FutureGen Clean Coal Project Scrapped

FutureGen Clean Coal Project Scrapped

Feb, 2008  - Energy Secretary Samuel Bodman 
sent America's clean coal program back to square one Wednesday when he 
tossed out the FutureGen low emissions coal gasification plant that the 
Bush administration has supported for the past five years. 
FutureGen is a public-private partnership between the U.S. Energy 
Department and the FutureGen Industrial Alliance, Inc, a non-profit 
consortium of 12 American and international energy companies. 
The site at Mattoon, Illinois, selected after a hard-fought battle with 
two sites in Texas and another in Illinois, was scrapped, and Bodman said 
the FutureGen Alliance will have to compete all over again with other 
commercial power companies and consortia. 
The announcement raised howls of protest from the Illinois congressional 
delegation. Half the delegation declared in a letter to President George 
W. Bush Wednesday that they "have lost confidence in Secretary Bodman." 
"We feel that the Secretary misled us and the people of Illinois, creating 
false hope in a FutureGen project which he had no intention of funding or 
supporting," they told the president. 
"We are writing today to urge you to keep FutureGen on track, so that this 
project can begin construction and become a reality," wrote the Illinois 
elected officials, including Senators Dick Durbin and Barack Obama, both 
Democrats, and Democratic Representatives Jerry Costello, Danny Davis, 
Rahm Emanuel, Phil Hare, and Jan Schakowsky, and Republicans Tim Johnson, 
Ray LaHood, and Peter Roskam. 

Bodman said he now favors "a restructured approach to its FutureGen 
project that aims to demonstrate cutting-edge carbon capture and storage, 
CCS, technology at multiple commercial-scale Integrated Gasification 
Combined Cycle, IGCC, clean coal power plants." 
"Under this strategy," Bodman said, "the U.S. Department of Energy, DOE, 
will join industry in its efforts to build IGCC plants by providing 
funding for the addition of CCS technology to multiple plants that will be 
operational by 2015." 
"This approach builds on technological research and development 
advancements in IGCC and CCS technology achieved over the past five years 
and is expected to at least double the amount of carbon dioxide 
sequestered compared to the concept announced in 2003," Bodman said. 
"The FutureGen concept announced in 2003 planned the creation of a 
near-zero emissions, 275 MW power plant that produced hydrogen and 
electricity from coal on a smaller-than-commercial-scale, serving as a 
laboratory for technology development," said Bodman. 
The FutureGen Alliance today said Bodman's assertions were untrue. "The 
Mattoon site and FutureGen, as currently configured, can sequester 
approximately two million tons per year. The environmental impact 
statement considered as much as 2.5 million tons," said the Alliance. 
"FutureGen is commercial scale," the Alliance said. "The facility will be 
built around a commercial-scale gasifier and commercial-scale frame 7 
turbine." 
In annoucing the restructuring, Bodman raised the issue of government 
funding for FutureGen. "Under this plan, DOE’s investment would provide 
funding for no more than the CCS component of the power plant - not the 
entire plant construction, compared with the FutureGen concept announced 
in 2003 where the federal government would incur 74 percent of rising 
costs." 
Again, the FutureGen Alliance disagrees with Bodman. 
"Project costs have increased, but DOE's share has not doubled - not even 
close. When President Bush first announced FutureGen, the DOE share was 
$800M. DOE's current estimated share is $1.1B with the increase due to 
inflation," the Alliance said today. 
"The Alliance has offered to provide DOE with partial-to-full repayment to 
ease the final cost to the taxpayer. The costs are manageable," the 
Alliance said. 
"Alliance member contributions, thus far, have been cash donations. The 
Alliance has told DOE that it still expects a majority of its 
contributions will come from cash donations. Proposed financing is small 
relative to traditional projects. The Alliance includes some of the 
world's largest companies; DOE's notion that they might default is 
nonsense. The Alliance has fulfilled all its responsibilities thus far," 
the consortium said. 
On Wednesday, FutureGen Alliance chief executive Michael Mudd said, "The 
Alliance remains committed to keeping FutureGen on track." 
In their letter to President Bush, the Illinois congressional delegation 
too challenged the energy secretary's statement that funding concerns are 
behind the withdrawal of support for FutureGen. 
"When the Secretary was assured that we were prepared to provide adequate 
funding and to resolve any other outstanding issues between the 
Administration and the FutureGen Alliance if he would take steps to move 
FutureGen forward, he unequivocally refused. Given that, it is hard to 
believe that cost concerns constitute his real objection to this project," 
the letter states. 
"Many have argued that this abrupt about face by Secretary Bodman was the 
direct result of the FutureGen Alliance choosing Mattoon, Illinois as the 
site, over Texas applicants," the congressional delegation wrote. "While 
we'd like not to believe this theory, there is no other plausible 
explanation." 
The president has not yet commented on the FutureGen controversy. 
The Energy Department today issued a Request for Information that seeks 
industry’s input by March 3, 2008, on the costs and feasibility associated 
with building clean coal facilities that achieve the intended goals of 
FutureGen. 
Bodman said the president's Fiscal Year 2009 budget requests $407 million 
for coal research, including development of more efficient gasification 
and turbine technologies, innovations for existing coal power plants, and 
large-scale CCS injection tests, and $241 million to demonstrate 
technologies for cost-effective carbon capture and storage for coal-fired 
power plants, including $156 million for the restructured FutureGen 
approach and $85 million for DOE’s Clean Coal Power Initiative. 
"This $648 million request represents a $129 million increase from the 
president’s FY2008 request and is the largest amount requested for DOE’s 
coal program in more than 25 years," said the energy secretary. 
The FutureGen Alliance, a non-profit organization, represents some of the 
world's largest coal companies and electric utilities including: American 
Electric Power, Anglo American, BHP Billiton, the China Huaneng Group, 
CONSOL Energy Inc., E.ON U.S., Foundation Coal, Luminant, PPL Corporation, 
Rio Tinto Energy America, Peabody Energy, Southern Company, and Xstrata 
Coal. 

---