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Tenaska urges House panel to support carbon control technology
By Wayne Barber, SNL Energy
June 13, 2008 – Technologies exist to limit carbon dioxide emissions from coal, but if the United States does not take advantage of them, then the nation faces sharply rising electricity prices and declining reliability, with baseload generating capacity shrinking as older plants are retired, a Tenaska Inc. official told a House panel June 12.
Tenaska Vice President of Environmental Affairs Gregory Kunkel testified before the House Committee on Natural Resources' Subcommittee on Energy and Mineral Resources. The panel held a hearing on enhanced oil recovery using carbon dioxide.
Tenaska, a privately held energy company based in Omaha, Neb., is actively pursuing development of power plants in Illinois and Texas that use advanced technologies to limit CO2 emissions. This includes capture and geologic storage of the carbon dioxide.
"Construction of the next generation of clean power plants can begin as soon as firm public policies on climate change are established," Kunkel told the subcommittee.
Tenaska is developing the Taylorville integrated gasification combined-cycle plant in Christian County, Ill., which would capture and sequester CO2 underground. It is also developing the Tenaska Trailblazer coal plant in Nolan County, Texas, which would capture CO2 and transport it via pipeline for use in enhanced oil recovery in the Permian Basin petroleum production area.
To encourage these kinds of projects, Kunkel said, Congress and energy regulators must focus on providing clear and certain regulatory policies. "We who are ready to step up and develop clean energy sources cannot be expected to make these multibillion-dollar investments in an energy policy vacuum."
Tenaska favors a cap-and-trade program that include some free allocation of emission allowances for new sources and bonus allowances for early power units with carbon capture and storage; government auction of greenhouse gas emission allowances to regulated entities, with proceeds directed to construction of early carbon capture projects; recognition of the climate control value of enhanced oil recovery; and tax benefits for major carbon capture equipment.
"Technologies to produce electricity virtually emission- and greenhouse gas-free are here today, and, as demonstrated by our proposal to build the Trailblazer plant, Tenaska is willing to be at the forefront of development," Kunkel said.
"Here, we have well thought-out plants" that are waiting for a "policy roadmap in the form of law," Kunkel said in a subsequent interview.
With natural gas around $12 per MMBtu, technology that can utilize low-cost coal for baseload generation while controlling CO2 is vital, Kunkel said.
The Taylorville IGCC is further along in the regulatory process, as it already has an air permit, Kunkel said. However, the company faces an obstacle in finding customers for the output of the plant in that Illinois law does not allow utilities to buy power for residential and small industrial customers under long-term contracts.
The recent defeat of an Illinois House bill that would have addressed the issue is a setback for the Taylorville project. Kunkel said that if a federal policy was enacted on carbon, it would clearly establish the viability of coal projects with carbon capture. There is always some risk with newer technology, and federal policy should include "some protection for early adoption," he said.
The Taylorville IGCC would be located about 60 miles from Mattoon, Ill., where the
FutureGen Industrial Alliance Inc. wants to build the FutureGen IGCC. Earlier this year, the U.S. Department of Energy dropped its support for the research-based IGCC with carbon capture and instead offered to provide financial support to carbon storage projects at privately backed IGCCs.
Kunkel said Tenaska has filed comments with DOE on its revised carbon capture program and would be interested in receiving federal backing for either Taylorville or Trailblazer. It remains to be seen whether the revised DOE effort will yield federal support on a timetable that works for the Tenaska projects, he added.
Tenaska does not expect a draft air permit for the Trailblazer project until this fall, Kunkel said. Tenaska has also filed for a transmission interconnection for the Texas project.
Published by SNL Energy, www.snl.com
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More information about the Tenaska Trailblazer Energy Center go to www.tenaskatrailblazer.com. |
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