Texans seek stimulus dollars for West Texas coal plant

March 23, 2009
Houston Chronicle

Lawmakers from Texas are pushing the Department of Energy to use federal dollars from the economic stimulus package to propel the development of a “clean coal” power plant in West Texas.

The group, led by Sen. Kay Bailey Hutchison, R-Texas, told Energy Secretary Steven Chu that federal funding for the planned coal-gasification plant in Penwell, Texas, would create new jobs and hone nascent technology to capture and store carbon dioxide produced when coal is burned.

The project would “result in 2,000 construction jobs, more than a hundred full-time family-wage jobs at the plant itself and hundreds, if not thousands, of engineering and equipment fabrication jobs,” Hutchison and other lawmakers said in a letter to Chu. The Texas Clean Energy Project, as it is known, will help pave the way for other projects worldwide “and can be an example to the nation for the development of clean energy.”

Hutchison and the other lawmakers, including Sen. John Cornyn, R-Texas, Republican Rep. Kevin Brady, Republican Rep. John Culberson and Democratic Rep. Henry Cuellar, are hoping to tap into funding included in the $787 billion stimulus bill that Congress passed last month.

The measure, which did not win approval from Cornyn, Hutchison or any House Republicans, included $1.5 billion for industrial carbon capture projects like the Texas Clean Energy Project. That funding can be doled out in the form of direct grants or loan guarantees.

The centerpiece of the Texas project is a proposed $1.6 billion coal power plant that would use a technology to separate carbon dioxide. The site in Penwell, near Midland and Odessa, was one of four finalists considered for the federal FutureGen initiative to build a clean coal plant.

The new plant would be designed to capture at least 70 percent of the carbon dioxide emitted when coal is burned — a more modest target than planned for FutureGen.

But Chu has signaled that even if zero-emission plants are a far-off goal, he wants to encourage smaller-scale carbon capture projects. That is a sign he might be receptive to the Texas lawmakers’ pitch.

Earlier this month, Chu told the Senate Budget Committee that “we need to pilot existing technologies . . . that can capture some reasonably large fraction” of carbon dioxide, while working toward a goal of capturing 90 percent or more. “I would hope that we could capture 60, 70 percent at the start,” Chu said. “I don’t want to start by saying we have to begin with 90, 95 percent.”

The proposed Penwell plant would be located in the Permian Basin, where companies are injecting more than 30 million tons of carbon dioxide annually to enhance oil recovery in the region.

The Texas lawmakers said the carbon dioxide that would be captured and injected from the plant could further aid oil recovery in the basin.