* From a press release…
Governor Bruce Rauner and U.S. Senator Mark Kirk (R-Ill.) [yesterday] released the following statement on the U.S. Department of Energy’s decision to end federal funding of FutureGen, the public-private clean coal project in Meredosia, Ill.:
“We are thoroughly disappointed in the Administration’s decision to hastily end the bipartisan FutureGen project. This decision will block advancements in clean coal and more than 1,000 new jobs in Central Illinois. We will not give up on this state-of-the-art technology and bringing new jobs to the state.”
* The administration’s explanation…
Spokesman Bill Gibbons with the federal agency told The Associated Press the department concluded the project couldn’t meet a September deadline to use its $1 billion in federal stimulus funding.
A spokesman for the FutureGen Alliance said the group has no choice but to shut down because it can’t finish the $1.65 billion project without federal funding.
* Another press release…
U.S. Reps. Rodney Davis (R-Ill.), John Shimkus (R-Ill.) and Aaron Schock (R-Ill.) [yesterday] expressed concern over the U.S. Department of Energy’s decision to end federal funding for FutureGen, a public-private project to retrofit a coal-fired power plant in Meredosia, Ill.
“This week’s announcement by the DOE to abandon FutureGen is another example of wasted stimulus funds and another failed attempt to create ’shovel-ready’ projects,” said Davis. “The administration has failed the people of Central Illinois by wasting hundreds of millions of dollars invested by taxpayers and the private sector. Instead of making it more difficult for companies to create good-paying, energy jobs, the administration should support policies that help companies working to ensure coal remains a viable source of energy for the future.”
“By the Obama Administration’s own estimates, compliance with EPA’s carbon rules hinges on the widespread adoption of carbon capture and sequestration (CCS) technology by coal-fired power plants,” said Shimkus. “It’s incomprehensible that the Administration is, with one hand, requiring coal plants to use CCS while, with the other hand, pulling the plug on a plant designed to demonstrate the technology.”
“The DOEs determination that the FutureGen Project is no longer viable is yet another example of the Obama Administration’s failure to deliver on promises made to the American people during debate of the $1 trillion stimulus.” said Schock. “What is clear is that the administration’s regulatory hostilities to coal-fired power have made it more difficult for investors to regard opportunities like FutureGen as either viable or profitable.”
* Bloomberg…
The Energy Department spent $202 million on the Meredosia, Illinois, plant about 90 miles north of St. Louis.
Investors, however, remain wary of carbon capture projects, which are unproven even as the federal government has spent billions of dollars to make the technology economically viable.
The projects aren’t a “destination for serious financial commitment,” Christine Tezak, an energy analyst at ClearView Energy Partners LLC in Washington, said in an e-mail.
That’s bad news for tackling climate change. While wind and solar power gain market share, they still represent just a fraction of power production. Coal produced about 38 percent of the electricity used in the U.S. in November, the last month figures are available, according to the U.S. Energy Information Administration, which tracks and analyzes federal energy data.
“If we are to have any hope of avoiding the worst aspects of climate change, we need CCS on a whole host of things” from coal plants to factories, Thompson said, referring to carbon capture and storage or sequestration.
* US Sen. Dick Durbin…
U.S. Senator Dick Durbin (D-IL) today released the following statement after learning that the Department of Energy has been forced to cancel federal funding for the FutureGen project due to the FutureGen Alliance’s failure to find agreement with the private partners before the expiration of the $1 billion in funding that was secured for the public-private partnership as part of the American Recovery and Reinvestment Act.
“The Secretary of Energy informed me that because the FutureGen Alliance was unable to secure the private financing necessary to meet the conditions of the project, the Department of Energy has been forced to end their participation. This is a huge disappointment for both Central Illinois and supporters of clean coal technology.
“A decade-long bipartisan effort made certain that federal funding was available for the FutureGen Alliance to engage in a large-scale carbon-capture demonstration project. But, the project has always depended on a private commitment and can’t go forward without it.
“I worked on FutureGen 2.0 believing it would create jobs in Illinois and demonstrate a viable environmentally acceptable use of coal to generate electricity. I am encouraged by the news that the Department of Energy values the injection site in Morgan County as a world class sequestration opportunity. I am hopeful that Illinois will continue to play an integral role in developing this technology.”
Since it was awarded to the State of Illinois in 2007, the FutureGen project has faced a number of challenges including reimagined technology and site relocation. Throughout the course of the project, Durbin has worked to protect the federal funding which required a private contribution organized by the FutureGen Alliance. Recently, the FutureGen Alliance ran into financial hurdles that they have not been able to overcome, such as trouble securing a private-sector loan, difficulty with two major industry partners (Air Liquid and Babcock & Wilcox) and challenges from the Sierra Club and Illinois utilities.
So, there’s a statutory deadline for using that money and Congress hasn’t yet extended the deadline. This could just be a way to prod the House and Senate to pass a bill. But the Bloomberg piece seems to indicate that investors aren’t exactly excited about the whole idea.
- Wordslinger - Friday, Feb 6, 15 @ 9:51 am:
No reason for private capital to chase clean coal when fracking has unleashed an ocean of natural gas.
- anon. - Friday, Feb 6, 15 @ 9:52 am:
This was wasteful pork. I hope it stays canceled.
- A guy - Friday, Feb 6, 15 @ 9:53 am:
Too bad. That area could use the jobs. Coal isn’t going away anytime soon. Hopefully, an angel investor group can help rescue this, but it looks unlikely.
- Dan Johnson - Friday, Feb 6, 15 @ 9:54 am:
It also means you probably shouldn’t complain about stimulus money not getting spent when you voted against the stimulus.
- VanillaMan - Friday, Feb 6, 15 @ 10:01 am:
It is hard to see a return on investment here when the price of energy plummets. I am a strong advocate of finding a way for Illinois coal to be safely used as a source of energy, yet I fully understand why it would be very difficult to uncover private investors.
Fracking has shaken up the energy market permanently. Natural gas is plentiful and a better energy source than oil. We are meeting pollution standards with it. We are not just now an energy independent country, we could easily start to export, giving us billions in tax revenue. We haven’t even began fracking on public lands and yet we’re meeting our current energy needs.
So FutureGen was a very real future if the price of energy remained where it was pre-fracking or if the market did indeed push the price of energy even higher. Right now, the future isn’t it.
Yet we have more carbon energy in Illinois than most anywhere else on the planet. If we could discover a safe and cost-effective way to make Illinois coal as clean or cleaner than fracked natural gas - it would help us a lot.
The private market is not with us right now. It also isn’t with the oil shale in the Rocky Mountain West, or the tar sands fields along the Athabasca. We aren’t the only ones who is being forced to close us shop. Our energy market is no longer supporting renewable energy as we had planned just five years ago. Why spend billions to create a renewable form of energy that at best can only supply 2% of our energy needs in 40 years?
The Germans are killing these future energy project off too, and they have been a leader in environmentalism. The Germans have let their leaders know that they are tired of ponying up billions in higher taxes and not seeing any results.
I want FutureGen to succeed, but, it isn’t 2008 anymore.
- Loop Lady - Friday, Feb 6, 15 @ 10:05 am:
as the enviros say, there aint no such thing as clean coal, especially IL coal…
DOE and Obama got this right. Let’s use the revenue to further renewables so we have a several sources of energy to choose from…
- Rich Miller - Friday, Feb 6, 15 @ 10:11 am:
Dan Johnson+1.
Why don’t we have a “like” button on comments, Miller?
lol
- dupage dan - Friday, Feb 6, 15 @ 10:31 am:
The history of the energy biz is replete with boom and bust cycles. It is the nature of the beast. The search follows the path of least resistance. Nothing new here.
- Anonymoiis - Friday, Feb 6, 15 @ 10:32 am:
Whether it’s a worthy project is debatable. What’s indisputable is that area needs something to keep from dying a slow death
- Anonymous - Friday, Feb 6, 15 @ 10:33 am:
So, the marketplace doesn’t believe in this and the freemarketeers Rauner, Kirk, Davis, Shimkus and Schock are lambasting the ’socialist’ Obama for not putting more government money in? How ironic.
- Mama - Friday, Feb 6, 15 @ 11:11 am:
We need to find other jobs to replace the jobs that were loss.
- Wordslinger - Friday, Feb 6, 15 @ 11:12 am:
The history of the energy biz is replete with examples of energy sources being discontinued and replaced. Coal replaced timber in Europe after Marco Polo saw it burning in China.
And I wouldn’t go long on those whale oil futures.
- Arizona Bob - Friday, Feb 6, 15 @ 11:21 am:
There’s a “clean coal” power plant in downstate Illinois that was put together by local power cooperatives, and located next to a coal mine. It’s been a financial disaster for those involved. The initial cost went from under $2 billion to over $4 billion, power rates are considerably higher than those even from Comed, and this will be a money pit for over three decades.
Over the years I’ve designed high sulfur coal power stations, low sulfur coal power stations, lignite power stations, natural gas power stations, and nukes. Based upon the cleanliness of burn and solid waste production, cost and safety of transportation to the station, operating and fuel costs, and based upon the fact that the US has known NG reserves for over a century of use, NG is clearly the way to go in 2015 for the US. “clean coal” still isn’t beyond the pilot stage for economic feasibility, and this cancelled project won’t bring that goal any closer. Good riddance.
- Ducky LaMoore - Friday, Feb 6, 15 @ 11:26 am:
So sorry that there are rules to using stimulus funds. So sorry the investors couldn’t come to a decision to follow those rules. So sorry that the people who spend their lives trying to protect big money aren’t willing to understand that, particularly for political purposes.
- Keyser Soze - Friday, Feb 6, 15 @ 12:20 pm:
Future Gen was a dumb idea to begin with. But, its baby brother is alive and well at ADM in Decatur where CO2 emissions are being diverted into the deep Earth.
- Pot calling kettle - Friday, Feb 6, 15 @ 2:15 pm:
“Clean coal” has always been an oxymoron. It’s dirty to mine and dirty to burn. You can clean up the emissions, but it’s expensive and you still need to put the waste somewhere. As we develop a better understanding of waste disposal, we learn that nothing ever goes “away” and storing waste has a cost. As we internalize the costs of waste disposal, coal is just becoming too expensive. The technology might work, but if alternative fuels will be less expensive, why bother?
The politicians who claim to be deficit hawks and who typically promote market-based solutions, are showing their hypocritical stripes here. The reason this is sinking is that no one appears to believe it has an economic future, even with government support. It’s time to let it go…
- Going nuclear - Friday, Feb 6, 15 @ 3:16 pm:
While I think the race for new electrical generating capacity will be primarily between natural gas and renewables in the future, I wouldn’t write off carbon capture technologies yet. We may need a few to help make a significant dent in greenhouse gas emissions.
Keep in mind that natural gas is still a fossil fuel, and methane emissions are released during its development, production, transportation and storage.
I’m watching a carbon capture demonstration project down in Houston where a coal-fired power plant is being retrofitted with equipment that will remove carbon dioxide and sell it to nearby oil fields to generate further production in older wells.
- Precinct Captain - Friday, Feb 6, 15 @ 3:22 pm:
It’s a shame that government largess is the only way these so-called “free market” GOPers can find to bring economic development.
- walker - Friday, Feb 6, 15 @ 4:55 pm:
Public funds are best invested with a long term perspective. Private funds are too focused on shorter term results.
This was a Public-Private partnership. The private funding dried up on this one. Disingenuous for Rauner and Kirk to put the blame on the administration.
The price of oil and gas will rise again.