DOE - Fossil Energy Techline - Issued on:  February 6, 2006

Fossil Energy Requests $649 Million for FY 2007 Budget


FutureGen, Carbon Management Major Focus of Program Increases for President's Coal Research Initiative

WASHINGTON, DC – The Department of Energy's Office of Fossil Energy FY 2007 budget request of $649 million allocates $281 million for the President's Coal Research Initiative, which includes $54 million for FutureGen, the world's first zero-emissions hydrogen and electricity producing power plant, and $74 million for carbon sequestration.
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Fossil Energy's programs support the President's top initiatives for energy security, clean air, climate change and coal research.  In addition, the appropriation supports the Department's strategic goal of protecting our national and economic security by promoting a diverse supply and delivery of reliable, affordable, and environmentally-sound energy.  FY 2007 Fossil Energy programs:

  • Implement several key Presidential initiatives through partnership with industry to demonstrate advanced, lower cost, effective pollution control technologies at commercial scale;
  • Increase the nation's technological options for reducing greenhouse gases by increasing power plant efficiencies and using the latest carbon management techniques to capture and isolate these gases as  through the Climate Change Technology program;
  • Ensure energy security by producing hydrogen from coal to support and implement the President's Hydrogen Fuel Initiative to develop the technologies to push forward a "hydrogen energy economy."
The President's Coal Research Initiative

Clean Coal is a major component of the National Energy Policy.  It is essential to meeting the rising demand for clean, reliable and affordable electricity for the foreseeable future.  Clean coal R&D will identify the most critical barriers to coal's use in the power sector and demonstrate new, environmentally-sound technologies for coal-based electricity generation.
 
The FY 2007 budget supports the Office of Fossil Energy's ongoing effort to fulfill President Bush's 10-year, $2 billion commitment to clean coal research, with funding for the President's Coal Research Initiative of $281 million.

Clean Coal Power Initiative and FutureGen
Within the President's Coal Research Initiative, the Clean Coal Power Initiative is a key component of the National Energy Policy to address the reliability and affordability of the nation's electric supply, particularly focusing on the nation's power generators, equipment manufacturers, and coal producers to help identify the most critical barriers to coal's use in the private sector.

Included in the FY 2007 budget is $54 million for FutureGen – triple the amount from FY 2006.  FutureGen is the world's first zero atmospheric emissions hydrogen and electricity producing power plant.  This funding request will keep the program on schedule as outlined in the FutureGen report to Congress.

The FutureGen project is a public/private partnership to demonstrate technology ultimately leading to zero emissions power plants (including carbon dioxide) that are fuel-flexible and capable of multi-product output and electrical efficiencies over 60 percent.

The clean coal research and development effort will focus on all the key technologies needed for FutureGen – carbon sequestration, membrane technologies for oxygen and hydrogen separation, advanced turbines, fuel cells, coal-to-hydrogen conversion gasifier related technologies, and other technologies.

There are currently 10 active CCPI projects, six from the first competition, announced in early January 2003, and four from the second, announced in October 2004.  The projects include an array of new cleaner and cheaper concepts for reducing sulfur dioxide, nitrogen oxides, and mercury – the three air pollutants targeted by the Clear Skies Initiative.  A date has not been announced for the planned solicitation for a third round of projects.

Carbon Management  
Carbon management, along with FutureGen, is one of the highest priorities in the Fossil Energy R&D program, as indicated by the nearly $8 million increase from FY2006 in the proposed budget. Total funding is targeted at $74 million in FY 2007. 

Technology developments within the carbon sequestration program are expected to contribute substantially to the President's goal of reducing greenhouse gas intensity by 18 percent by 2012.  The national network of regional partnerships will continue its important work in FY 2007.  This Secretarial partnership initiative has brought together the federal government, state agencies, universities and private industry to determine which options for capturing and storing greenhouse gases are most practicable for specific areas of the country. 

The international, ministerial-level Carbon Sequestration Leadership Forum will continue to execute its mission of gathering data, exchanging information and participating in joint projects to advance carbon sequestration technology.

Hydrogen
The President's Clean Coal Research Initiative includes the production of clean fuels from coal.  Proposed funding for hydrogen from coal as a clean fuel for future advanced power technologies such as fuel cells and transportation systems is $22 million, a slight decrease from the FY 2006 budget. 

Innovations for Existing Plants
This is an invaluable program designed to produce dramatic short-term reductions in emissions of mercury, nitrogen oxide, particulate matter from existing coal plants.  This program also supports the FutureGen program and would receive $16 million in FY 2007 funding under the proposed budget.

Gasification Technology  
The fiscal year 2007 funding request of $54 million will continue to build on prior successes in the Advanced Turbine Systems Program and to develop technologies for gas stream purification to meet quality requirements for use with fuel cells and conversion processes, enhance process efficiency, and reduce costs for producing hydrogen.  The Integrated Gasification Combined Cycle program will develop advanced gasification technologies by 2010 that can produce electricity from coal at 45-50 percent efficiency at a capital cost of $1000/KW 

Fuel Cells
Fuel cell technology receives a $2 million funding increase for FY 2007under the proposed budget of $63.4 million.  This program has the potential to significantly improve environmental performance and energy security as a source of electrical power in stationary plants at or near the end user.  They can reduce critical pollutants well below New Source Performance Standard levels and offer important carbon management advantages because of their low emission and ultra-high operating efficiency.

The Fuel Cells program supports the FutureGen Project through development of cost effective, highly efficient power blocks for coal-based systems.

A major focus of the Fuel Cell R&D program is the continued work of the Solid State Energy Conversion Alliance.  The FY 2007 Budget includes $20 million for the Innovative Systems Concepts/SECA.

Oil and Natural Gas Technology

For the second consecutive year, a careful review of all Fossil Energy programs examined their effectiveness compared to other programs offering more clearly demonstrated and substantial benefits.  As a result, the FY 2007 budget proposes to terminate the oil and natural gas programs.

A Program Assessment Rating Tool assessment of these programs was conducted for the FY 2005 budget and these programs were rated "Ineffective" based primarily on not demonstrating clear results of the research efforts.

Petroleum Reserves

Strategic Petroleum Reserve 
With its 700-million barrel fill target set in FY 2006, the SPR receives a slight proposed budget decrease of $9 million under the proposed budget of $155 million.  The reduction reflects the scheduling of fewer major maintenance activities in FY 2007. 
 
The SPR does not require additional funds in the oil acquisition account for transporting "royalty in kind" oil to the SPR, because these charges are the responsibility of the oil supplier.  Also, the SPR has the authority to "borrow" funds from other Departmental accounts to support an emergency SPR drawdown.
 
Northeast Home Heating Oil Reserve 
This budget was previously funded with carryover funds from past years, but $5 million is being requested in 2007.  Expenditures will continue for leasing commercial storage space in three states, as well as for quality assurance reviews, auction platform assessments, exercises and tests.  The two million barrel reserve remains ready to respond to a Presidential order should there be a severe fuel supply disruption in the Northeast.
 
Naval Petroleum and Oil Shale Reserves
The FY 2007 budget request of $18.8 million funds environmental remediation, cultural resource and equity determination activities required by the Naval Petroleum Reserve-1 (NPR) sales agreement.  The NPR-3 primary focus is to apply conventional oil field management and operations to produce the stripper field to its economic limit.  Revenues in FY 2007 are estimated at $6.6 million.

- End of Techline -

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  • John Grasser, FE Office of Communications, 202-586-6503