Opening round of DOE’s clean coal competition attracts 36 proposals worth $5 billion


Washington, DC, August 27, 2002 — Calling it “the most striking example yet of industry’s willingness to invest in a new generation of clean coal technologies,” Secretary of Energy Spencer Abraham recently announced that the Department of Energy has received 36 proposals for projects valued at more than $5 billion in the first round of President Bush’s Clean Coal Power Initiative.

“We are especially pleased that these projects propose a variety of advanced technologies that can help meet the President’s Clear Skies and Global Climate Change objectives,” Abraham said. “The proposals tell us that the private sector has a wealth of 21st century ideas to meet the President’s energy and environmental goals.”

The proposals are the first in response to President Bush’s pledge to invest $2 billion in federal funding over the next 10 years to advance technologies that can help meet the nation’s growing demand for electricity while simultaneously protecting the environment.

Coal currently supplies more than half the nation’s electricity and is one of the nation’s most abundant and affordable energy resources. Yet, coal plants face new environmental challenges.

Earlier this year President Bush proposed the most aggressive effort the United States has undertaken to reduce pollution from power plants. His Clear Skies Initiative sets a goal of cutting sulfur, nitrogen, and mercury emissions by 70 percent. At the same time, the President outlined a new approach for reducing greenhouse gases. Included in his Climate Change Initiative is the development of new technologies that can lower the amount of carbon gases released into the atmosphere.

The President’s Clean Coal Power Initiative will provide federal funding to companies to develop and test advanced technologies that can accomplish these and other environmental goals. To begin the program, the Energy Department offered approximately $330 million in matching funds. Private sector proposers must agree to fund at least half the cost of any project selected.

The department will announce its first selections in January. Additional rounds of competition will be open to clean coal technology developers over the duration of the President’s program.

In all, the proposals request more than $1 billion in federal cost-sharing for projects proposed in 20 states.

While some projects are relatively small in scale, others are more complex and highly leveraged with private financing – one proposal, for example, envisions a $1 billion project with slightly more than $100 million requested from the government. Many proposers are requesting the government’s help in financing approximately 40 to 50 percent of a project’s cost.

Repayment plans have been requested from all applicants. Repayment received by the department will help underwrite the government’s future clean coal research.

The Energy Department conducted a major clean coal technology demonstration effort in the 1980s and early 1990s. New pollution control and power generating technologies from that program are now entering the market, but the last projects were selected nearly a decade ago. Since then, significant technological advancements have been made.

“Recently’s power plant operators will confront a host of environmental challenges that didn’t exist 10 years ago,” said Mike Smith, the Energy Department’s Assistant Secretary for Fossil Energy who will oversee the new program. “Fortunately, clean coal research has not stood still, and now we are ready to move a new generation of advanced processes into first-of-a-kind testing.”

Roughly half of the new proposals are for advanced methods for reducing sulfur, nitrogen and mercury pollutants, either by cleaning the exhaust gases of coal boilers or converting the coal into a clean-burning gas. Many gasification technologies also have the advantage of boosting the efficiency of power plants. More efficient plants produce less carbon dioxide, one of the gases that contribute to global warming. These plants also offer the potential to capture carbon dioxide more easily and prevent it from entering the atmosphere.

Other proposals include concepts for co-producing multiple products such as electricity and clean liquid fuels from coal, upgrading coal to improve its quality before it is fed into a power plant, ways to use coal by-products more productively, and improved instrumentation and control systems that can help power plants run at peak efficiencies.

Additional information can be obtained from the Energy Department’s National Energy Technology Laboratory’s web site at http://www.netl.doe.gov/coalpower/ccpi/.

Click here for a list of the project proposals and descriptions.

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