Duke Energy has filed testimony with the Indiana Utility Regulatory Commission for a proposed project that would store a portion of carbon dioxide emissions from its Edwardsport coal gasification power plant underground in southwest Indiana.

Earlier this year Duke Energy received permission to study capturing a portion of the plant’s carbon emissions. The company was acting on the climate change and energy bill recently passed in the House, and which is now being considered by the Senate, it said in a statement on Monday. 
“Indiana gets more than 90 percent of its electric power from coal, and our country has hundreds of years of reserves,” said Duke Energy Indiana President Jim Stanley. “The real-world testing of carbon capture and storage is critical to the continued use of an abundant and relatively inexpensive domestic energy source. This is a step toward the important goal of exploring the permanent underground storage of carbon dioxide emissions.”

Duke Energy is proposing to invest approximately $121 million for a detailed characterization of storage sites, including the drilling of multiple wells. The project involves exploring sequestration in deep saline aquifers as well as use in enhanced oil recovery and storage in depleted oil or gas fields. In enhanced oil recovery, carbon dioxide is used to help stimulate oil and gas production underground.

The three-year site characterization would result in about a 1% average customer rate increase phased in between 2010 and 2013, Duke Energy said. If the study is successful, the company plans to ask state utility regulators for permission to implement carbon capture and storage.

In January, Duke Energy applied for a Department of Energy Clean Coal Power Initiative Round 3 grant, which could potentially offset up to 50% of the costs of carbon capture and storage for the Edwardsport project. The U.S. government increased support of this DOE initiative through federal stimulus funding, and the company plans to refile its application in August. Any funds received would be used to reduce customer rate impacts of the project.

“This will be one of the nation’s first demonstrations of carbon capture and storage at a power plant,” Stanley said. “Edwardsport will be one of the cleanest coal-fired plants in the world when it’s completed. It uses advanced technology to turn coal into a cleaner-burning gas, and strips out pollutants before the gas is burned. Our state will be a leader in showing how coal can be used cleanly and effectively to produce electricity.”

Source: Duke Energy