DOE suspends stimulus funding for Calif. carbon-capture project RSS Feed

DOE suspends stimulus funding for Calif. carbon-capture project

The Department of Energy has suspended Recovery Act funding for a California project to trap carbon emissions from a coal-fired power plant, an agency spokeswoman said.

DOE had set aside $408 million for Hydrogen Energy California LLC’s effort to produce power from coal and petroleum coke, trap most of its CO2 emissions, and use the carbon for making fertilizer and stimulating oil wells. Of the total, $275 million was American Recovery and Reinvestment Act dollars.

But DOE says HECA has not met certain benchmarks. The company has, for example, recently said it failed to secure customers for the enhanced oil recovery portion of the project.

That means DOE is withholding $250 million in funding for HECA. DOE has already reimbursed the company $153 million. The agency has said the money was well spent because it has helped enhance knowledge of such projects.

DOE says it made the decision months ago as a way to protect taxpayer money. The agency is leaving the door open to reconsidering its funding decision depending on the project’s progress.

The administration’s focus on researching and developing carbon capture technologies for power plants is part of an effort to make coal viable while also heeding concerns about climate change.

HECA’s woes with Recovery Act money are not unlike those of FutureGen 2.0, a now-defunct carbon capture and sequestration project in Illinois that also failed to meet DOE development benchmarks.

Read full story at E&E Publishing