Gasification & IGCC Forum

IGCC In The News

US DOE reaffirms commitment
to Texas Clean Energy Project
despite delays and rising costs

Sources: World Coal (UK)
               Project website

First-of-a-kind plant needs more time to reach financial closing

The Texas Clean Energy Project (TCEP) is an Integrated Gasification Combined Cycle (IGCC) facility that will incorporate carbon capture and storage (CCS) technology in a first-of-its-kind commercial clean coal-fired power plant.
 

TCEP will be a 400 MW power/poly-gen project that will also produce urea for the U.S. fertiliser market and capture 90% of its carbon dioxide (CO2) – approximately 3 million tons per year – which will be used for enhanced oil recovery (EOR) in the West Texas Permian Basin.

The project is being developed by Seattle-based Summit Power Group, which requested a one-year extension of agreements with Odessa, the host city, to provide time to realign the project and re-evaluate costs.

Time is also needed to renegotiate it's power purchase agreement with CPS Energy, it's host utility out of San Antonio.   The original PPA was canceled by the utility in January.

So far, the project has been in development for four years, and now company officials are hopeful another year will help bring the project to financial closing and eventual construction.

During the past four years, the cost of the project has gone from an estimated US$ 2.2 billion to the current figure of US$ 3.5 billion due to increases in labor and materials costs.

Laura Miller, Project Manager for TCEP, had previously been the Mayor of Dallas and during her time in office there acted decisively against coal – derailing plans to build 11 coal-fired power plants in Texas. However, she has embraced the (clean coal) technology offered by the TCEP project and joined the project team. 

But, she admitted, a project of this magnitude often includes unforeseen obstacles as she met with on May 31 with officials of the host city of Odessa, TX.

DOE stresses importance of project

Julio Friedmann, Deputy Assistant Secretary for Clean Coal with the Department Of Enery (DOE), who attended the meeting by conference call, stressed the importance of the project and said that the DOE needs the project to happen. 
 

“The Department of Energy is committed to the Texas Clean Energy Project, part of the U.S. Department of Energy’s portfolio of major clean coal demonstration projects,” Friedmann said in an email.

Miller made sure that the DOE participated in the meeting to help provide an update.  “I wanted Odessa leaders to hear from Washington that this is an extremely important project not only for Odessa but for the whole country,” she said.

Project shines amid new EPA rules

As the US Environmental Protection Agency (EPA) announced its clean energy plan, which will direct reductions in CO2 of 30% through to 2030, the TCEP looks likely to become a beacon of light for the coal industry. 

The industry worries that the EPA rules will decrease utility company’s need for coal – as they transition to lower carbon fuels – yet if commercial gasification plants like the TCEP can be developed and operated effectively, coal will remain a valuable fuel source for years to come.

Tim Profeta, director of the Nicholas Institute for Environmental Solutions at Duke University, said: ““It’s very difficult to perceive a future where we are not using fossil fuels for energy for decades into the future.”

By mandating emission reductions, the EPA hopes to create a regulatory landscape where the technology is adopted as new plants are built, making CCS cost effective over time, explained Profeta.

“It’s also difficult to foresee that we can address our problem of climate change if we do not capture the carbon from those fossil sources,” he added.

US, China, and India

The Environmental Defense Fund’s Jim Marston, who helped shape California’s carbon cap-and-trade programme, said CCS is also critical for emerging energy-hungry economies. “The real opportunity for growth (for clean coal technology) is actually in India and China where they’re continuing to build new coal plants,” he said.

In fact, China is already in this game. The country’s Export Import Bank has agreed to lend the Texas project US$ 2.5 billion dollars, marking its largest foreign investment in the technology.

Supporters of the Texas project say the technology is important right now even if it implies the long term continued use of coal..