Coal Tattoo

AEP puts brakes on touted carbon capture project

Gazette photo by Lawrence Pierce

The New York Times broke the story late last night:

A major American utility is shelving the nation’s most prominent effort to capture carbon dioxide from an existing coal-burning power plant, dealing a severe blow to efforts to rein in emissions responsible for global warming.

American Electric Power has decided to table plans to build a full-scale carbon-capture plant at Mountaineer, a 31-year-old coal-fired plant in West Virginia, where the company has successfully captured and buried carbon dioxide in a small pilot program for two years.

The technology had been heralded as the quickest solution to help the coal industry weather tougher federal limits on greenhouse gas emissions. But Congressional inaction on climate change diminished the incentives that had spurred A.E.P. to take the leap.

Let’s read that last sentence again:

But Congressional inaction on climate change diminished the incentives that had spurred A.E.P. to take the leap.

We’re waiting this morning for an official announcement from Columbus, Ohio-based AEP.

Updated: Jeri Matheny, a spokeswoman for AEP, confirmed the development to me this morning:

We are tabling the project. It’s disappointing that we had to do that. It was a business decision that we had to make.

Updated 2: I’ve posted a copy of AEP’s news release here.

But one thing to be clear about is that the Times seems just a little confused about the size of the project involved here.

Reporters Matthew L. Wald and John M. Broder describe it as a “full-scale carbon-capture plant” at the company’s Mountaineer Power station in New Haven, Mason County. But, they go on to discuss a $668 million project that the U.S. Department of Energy had pledged to provide half of the funds to complete.

Regular readers of Coal Tattoo know that AEP has been working on a test project that would capture and store a small stream of the carbon emissions from Mountaineer, and that the partially DOE-funded expansion was really for a larger pilot project — not for full-scale CCS on the entire facility. As we described previously:

AEP’s Mountaineer Plant CCS project is among the most important tests of technology aimed at controlling greenhouse gas emissions from coal-fired power plants. But, the current test deals with an emissions stream equivalent to only 20 megawatts of the 1,300-megawatt plant. The federal funding would cover about half of the costs of expanding AEP’s chilled ammonia carbon capture process to cover the equivalent of 230 megawatts of the plant. (Still less than 20 percent of the overall facility).

Still, this is a major story … and it’s worth reading how the Times describes the reasons for this AEP decision yet again:

… Congressional inaction on climate change diminished the incentives that had spurred A.E.P. to take the leap.

The Times story elaborated:

Company officials, who plan an announcement on Thursday, said they were dropping the larger, $668 million project because they did not believe state regulators would let the company recover its costs by charging customers, thus leaving it no compelling regulatory or business reason to continue the program.

The federal Department of Energy had pledged to cover half the cost, but A.E.P. said it was unwilling to spend the remainder in a political climate that had changed strikingly since it began the project.

“We are placing the project on hold until economic and policy conditions create a viable path forward,” said Michael G. Morris, chairman of American Electric Power, based in Columbus, Ohio, one of the largest operators of coal-fired generating plants in the United States. He said his company and other coal-burning utilities were caught in a quandary: they need to develop carbon-capture technology to meet any future greenhouse-gas emissions rules, but they cannot afford the projects without federal standards that will require them to act and will persuade the states to allow reimbursement.

An Obama administration source, quoted anonymously by the Times, said:

This is what happens when you don’t get a climate bill.

UPDATED 3: David Hawkins, director of the climate center at the Natural Resources Defense Council, had this reaction to the AEP announcement, telling me in an email:

This decision is bad news for all concerned. While the days are numbered for many coal plants, many others around the world will continue to operate and CCS is essential to cut carbon pollution from those plants. The principle blame for this shortsighted decision belongs to the polluter lobbies who killed climate protection legislation in the last Congress and to the legislators who were cowed by those lobbyists. Unfortunately, climate disruption is not prevented by denying the problem and decisions like the one announced by AEP will add to the disruption we all face.

This project was being touted just the other day by Obama EPA Administrator Lisa Jackson, as an example of the sorts of clean and green energy jobs the administration was helping to create in Appalachia.

[President Obama] has shepherded and stewarded everything form the recovery act which had tens of billions of dollars in investment in cleaner form of energy, including a carbon capture and storage project right in West Virginia at, I think it’s an AEP plant, Mountaineer.

Energy Secretary Steven Chu has likewise touted the AEP-DOE project:

By harnessing the power of science and technology, we can reduce carbon emissions and create new clean energy jobs. This investment is part of our commitment to advancing carbon capture and storage technologies to the point that widespread, affordable deployment can begin in eight to ten years.

But what are West Virginia political leaders like Sen. Jay Rockefeller going to say now? Rockefeller in particular has touted this project (sometimes misstating its size and scope … perhaps the Times got that from him), and has said the nation should put off any limits on greenhouse emissions until projects like AEP’s have a chance to be tested and proven.

All along, though, experts continued to warn that the only way to make CCS a reality would be for our nation’s leaders to put in place some meaningful plan for dealing with the climate crisis, including actual limits on greenhouse emissions. See previous coverage of that here, here and here. And AEP itself has been pretty frank about the fact that it supported congressional action to limit carbon dioxide emission, and felt such a program was needed to make projects like Mountaineer viable.

UPDATED: Here’s a statement just issued by Sen. Rockefeller’s office —

AEP and Alstom have made critical strides in developing clean coal technology. Proving its dedication to the issue, AEP even spent over $100 million of its own money for this CCS research and development project. Because of these efforts, we have learned a great deal that will help us get closer to fully deploying this important technology. Unfortunately, the financing to continue this demonstration project to Phase II just isn’t available. Nonetheless, I sincerely hope and believe that it will lead to other opportunities, and eventually help pave the way to a bright energy future for West Virginia and build jobs in our state.

Coal boosters like Sen. Rockefeller — and the rest of West Virginia’s congressional delegation and other elected leaders — didn’t listen to the experts on CCS, and opposed any sort of climate bill. They continue to oppose any emissions limits regulation from EPA … What was it that White House official told the Times?

This is what happens when you don’t get a climate bill.