DOE Formally Commits $1B to FutureGen 2.0 CCS Project

FutureGen 2.0, the government-backed but long-stalled carbon capture and storage (CCS) project proposed for Meredosia, Ill., will get about $1 billion in cost-shared federal funding, the Department of Energy (DOE) announced on Jan. 22. 

A Record of Decision (ROD) published in the Federal Register marks the DOE’s decision to provide $1 billion of financial assistance to the FutureGen Industrial Alliance, a coalition of coal producers, users, and equipment suppliers. The majority of that funding was appropriated under the American Recovery and Reinvestment Act (ARRA), the ROD notes. The remainder is expected to come from cooperative agreements with the alliance.

FutureGen 2.0’s estimated total project cost is $1.68 billion. The alliance plans to acquire and upgrade one unit of Ameren Energy Resources’ Meredosia Energy Center, near Meredosia, Ill. The repowered 168-MWe unit will include oxycombustion and carbon capture technologies designed to capture at least 90% of its carbon dioxide emissions during “steady state” operation. It is expected to combust a blended mixture of 60% Illinois No. 6 bituminous coal and 40% Powder River Basin sub-bituminous coal.

The captured greenhouse gas would then be transported through a 30-mile pipeline (using existing rights-of-way) to wells where it would be injected about 4,000 feet below ground into the Mt. Simon formation, a geologic saline formation that is one of the Illinois Basin’s major deep saline formations, for permanent storage. The project will be designed to capture, transport, and inject about 1.2 million tons of CO2 annually, the ROD noted.

The DOE-funded demonstration period would last for 56 months from the start of operations—which is now slated for 2017.

In 2012, the Illinois Commerce Commission approved a primary power purchase agreement for FutureGen 2.0 that requires the state’s electric utilities, as well as alternative retail electric suppliers, to purchase electricity from FutureGen 2.0 for 20 years.

The DOE said it is backing the project to “demonstrate the commercial feasibility of an advanced coal-based technology that may serve as a cost-effective approach to implementing carbon capture at new and existing power plants.”

The Obama administration has been criticized for issuing proposed rules that will require new coal units to be CCS-ready, even though no large-scale power generation CCS-integrated projects yet exist. Only two such projects are under construction worldwide—Southern Co.’s Kemper integrated gasification combined cycle (IGCC) power station in Mississippi and the Boundary Dam project in Canada—though neither project’s capture portion of the plant will be fully operational until later in 2014.

On Jan. 16, meanwhile, the Environmental Protection Agency (EPA) submitted a Notice of Data Availability to the Office of Management and Budget (OMB) after Republican lawmakers probed the agency to explain why it based its New Source Performance Standards (NSPS) rule on three government-funded projects when the Energy Policy Act of 2005 prohibits the EPA from considering technology used at Energy Department–backed projects as being “adequately demonstrated” for purposes of Section 111 of the Clean Air Act.

FutureGen 2.0 is a continuation of the original 2003 FutureGen program. The Bush administration abruptly withdrew its support for that project in 2008.

“Without DOE’s investment in this facility, the development of oxy- combustion plants integrated with CO2 capture and geologic storage would be delayed or not occur at all,” the ROD issued last week said.

Sonal Patel, associate editor (@POWERmagazine, @sonalcpatel)