As the election approaches and energy and budgetary issues continue to be high-profile topics at the water cooler and in Congress, Secretary Sam Bodman of the Department of Energy (”DOE”) may be wondering whether the FutureGen project he thought he canceled may have better prospects for realization than the “restructured” FutureGen project he put in its place.

Since Bodman officially pulled the plug on the $1.8 billion state-of-the-art facility slated for Mattoon Illinois, DOE has faced stiff opposition from the project’s Congressional supporters.  Recent actions have included attempts by Congressional supporters to protect or reinstate the FutureGen project in appropriations and supplemental bill language; an ongoing investigation into the timing and basis for DOE’s decision to cancel the FutureGen project; and recent threats by Senator Richard Durbin (D-IL) to block political appointments to DOE until the Bush Administration reverses its position on the FutureGen cancellation or, at least, postpones definitive action for the next Administration.

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On Thursday, July 31, the Department of Energy (DOE) announced it was granting $36 million toward 15 projects aimed at furthering the development of new and cost-effective technologies for the capture of carbon dioxide (CO₂) from the existing fleet of coal-fired power plants.  The 15 projects will focus on five potential carbon capture technologies, including membranes, solvents, sorbents, oxycombustion (flue gas purification and boiler development), and chemical looping.  The proportion of DOE funding for the projects ranges from 75% to 33%, with an average government share of 66% of the projected cost.

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The House Subcommittee on Energy and Air Quality today held a hearing on a bill intended to drive the development and deployment of carbon capture and storage (CCS) technologies as part of an effort to reduce greenhouse gas emissions from coal-based electricity generation (H.R. 6258).

The Carbon Capture and Storage Early Deployment Act (”the Bill”) would allocate roughly $1 billion a year over a ten-year period to private, academic, and governmental entities to accelerate the commercial availability of carbon dioxide capture and storage technologies. The Bill contains detailed provisions for establishment, governance, and operation of a private “Carbon Storage Research Corporation,” which would be responsible for soliciting and issuing grants and awards on a competitive basis. The Bill finances these investments through a mandatory per-kilowatt-hour fee charged to power distribution utilities, calculated based on each utility’s unique fuel mix and resulting carbon emission footprint, which would be passed through to ratepayers without regulatory oversight.

Today’s hearing comes at a time when significant headway on more comprehensive climate change legislation appears unlikely. While hearing participants differed on certain legislative strategy and implementation issues, few appeared to question the underlying assumption that clean coal will need to be part of any long-term climate change solution. Key recurring themes at the hearing included:

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Congress returns from the July 4th holiday this week and will begin the process of wrapping up business for the upcoming August recess and Presidential campaign season. While the Climate Security Act met its demise in June, there is still plenty of deliberating on energy in the Committees on both sides of the Capitol.

The highest profile hearing will likely take place in the Energy and Air Quality subcommittee of the Energy and Commerce Committee on Thursday at 10 AM where a hearing on the Carbon Capture and Storage Early Deployment Act will be held {webcast}. The witness list has not been released at this time.

Chairman Boucher recently introduced H.R. 6258, a bill which would accelerate the development and early deployment of carbon capture and storage systems to utilities. Some environmental groups have expressed their opposition to the bill, but the legislation has gained an important mix of Republican (including ranking member Barton) and Democratic co-sponsors. With Chairman Boucher still promising to produce a bill this year, it is likely that H.R. 6258 will serve as a marker for how coal state Democrats can find agreement with a hard cap on carbon.

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The U.S. Department of Energy (DOE) yesterday announced plans to award $290 million by early December 2008 to advance the development of carbon capture and storage (CCS) technology at coal power plants. This most recent chapter in the “restructuring” of the FutureGen project comes after the Department rejected the billion-dollar, single-site funding model that it had embraced between 2003 and 2007. DOE argues that its shift to multiple smaller grant projects is better for taxpayers and will promote faster commercialization of CCS technology than the larger project.

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A new report identifies end-use electricity efficiency as the most effective and most economical method to bring carbon dioxide emissions back to current levels by 2050. The analysis uses three scenarios - baseline, global stabilization to 2005 levels by 2050 (ACT), and global 50% reduction below 2005 levels by 2050 (BLUE) - to identify the costs and constraints of advancing the technologies needed for reaching a more sustainable energy future.

The 650-page Energy Technology Perspectives: Scenarios & Strategies to 2050 report was developed by the International Energy Agency (IEA) to provide guidance to the world’s energy ministries on setting political, scientific, and financial priorities to bring about a “revolution” in all aspects of energy production and use. Through 17 global “technology roadmaps,” the report seeks to communicate the research, development, and implementation timeframes, the global deployment requirements, and the main areas for policy action and international collaboration needed to guide each technology to its greatest impact potential.

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Just weeks after the G8 Energy Ministers called for “20 large-scale CCS demonstration projects…to be launched globally by 2010,” the US Department of Energy (DOE) formally withdrew from a 5-year partnership with the FutureGen Alliance to develop a model clean-coal energy facility in the United States. While DOE claims it will continue to support a “restructured” FutureGen project (or group of projects), policymakers are rightly concerned with DOE’s decision. With oil and gas prices at record highs, growing calls for the US to reduce its carbon emissions, and abundant domestic coal reserves that could prove impractical in a carbon constrained economy, the US needs to be on the forefront of developing new clean-coal technologies rather than ceding leadership to Europe or China.

The Original FutureGen

In February 2003, President Bush announced a new public-private partnership project to develop a single 275-megawatt coal-fired electric and hydrogen production plant that would utilize and showcase the latest in clean-coal, carbon capture, and coal-to-hydrogen technologies. With an initial price tag of 1 billion dollars, a five-year schedule for construction, and a goal of 90 percent sequestration, the FutureGen program was an ambitious project intended to boost US efforts to find coal-based solutions to US energy needs and climate concerns.

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