Remarks by
Spencer Abraham
Secretary of Energy
U.S. Department of Energy
to the
National Coal Council
on
May 14, 2003

On May 16, 2001, two years ago this Friday, President Bush unveiled his National Energy Plan, a vision for meeting our nation's increasing demand for dependable, affordable, and environmentally sound energy.

The President's plan offered more than 100 specific recommendations to increase domestic energy, diversify energy sources, modernize conservation efforts, and upgrade our national energy infrastructure.

Many of the recommendations have already been completed and because of that we are dramatically improving our energy security.

We have, for example, made significant progress toward diversifying foreign energy sources. We have enhanced energy trade relationships with our neighbors, Canada and Mexico. And we are working closely with Russia, the states of the former Soviet Union, and with new and existing trading partners in Latin America and Africa.

We won congressional approval for development of the Yucca Mountain waste depository, which was an important step toward maintaining the viability of nuclear power.

The Department of Energy has conducted the National Transmission Grid Study, which assessed major bottlenecks in our nation's electricity transmission system and recommended 51 ways to help eliminate them.

We have also begun construction to expand and upgrade California's Path 15 transmission line to help relieve a serious bottleneck in the flow of electricity from Southern to Northern California.

The Bush Administration is making significant progress in conservation, energy efficiency, and expanding the use of clean, renewable energy. We are seeking more funding for energy efficiency and renewable energy programs this year than Congress appropriated last year or any year during the last 20 years.

And more. Indeed, progress is occurring on some 96 of the Plan's 105 recommendations.

Those recommendations that have not been fulfilled require congressional action. These include opening a tiny portion of the Arctic National Wildlife Refuge to environmentally benign exploration and development, authorizing the President's hydrogen fuel initiative, laying the groundwork for the continued viability of greenhouse friendly nuclear energy, and taking action to modernize the laws affecting our electricity sector.

We need Congress to finish its job soon, so the President's vision of 21st century energy security can be fully achieved.

No area reflects the progress we are making more than the work done on coal-related issues.

I think it's fair to say that prior to the development of our Energy Plan the role of coal in our energy future was uncertain.

Although it is our nation's most abundant source of fossil energy, concerns about public health and the environment, as well as greater statutory and regulatory hurdles to production and use, had raised serious questions about the viability of coal.

As we began developing our National Energy Plan, it became clear to me and others in the Administration that there was too much emphasis being placed on natural gas, and not enough on the technological advances that can lead to significant, cost-effective systems for controlling coal emissions.

When the Energy Plan was released, it echoed this view.

The President's Plan recognized "the importance of looking to technology to help us meet the goals of increasing electricity generation while protecting the environment."

The Plan recommended the establishment of what became known as the President's Clean Power Initiative, which will provide $2 billion over a 10-year period to companies that develop and test technologies that improve power plant generation efficiencies and greatly reduce emissions.

Industry interest in the initiative has been tremendous.

And last January we announced the first eight projects, valued at more than $1.3 billion, to participate in the President's Clean Coal Power Initiative. These projects will address a variety of challenges such as reducing carbon dioxide by boosting the fuel use efficiency of power plants.

The promise of coal is tremendous and my Department will continue to aggressively pursue these advanced clean coal technologies. But improving the operations of today's coal infrastructure is not our only goal.

During the last six months the Bush Administration has moved beyond our initial recommendations with visionary initiatives borne of the principles established in the National Energy Plan.

One of the most important of these new initiatives is a strong program to advance carbon sequestration as a way to manage carbon emissions and protect the environment.

As I reported at our last meeting, the Department of Energy research is focused on the capture, separation, transportation, and storage of CO2 emissions.

Today the Department of Energy is helping to fund the first major carbon sequestration field study in the United States to test whether underground geologic formations might be used in the future to trap carbon gases and isolate them permanently from the atmosphere.

Earlier this year approximately 2,100 tons of CO2 was injected into a depleted, non-producing oil field near Hobbs, New Mexico. Researchers are currently monitoring the CO2 plume to confirm it will remain trapped underground.

A similar and larger Department of Energy supported sequestration field study is also underway in southeastern Saskatchewan, Canada.

The United States is not the only nation pursuing carbon sequestration technology. As demand for coal increases around the world, consuming and producing nations are looking to carbon sequestration as a way to maintain the viability of fossil fuels while protecting the environment.

So last February the President, Secretary of State Powell and I announced the formation of the international Carbon Sequestration Leadership Forum. This initiative will unite governments from around the world and focus attention on the development of carbon sequestration technologies as a means of reducing greenhouse gases, both here at home and around the globe.

By working cooperatively with other fossil fuel consuming and producing nations, we can develop carbon sequestration technologies faster and more economically. This will shorten the waiting period for commercially viable carbon sequestration technologies that can reduce and eventually eliminate atmospheric carbon emissions associated with the production of energy from fossil fuel.

International partnerships that leverage resources, develop technology standards, and unite the world's best minds will be key to our success.

We at the Department of Energy know well the value of international partnerships in the energy arena.

Since July of 2001 we have been working with our international partners to develop a Generation IV nuclear reactor with enhanced passive safety features and a simpler, more economical design. This new reactor will reduce waste and enhance safeguards against proliferation.

And last November the Department of Energy sponsored a Global Forum on Personal Transportation. The Forum brought together representatives from government, industry and academia to explore ways to apply advanced technologies, such as fuel cells, to the world's transportation challenges.

These international partnerships have been highly successful.

The first meeting of the Carbon Sequestration Leadership Forum is scheduled for June, here in our nation's capital. The Department of Energy will co-host the event with the State Department. Several governments have already committed to attending this ministerial level conference and many others have expressed interest in learning more about the Forum and its goals.

Given the importance of carbon sequestration to the future of the coal industry, I know you will have a high degree of interest in learning of any developments that come out of the Forum and we will be sure to keep you informed.

On another front, I know you share my excitement about the fantastic potential of another DOE clean coal initiative - FutureGen.

FutureGen is a $1 billion public-private initiative to design, build, and operate the first coal-fired, emissions-free power plant.

When operational, FutureGen will be the world's cleanest, full-scale fossil fuel power plant.

Using the latest technology, it will generate electricity, sequester greenhouse gases, and provide a new source of clean-burning hydrogen.

Rather than burning coal as today's conventional plants do, the approximately 275-megawatt FutureGen plant will turn coal into a gas and employ new technology to remove virtually all of the resultant air pollutants - sulfur dioxide, nitrogen oxides, and mercury.

Carbon capture and storage technologies will be used to separate carbon dioxide from other gases. Once isolated, the carbon dioxide will be sequestered in underground formations such as those currently being field tested in New Mexico and Canada.

FutureGen will be one of the boldest steps our nation takes toward a pollution-free energy future. Virtually every aspect of this plant will be based on cutting edge technology. The knowledge we gain from the design and construction of the plant will help turn coal from an environmentally challenging energy resource into an environmentally benign one.

The plant will be a living prototype, testing and evaluating new technologies as they emerge from research and development.

The development of these technologies is essential if the world is to stabilize atmospheric concentrations of greenhouse gases.

The International Energy Agency projects a 50 percent increase in worldwide coal use for electricity generation over the next quarter century.

The fact that coal will be a significant world energy resource during the 21st century cannot be ignored. Coal is abundant, it is comparatively inexpensive, and it will be used, especially in the developing world.

Our challenge is to make sure that when it is used, it is clean and safe.

The FutureGen plant will pioneer carbon sequestration technologies on a scale that will help determine whether this approach to 21st century carbon management is viable and affordable.

And it will provide other benefits as well, including the production of hydrogen to power the hydrogen fuel cell cars that President Bush spoke about during his State of the Union Address.

The FutureGen plant should prove to be one of the most important advances in energy production in the first half of this century.

It will allow developed and developing nations alike to take advantage of huge reserves of low-cost coal to power growing economies, improve standards of living, and contribute to the spread of prosperity around the globe.

The potential irony of this is quite remarkable. Who would have thought that a fuel derided by many as a symbol of a passing industrial age, could well turn out to be one of the most important sources of the electricity and clean hydrogen that will fuel a new age?

I know the coal community is extremely excited to know that FutureGen will help lead the nation to its hydrogen future, and that the companies that comprise America's coal industry will have so large a part in turning FutureGen's potential into a reality.

We already have proof of the industry's interest.

I am extremely pleased that four of our largest coal burning utilities, and five of our largest coal producers have formed an alliance that may finance up to 20 percent of FutureGen's $1 billion cost.

More companies are expected to join the alliance.

The Department will also encourage the participation of other coal consuming and producing nations in the FutureGen initiative during the Carbon Sequestration Leadership Forum next month.

And mark my words, the international work we are doing in the area of carbon sequestration, nuclear power, and hydrogen research and development, will have a more profound effect on global climate and emission advancements than any other initiatives on the planet. And it's very significant, I think, that the United Stats is the leader in these efforts.

Viewed on the surface, the energy situation in the United States today seems unchanging.

But beneath this unchanging surface, strong currents of creative activity are running.

In the not-too-distant future, the nation may be dotted with coal-fired plants modeled on FutureGen. They will be producing electricity for a vibrant economy and hydrogen to fuel a growing fleet of clean hydrogen-powered cars.

The energy security and environmental questions that preoccupy us today will be fading as prominent national concerns.

We are moving ahead, and I owe a debt of gratitude to the members of the NCC for your willingness to sacrifice time and effort to advise me and my colleagues at the Department of Energy.

Thank you and your industry colleagues for your cooperation and participation in our plans to ensure that the coal sector continues to make an invaluable contribution to our energy future.

Twenty years from now, when the principles outlined two years ago in the National Energy Plan have transformed the energy world, all of us, in government and in the private sector, will be able to take deep satisfaction from the knowledge that our work contributed to making life considerably better for the American people and the people of the world.