Release Date: May 4, 2001

The coal-fueled power industry has responded enthusiastically to the first new government competition for clean coal technology projects in more than eight years.

In a limited competition that is likely to be the precursor to President Bush's new 10-year commitment to advanced clean coal technologies, the Department of Energy has received 24 proposals for projects totaling nearly $535 million, $251 million of which is requested from the Federal government.

The department is offering $95 million for the initial competition called the Power Plant Improvement Initiative. The private sector must at least match the government's share. Proposed projects would be sited in at least 15 states (some proposers did not designate a site).

"The private sector's response to this initial program is a strong sign that President Bush's commitment to clean coal technology is well-founded," said Secretary of Energy Spencer Abraham. "This country will have a much stronger, more reliable electric industry if we keep coal in the power mix. New technology is the way to do that, and these proposals tell us that the power industry agrees."

U.S. consumers obtain more than half their electricity from coal. Many of the nation's 450 coal-fired power plants could generate more power by installing new technologies developed in recent years, such as better burners or new computerized control systems. Others could avoid premature shutdowns by installing more effective or lower cost pollution control technologies.

The new program is intended to share the risks of these unproven technologies with the expectation that the first-of-a-kind demonstrations will spur other power companies to replicate the new technologies. It was included by Congress in the department's FY 2001 appropriations bill.

In its recent budget, the administration proposes to increase funding for clean coal technology. For FY 2002, the department is requesting $150 million for what Energy Secretary Spencer Abraham has called a "downpayment" on President Bush's pledge to invest $2 billion in clean coal power generation over the next 10 years.

The Federal government ran a similar clean coal technology demonstration program from 1986 to 1993, ultimately sharing the costs of 38 first-of-a-kind projects. The original program, however, was oriented toward less stringent environmental standards in place at the time and covered a wider range of coal-based utility, industrial and fuel applications.

The new focus is on coal for power generation. In addition to meeting tougher environmental regulations and improving the reliability and output of coal-fired power plants, several projects propose technologies to reduce emissions, such as mercury, that were not regulated at the time of the original program.

A panel of technical, procurement and legal experts at the Energy Department's National Energy Technology Laboratory will evaluate the candidate projects using criteria such as the proposed technology's readiness, the management approach, cost considerations, environment, health and safety benefits, and the technology's potential for being replicated in commercial markets. The department plans to announce selections in August.