Seven States Woo Clean-Coal Power Plant

Seven states are competing with dollars and regulatory breaks to be the host for an estimated $1 billion federal and private energy initiative being billed as the world's cleanest coal-burning power plant.

The research project, called FutureGen, is expected to provide 1,300 construction jobs and 150 facility positions and to generate 275 megawatts of electricity through a process that would eliminate nearly all air pollutants. The plant also would create a nearby, steady market for the host region's coal, and hopes are it will attract related research and businesses interested in the groundbreaking technology.

Financing and tax breaks to win the site selection, expected to be finalized in late summer 2007, are valued from $2.4 million in Kentucky to $164 million in Ohio. Both states have signed an agreement to cooperate regionally if the plant is built in either place.

Other states are sweetening their offers in different ways. In addition to a $20 million appropriation, Texas has passed a law to take legal responsibility for the carbon dioxide that will be captured and pumped underground to reduce the plant's emissions.

 Illinois, North Dakota, West Virginia and Wyoming also are vying for the plant, which is projected to start operation in 2012. A coalition of 10 energy companies is paying a quarter of the construction costs and assisting in the site selection.

The FutureGen power plant is being designed to take advantage of the nation's cheapest and most abundant fossil fuel — coal — and to boost research into hydrogen as an alternative fuel as state and federal officials clamor to wean the country from its need for imported oil and natural gas.

While most new electrical generation has come from natural gas in recent years, coal still provides more than half of the nation's electricity and is experiencing a comeback, especially after two Gulf Coast hurricanes shut down several natural gas pipelines last year and sent power prices through the roof.

Coal production increased in 2004 and hit an all-time high in 2005 after declining from 2001 through 2003, according to the Energy Information Administration.

But FutureGen will employ new technology to turn the coal into a hydrogen-rich gas in order to increase the plant's efficiency and capture air pollutants such as sulfur dioxide and nitrogen oxide, which can be used to create fertilizers or in other industrial products, according to the U.S. Department of Energy.

Hydrogen from the gasified coal also can be used to create electric fuel cells that power cars — another energy innovation that President Bush is promoting.

The plant will be the first ever designed to remove the carbon dioxide during the process and pump it deep underground or use it to help force out trapped oil and natural gas reserves. Carbon dioxide is a greenhouse gas blamed for global warming.

Several states also are moving independently to take advantage of new coal technologies. Pennsylvania is providing state financing to help transform older power plants into ones that produce and burn the gasified coal. The Keystone State also is helping to pay for a $612 million power plant that not only will produce electricity, but also will convert some of the state's 250 million tons of waste coal into 40 million gallons of synthetic diesel fuel per year through a process called liquefaction.

In addition to their application to host the FutureGen plant, West Virginia is coordinating the efforts of its state economic development, energy and environmental agencies to help plan, finance and build new coal processing plants.

The governors of Montana and Wyoming also are promoting their state's coal reserves — in speeches, news reports and talks with energy companies — as a new source of fuel for the country and a new source of revenue for rural communities.