Southern Company plans to seize that opportunity with a $2.4 billion, 582-megawatt advanced coal power plant that it began building in Kemper County, Mississippi, this winter. The integrated gasification combined cycle (IGCC) plant will convert coal to clean-burning gases, from which carbon dioxide is easier to remove than the diluted flue gases from a conventional coal plant. Southern has contracted to sell most of its captured carbon dioxide to oil and gas producer Denbury Resources starting in 2014. Southern will also receive $682 million in federal incentives, and Mississippi’s Public Service Commission is allowing it to recover most of its remaining costs from customers.
Seattle-based Summit Power is generating further revenue with the 400-megawatt IGCC plant that it is developing in Penwell, Texas. Summit plans to capture and sell the plant’s carbon dioxide for oil recovery, and is also converting some of its coal-derived gases into urea fertilizer.
But selling carbon dioxide for use in enhanced oil recovery is not an option for plants in much of the eastern U.S. because they lack access to oil fields. Julio Friedmann, director of Lawrence Livermore National Laboratory’s Carbon Management Program, says the lack of revenue from its carbon-dioxide generation was part of what held back AEP’s project. It also helps explain why Charlotte, North Carolina-based Duke Energy has not committed to carbon capture at a $2.9 billion IGCC plant that is near completion in Indiana. “Barring a huge pipeline to the Gulf of Mexico, projects in the Midwest will be disadvantaged,” says Friedmann.
Waltzer says the best hope for moving CCS forward at coal-fired power plants is the new emissions standards for power plants that the U.S. Environmental Protection Agency plans to issue in September. The EPA may, for the first time, include a standard for carbon-dioxide emissions. Waltzer hopes the EPA will match the standard in California, which limits carbon-dioxide emissions to the levels produced by natural-gas-fired power plants. To meet that standard, coal-fired power plants would have to capture roughly two-thirds of their carbon dioxide—exactly what Southern Company plans to do at its Kemper IGCC plant.
In California, meanwhile, government laboratories and utilities have begun to study carbon capture from the natural-gas-fired plants that provide half of the state’s power. That may be essential to help meet California’s goal of reducing greenhouse-gas emissions by 25 percent by 2020 (from 1990 levels).
Ultimately, says Waltzer, CCS will be required on all power plants to achieve the 80 percent reduction by 2050 that many climate scientists argue is needed to hold global warming this century to 2 °C. As Friedmann puts it, “We will not hit the steep abatement targets proposed by many experts and the president without sequestering carbon dioxide from both coal and natural gas.”