Power & Coal - Regulatory and Legal Developments
| DOE to provide funding for hydrogen-powered IGCC in California |  |
November 06, 2009 5:38 PM ET
By Wayne Barber
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The U.S. Department of Energy could provide up to $308 million to a venture owned by BP Alternative Energy International Ltd. and Rio Tinto to help build and demonstrate a 250-MW hydrogen-fueled power plant in California with carbon capture and storage. DOE said in a Nov. 6 news release that it has signed an agreement with Hydrogen Energy California LLC, the joint venture behind the Hydrogen Energy integrated gasification combined-cycle project in Kern County, Calif. The plant would be fueled by a blend of 75% coal and 25% petroleum coke, which would then be converted into hydrogen and CO2. The hydrogen would be used to power a turbine capable of producing up to 250 MW. About 90% of the CO2 produced from the gasification process, or about 2 million tons per year, would be transported via pipeline to the Elk Hills oil field, less than four miles away, for use in enhanced oil recovery. The estimated capital cost of the project is $2.3 billion. The federal cost-share is limited to $308 million, or just under 11% of the total project costs. The project would create 1,500 construction jobs and 100 permanent operational positions. The alliance between Rio Tinto and the BP plc subsidiary recently signed a technology deal with General Electric Co. Project developers are targeting early 2012 for the start of construction and a late 2015 startup. Sequestration of 2 million tons per year of CO2 is slated to begin by 2016. The California Energy Commission began its 12-month review of the project in August. | 
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