Edwardsport IGCC plant

"working out issues"

 

Doug Esamann 

President, Duke Energy Indiana 

From indystar.com

May 16, 2014

Duke Energy’s Edwardsport coal gasification power plant has been built in a “glass house,” subject to intense scrutiny by regulators and the media. We think that’s OK. The plant is a large investment in new technology and customers deserve to know how it’s doing.

First, Edwardsport is operating and serving Hoosiers. One of the most transparent reports about the plant is Duke Energy’s monthly power generation filing with the state. After a strong performance during last August’s heat wave, we had limited operation at Edwardsport during January and February. That generated a lot of media coverage, but the plant’s performance has improved. March operations were the third highest monthly production from the plant since going into service. Preliminary, yet-to-be-filed estimates show that April will surpass the March production numbers.

These reports focus on operating time on gasified coal. They do not include time that the plant has been available to run on natural gas. One of the plant’s advantages is its flexibility to run on either gasified coal, natural gas, or a combination of those fuels.

There’s still work to be done, though, and we’ll continue to improve the plant’s performance. When we declared Edwardsport commercial last June, we stated that time would be needed to build up to the plant’s long-term level of availability. We always have said that these months would be needed to work out technical issues.

Some news coverage also has given the impression that customers would be seeing a 16 percent rate increase on top of current bills. However, the majority of the rate increase is already part of bills; only about 2-3 percent is left. After periodic state regulatory reviews and approvals beginning in 2009, costs have been phased into customer bills.

Finally, it’s important to remember why we built the plant — to use Indiana coal, an abundant source of fuel in our state and nation, to produce electricity cleanly. Traditional coal-burning technology no longer measures up to federal clean air rules, a challenge for states such as Indiana that depend on coal to fuel the majority of its electricity. The Edwardsport project is the largest in the world to gasify coal, strip out many of the pollutants, and then burn that cleaner gas to produce power.

As more coal plants are retired and companies turn increasingly to natural gas, it’s important to have a diversity of fuel sources to minimize the impact of fuel cost volatility to our customers. Edwardsport has had its challenges, but we are committed to working out any issues that arise for a facility that will serve Hoosiers for decades to come.

Doug Esamann

President, Duke Energy Indiana

Coal-based IGCC in the USA - 
A Last Word?

Kemper IGCC demonstrates high cost of "clean coal"

Kemper "is scaring people away"
(from the Wall Street Journal, October 13, 2013)



DE KALB, Miss.—For decades, the federal government has touted a bright future for nonpolluting power plants fueled by coal. But in this rural corner of eastern Mississippi, the reality of so-called clean coal isn't pretty.

Mississippi Power Co.'s Kemper County plant here, meant to showcase technology for generating clean electricity from low-quality coal, ranks as one of the most-expensive U.S. fossil-fuel projects ever—at $4.7 billion and rising. 

Mississippi Power's 186,000 customers, who live in one of the poorest regions of the country, are reeling at double-digit rate increases. And even Mississippi Power's parent, Atlanta-based Southern Co., has said Kemper shouldn't be used as a nationwide model.

Meanwhile, the plant hasn't generated a single kilowatt for customers, and it's anyone's guess how well the complex operation will work. The company this month said it would forfeit $133 million in federal tax credits because it won't finish the project by its May deadline.

Labor and material costs for the Kemper plant exceeded expectations.

One of just three clean-coal plants moving ahead in the U.S., Kemper has been such a calamity for Southern that the power industry and Wall Street analysts say other utilities aren't likely to take on similar projects, even though the federal government plans to offer financial incentives.

Southern recently took $990 million in charges for cost overruns approaching $2 billion. The company's stock has been battered in the past year, and the company's market value has dropped $6.4 billion since April, to $35.8 billion. Mississippi Power's credit rating has dropped to three notches above junk.

Kemper "is scaring people away," says Michael Haggarty, an analyst for Moody's Investors Service in New York.

And clean coal's costs have looked even worse recently in comparison with a new inexpensive alternative: plants fueled by the natural gas unleashed by a U.S. drilling boom. 

Southern last year decided against purchasing a 10-year-old gas-fired plant in Jackson, Miss., that would have generated about as much electricity as Kemper. Another company bought it for $206 million, billions less than Kemper will cost.

By  Rebecca Smith and Cameron McWhirter 

Ed. Note:   Kemper is currently being commissioned on natural gas fuel and will produce saleable energy for Miss. Power customers well before the gasification system is operational.  The KRB "TRIG" gasifier technology being used at Kemper, developed with partial US DOE support, has yet to be demonstrated at commercial scale.