FutureGen to build 'clean coal' plant in Illinois

The $1.8 billion facility will demonstrate a novel technology to fight global warming.

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."

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