned for this flagship facility is vitally important to America and the world," said Energy Secretary Steven Chu. "This step forward demonstrates the Administration's commitment to developing clean energy technologies, creating jobs, and reducing emissions of greenhouse gases."
The Record of Decision and a cooperative agreement signed by DOE and the FutureGen Alliance allow the Alliance to proceed with site-specific activities for the project. Over the next eight to ten months, the Alliance will complete a preliminary design, refine its cost estimate, develop a funding plan, expand the sponsorship group, and, if needed, conduct additional subsurface characterization.
Following these activities, which will be completed in early 2010, the Department and the Alliance will decide whether to continue the project through construction and operation. Both DOE and the FutureGen Alliance agree that a decision to move forward is the preferred outcome and anticipate reaching a new cooperative agreement for the full project. Funding will be phased and conditioned based on completion of necessary NEPA reviews.
The Department of Energy's total anticipated financial contribution for the project is $1.073 billion, $1 billion of which would come from Recovery Act funds for carbon capture and sequestration research. The FutureGen Alliance's total anticipated financial contribution is $400 million to $600 million. The total cost estimate of the project is $2.4 billion, consequently, the Alliance, with support from DOE, will pursue options to raise additional non-federal funds needed to build and operate the facility, including options for capturing the value of the facility that will remain after conclusion of the research project, potentially through an auction of the residual interests in the late fall.When fully operational, the facility will use integrated gasification combined cycle technology with carbon capture and sequestration into a deep saline geologic formation. It will be designed to capture 90% of the carbon emissions by the third year of operations but may be operated at 60% capture in the early years to validate plant integration and sequestration capability. This technology should sequester one million tons of CO2 annually when it reaches full commercial operations.
Download the press release
The Record of Decision can be found online at:
www.fossil.energy.gov/programs/powersystems/futuregen/futuregen_rod_071409.pdfLATEST NEWS:
------------------------------------------------------------------------
www.energy.gov/news/9584.htmSeptember 28, 2010
Department of Energy Formally Commits $1 Billion in Recovery Act Funding to FutureGen 2.0
Washington, D.C. - U.S. Energy Secretary Steven Chu today announced that the Department of Energy has signed final cooperative agreements with the FutureGen Industrial Alliance and Ameren Energy Resources that formally commit $1 billion in Recovery Act funding to build FutureGen 2.0. The FutureGen 2.0 project will help to position the United States as a leader in innovative technologies for reducing carbon emissions from existing coal-fired power plants. As part of this new initiative, the Department of Energy will partner with the FutureGen Industrial Alliance to select an Illinois host community for the carbon storage site as well as a geologic sequestration research complex and a craft labor training center. This site could eventually become a regional CO2 storage site in downstate Illinois. The project partners estimate that FutureGen 2.0 will bring 900 jobs to Illinois and another 1,000 to suppliers across the state.
"Today's milestone will help ensure the U.S. remains competitive in a carbon constrained economy, creating jobs while reducing greenhouse gas pollution," said Secretary Chu. "Developing innovative, cost effective carbon capture and storage technologies is critical to the country's transition to a clean energy future."
"This $1 billion federal commitment is a critical step to bringing FutureGen to Illinois. We look forward to demonstrating to the world that we can use one of our greatest natural assets in a way that protects our environment and puts more people to work," Illinois Governor Pat Quinn said.
"If there was any remaining question as to whether FutureGen is really coming to Illinois, today we have the answer," said U.S. Senator Dick Durbin. "Soon, we will announce a process to evaluate the more than two dozen Illinois communities that have expressed interest in hosting the sequestration, research and training facilities for FutureGen 2.0. I thank President Obama and Secretary Chu for their leadership on this project and for putting Illinois at the forefront of cutting-edge technology that will improve the environment and create good-paying jobs."
In August, DOE announced its intention to fund FutureGen 2.0 as part of an integrated strategy to repower America's coal industry. Ameren Energy Resources, Babcock & Wilcox, and Air Liquide Process & Construction, Inc. are leading the project to repower Ameren's 200 megawatt Unit 4 in Meredosia, Illinois with advanced oxy-combustion technology. The plant's new boiler, air separation unit, CO2 purification and compression unit will deliver 90 percent CO2 capture and eliminate most SOx, NOx, mercury, and particulate emissions. The Ameren Energy Resources team estimates that the retrofitting of the plant is expected to create approximately 500 construction jobs and allow Ameren to add approximately 50 workers to the plant staff, once the repowered unit is operational. The FutureGen Industrial Alliance and the Ameren, B&W, and Air Liquide team are developing a technical cooperation agreement to ensure coordination among each element in FutureGen 2.0 and to provide the foundation for rapid commercial deployment for this exciting new technology once this first-of-a-kind facility is operational.
The FutureGen Industrial Alliance, working with the State of Illinois, will develop a permanent CO2 sequestration facility, research and visitors facilities, and a labor training center at the site. The Alliance will also build a CO2 pipeline network from Meredosia to the sequestration site. The pipeline and storage site will transport and store more than 1 million tons of captured CO2 per year. The project partners estimate the new pipeline network is expected to create additional construction and permanent jobs. The pipeline network, along with the storage site to be selected in early 2011, will help to lay the foundation for a regional CO2 network. The Illinois storage site will be used to conduct research on site characterization, injection and storage, and CO2 monitoring and measurement.
The Department of Energy is working with the FutureGen Industrial Alliance, with details to be announced in the coming weeks, to develop a competitive process to select the host for the CO2 storage site, the visitors complex and training center, and vendor(s) to build the pipeline and the injection and monitoring wells.
Follow the Department of Energy on Facebook, Twitter, Youtube and Flickr. Follow Secretary Chu on his Facebook page.
Media contact(s):
(202) 586-4940
------------------------------
But don't we already have a similar facility in southern Illinois? That will power Naperville and other cities.
Coal plant developer feels pressure, caps costs
July 23, 2010 4:16 PM | No Comments
Under pressure to hold down skyrocketing costs that promise more expensive electric bills for dozens of Midwest cities, developers agreed today to cap the construction budget for a massive coal-fired power plant in Downstate Illinois.
The Prairie State Energy Campus already has more than doubled in cost to $4.4 billion since Peabody Energy, the world's largest private-sector coal company, announced plans to build the plant in 2001. Most of those soaring costs are being paid by municipalities including the Chicago suburbs of Naperville, Batavia, Geneva, St. Charles and Winnetka, which invested in the project in hopes of keeping electricity rates low.
Instead, as the Tribune reported July 11, the cities are facing the prospect of higher electric rates to cover the plant's soaring cost overruns, fostering tension between Peabody and municipal partners locked into 28-year contracts.
Without providing details of the new agreement, the management company in charge of overseeing the plant said it had brokered a new deal capping the construction budget at "approximately $4 billion." That amount does not include the project's total costs, including nearby coal reserves, mine development and transmission lines.
"This agreement will provide greater price stability and economic predictability, which will benefit Prairie State owners and the customers they serve," Peter DeQuattro, chief executive officer of the Prairie State Generating Co., said in a prepared statement. The company did not respond to questions.
Municipal officials told the Tribune last month that they would be forced to borrow more money to cover the plant's construction overruns. Some officials said they were pressuring the plant's management company to rein in costs before Prairie State starts generating electricity next year.
One indication of how rates might rise is found in files from the Illinois Municipal Electric Agency, or IMEA, an association of 33 cities that owns a 15 percent stake in the plant. Naperville, St. Charles and Winnetka all buy electricity through the agency.
In documents filed last year for a bond issue, the agency predicted its electric delivery rates to member communities will increase to $63.40 a megawatt hour in 2013, up 30 percent from 2007. Agency officials attributed most of the rate increase to their investment in the Prairie State project and a smaller, less expensive coal plant in Kentucky.
Several officials contacted today said they were still reviewing a thick packet of documents related to the new deal capping the Illinois project's construction budget. "Until we have a chance to digest all the material, we really don't know what the impact will be on our rates," said Geneva Mayor Kevin Burns.
Municipal officials decided to buy into Prairie State in 2007, amid a fierce battle between energy companies seeking to profit from a new wave of power plants. At the time, private investors had begun to abandon dozens of coal plants similar to Prairie State, scared off by rising construction costs and the prospect of tough limits on greenhouse gases that would make the carbon-rich fuel more expensive to burn.
Illinois and Indiana alone have added nearly 2,900 megawatts of pollution-free wind energy since Peabody unveiled its plans for the 1,600-megawatt Prairie State coal plant. The U.S. Energy Department estimates that wind turbines could provide a fifth of the nation's electricity by 2030, up from about 1 percent today.
Prairie State's backers contend the project still is a bargain compared to buying energy on the open market, building a new nuclear plant or relying on cleaner sources of electricity such as natural gas and wind power.
"The new plant will provide our customers with a reliable and low-cost source of electricity for decades to come," Raj Rao, chief executive officer of the Indiana Municipal Power Agency, said in a statement. Rao also chairs the Prairie State board of directors.
In documents, though, the Indiana agency acknowledges that its costs have increased far greater than expected. It currently is seeking approval for $122 million in new debt to cover its share of the latest Prairie State cost overruns. State regulators in 2004 approved an $850 million bond issue that was supposed to be enough to finance three power plants. Now more than three-quarters of the cash is going to Prairie State.
Peabody ended up with just a 5 percent stake in the plant, limiting its liability for the additional costs.
"Prairie State, simply put, is a low-cost energy source," Vic Svec, a company spokesman, wrote in a recent letter to the Tribune. "All baseload power plants have seen significant cost increases related to labor and commodity inflation."
Critics say the project's developers and investors failed to consider the total costs of building a massive new coal plant, including the air pollution it will emit. Moreover, forecasters have dramatically scaled back their predictions for future energy demand, said Howard Learner, president of the Environmental Law and Policy Center.
For the amount of electricity it generates, Prairie State will be cleaner than most of the nation's existing coal plants, some of which date to the 1940s. But each year it will churn more than 13 million tons of heat-trapping carbon dioxide into the atmosphere, an amount equivalent to adding 2 million cars to the nation's highways. Most U.S. power plants emitting that much climate-change pollution date to the 1960s and '70s.
"Beware of a coal company promising you low-cost power," said Bruce Nilles, director of the Sierra Club's national coal campaign. "We predicted four years ago that this was going to be a bad deal for ratepayers. But we never envisioned they would get hosed this bad even before Prairie State generates a watt."
-- Michael Hawthorne
----------------------------------------------------
So the question I have is why do we have two competing plants coming on line and the govt subsidizes one? Is it better technology than the other? Anyone know?
)