DOE, ABB-CE Agree Not to Continue Clean Coal Technology Project

Project Originally Slated to be Built in Springfield, IL

Washington, DC - The U.S. Department of Energy (DOE) and ABB-Combustion Engineering have mutually concluded that a Clean Coal Technology power project originally planned for Illinois cannot be relocated within the time required by DOE. As a result, the Energy Department has taken steps to close out the project.

DOE had set June 1, 1996, as the deadline for ABB-Combustion Engineering, Windsor, CT, to submit an application to continue the integrated coal gasification combined cycle project. Originally, the project had been proposed for Springfield, IL, but the Illinois site became unavailable when the local utility opted not to purchase the plant's power. ABB-Combustion Engineering had been working with the Tennessee Valley Authority (TVA) for the past two years to resite the proposed plant. Recently, however, TVA decided not to invest in the demonstration project.

While expressing its regrets that the technologically advanced project could not continue, DOE attributed its cancellation to the current caution that pervades much of the U.S. utility industry. Approaching widescale deregulation and increased competition have prompted many power companies to change their investment strategies to near-term, low initial cost projects with very little technical risk.

DOE commended ABB-Combustion Engineering for its efforts to restructure and continue the project particularly during this unprecedented period of industry uncertainty. The plant originally was intended to generate about 65 megawatts of electricity at the Illinois site. ABB-Combustion Engineering had been working with TVA to expand the plant's size to 375 megawatts.

Cancellation of the project, DOE said, should not be viewed as diminishing the potential of advanced clean coal technology. As the nation moves toward cleaner, more efficient power technologies in the 21st century, gasification-based technology such as that proposed for the ABB-Combustion Engineering project will likely become a viable new option for utilities.

Three other projects in the Clean Coal Technology Program are employing similar versions of the technology in plants that are either operating or under construction in Indiana, Florida and Nevada.

DOE said that the economic studies, preliminary design work and commercial cost estimates completed by ABB-Combustion Engineering as part of the project would add to the growing compilation of data that will benefit future coal gasification-based power projects.

The project originally was to cost $270.7 million with DOE supplying 48%, or $129.4 million. The Government's investment to date has been $7.8 million. ABB-Combustion Engineering's funding has totaled $7.9 million.

The $121.6 million of Federal funding made available by the project's cancellation, combined with unspent funds from three previously cancelled projects, will permit the Energy Department to meet the $200 million rescission target approved by Congress for the Clean Coal Technology Program in 1995.

Currently, 20 Clean Coal projects have been completed and 12 are operating or well into construction. Another 8 projects are being designed and one remains in contract negotiations.

-End of TechLine-

For more information, contact:
Robert C. Porter, Office of Fossil Energy, (202) 586-6503, e-mail: robert.porter@hq.doe.gov
or
Hattie Wolfe, Office of Fossil Energy, (202)586-6503, e-mail: hattie.wolfe@hq.doe.gov