Europe’s Failures Jeopardize Illinois Carbon Capture Project

Reversals of fortune as far away as Finland could jeopardize the future of Illinois’ FutureGen 2.0 project, to which the Obama administration pledged $1 billion in stimulus funds as recently as last August. FutureGen 2.0 began as planned construction of a ground up new 275 megawatt clean coal power generation facility in Mattoon, under the Bush administration. When the estimated price tag for the coal gasification plant of $950 million more than doubled as construction estimates were finalized, FutureGen 2.0 was revised to revamping Ameren Corporation’s 200 megawatt Meredosia coal fired power facility with advanced combustion techniques, a new boiler, and an air separation unit to capture 90% of the carbon dioxide emissions.

Babcock & Wilcox and a group of energy companies proposed a network of pipelines to deliver the sequestered carbon dioxide to a repository in Mattoon, where it would be stored underground, along with emissions from other plants in the region should the commercial scale carbon capture technology prove successful. Now, the failure of two proposed European commercial scale carbon capture power plant projects suggests the Meredosia project may never come off the drawing boards.

Finland’s Fortum Oyj and its partner Teollisuuden Voima Oyj have both backed out of a proposed 565 megawatt carbon capture project at Meri Pori, Finland, because they say the project presents too many technological and financial risks. Also this month, Royal Dutch Shell dropped a proposal for piping carbon dioxide emissions from its Rotterdam area Pernis refinery to a proposed underground storage facility beneath the small village of Barendrecht in The Netherlands. Citing three years of delays and “the complete lack of local support,” Dutch Minister of Economic Affairs Maxime Verhagen announced scrapping of the Barendrecht carbon capture and storage facility.

Last month, Germany’s energy giant E.ON announced it was terminating development plans for carbon capture and sequestration on a commercial scale at its billion and a half megawatt coal fired power plant in Kingsnorth, U.K.

The fact that European technology leaders in industry and government in Finland, Germany, England, and The Netherlands are concluding in rapid succession during the design phase that commercial scale carbon capture and sequestration is not economically viable, combined with Illinois’ own experience of projected cost overruns totaling more than 100% on the original version of FutureGen 2.0, could eventually scotch the Meredosia/Mattoon project, despite political support in both Springfield and Washington, D.C.

Push Me Pull You On Climate Change

With power plant, refinery, transmission grid and factory construction all hanging in the balance, the internal turmoil over climate change policy continues to fracture the Obama administration and Congress. USEPA proposes to regulate CO2 emissions by rulemaking, despite OMB's sharp criticisms of EPA's process and substance in that agency's finding that the gas is a health hazard. Meanwhile, the White House and Congress continue to insist that comprehensive climate change legislation, rather EPA rulemaking, is the way to go.

House Majority Leader Steny Hoyer and House Energy and Commerce Chairman Henry Waxman, still propose to get a bill out of committee before Memorial Day. A deal is in the works to reduce the greenhouse gas emission goal from 20% reduction by 2020 to only 14% reduction, with cap and trade credits going 35% to local electric utilities, 12% to energy intensive steel, aluminum, chemical and glass manufacturing, and 4% or less to the oil and gas producers. The Blue Dog caucus chimes in with a mandate to include nuclear, clean coal, biomass, hydroelectricity and heat from waste as "renewable" sources of electric power. The Blue Dogs also want any legislative renewable energy mandate to take into consideration regional disparities in availability of renewable resources.

Memorial Day is two weeks away.