'Clean Coal' Remains an Oxymoron, Unlikely to Change for Years to Come
By JOHN J. FIALKA
Staff Reporter of THE WALL STREET JOURNAL


WASHINGTON -- Clean-burning coal. The phrase quickened pulses in coal country when President Bush uttered it during his fall campaign, and it's getting renewed attention now in his energy plan.

But for all the talk, clean-burning coal will likely remain an oxymoron for years to come. The utility industry, which uses coal to generate 52% of its electricity, faces formidable political, economic and technological obstacles to getting "clean."

Demonstration Projects From the '80s

Not that the government hasn't tried to spur change. During the 1980s, Congress ponied up $2.75 billion for the Department of Energy's Clean Coal Technology program, which sponsored 31 demonstration projects. The cleanest projects, called "combined-cycle coal-gasification plants," turn coal into gas, which is burned to generate electricity.

So far, there have been no commercial orders for them. In recent years, utilities have almost exclusively built natural-gas-fired plants, which meet environmental standards and use a fuel that -- until last year -- was abundant and cheap. In fact, $467 million of the demonstration money remains unspent.

But with the utility industry's recent problems, interest in coal gasification is building, says Robert S. Kripowicz, who is in charge of the DOE clean-coal program. "People have begun to realize you can't hang your hats only on natural gas."

Hundreds of industry executives and politicians have recently trooped through a gasification plant built by Tampa Electric Co. in Polk County, Fla., with $140 million of help from the DOE. Situated amid a 1,511-acre "recreational preserve" that includes five fishing lakes and bird-nesting islands designed with help from the National Audubon Society, the plant is 10% more efficient than most coal-fired plants.

Noxious Chemicals

But it still is far from clean. Coal contains dozens of noxious chemicals, including lead, arsenic and other heavy metals; sulfur dioxide, which creates acid rain; nitrogen oxides, which create smog; tiny soot particles, which can invade and collect in human lungs; mercury, a toxic metal that accumulates in animals, fish and the humans who eat them; and carbon dioxide, which many scientists believe is artificially warming Earth's atmosphere by trapping more heat from the sun.

While the Tampa power plant collects more of these than traditional plants, plant officials say that it was not built to cope with mercury, which is facing federal regulation, or CO2. Both continue to go right up the stacks.

As it stands, clean coal remains a hard sell. "When we talk to utilities, they tell us they are reluctant to make a commitment, because they are concerned about regulations they might face in five, 10 or 15 years' time. It's very frustrating for us," says David H. Pai, president of a subsidiary of Foster Wheeler Corp., the Clinton, N.J., company that builds modern coal-fired power plants.

What Utilities Want

To stimulate a return to coal-fired plants, Mr. Pai suggests a combination of government incentives and a new kind of insurance package to protect a company against future pollution liability. "Otherwise, you're going to have the Tampa plant sitting there and nobody is going to step up and buy the next one," he says.

The government has money for incentives: Besides the $467 million in unspent demonstration money, the Bush budget would add another $2 billion in the next 10 years. In addition, the administration proposes to extend tax credits to support research and development projects and directs federal agencies to "explore new regulatory approaches" that will encourage advances in clean-coal technology.

For more than 30 years, most coal-fired plants have been exempt from the federal Clean Air Act's pollution controls. Under a compromise that gave birth to the law, most of the nation's coal plants were "grandfathered" on the assumption that older plants would soon wear out. But utilities found clever ways to keep many of them running, a fact that continues to rile environmental groups.

"Coal is so cheap because its dirtiness still doesn't count against it," says David Hawkins, an air-pollution expert for the Natural Resources Defense Council.

"All the data show that the low-hanging fruit for cleaning up the air is addressing the problem of pollution by utilities," says Kirsten Bryant of Alabama's Environmental Council. Her group is part of a coalition campaigning against Atlanta-based Southern Co., one of the nation's largest operators of coal-fired plants.

"Clean-burning coal is a complete oxymoron," declares Lori Ehrlich, a Marblehead, Mass., housewife who has taken on PG&E National Energy Group, a unit of San Francisco-based PG&E Corp. that bought two old coal-fired plants in Massachusetts. The fight began after one plant, in Salem, left part of Ms. Ehrlich's house coated in soot.

Ms. Ehrlich formed HealthLink, a community group, that successfully fought for tougher state regulations. The state's new rules require reductions in sulfur dioxide, nitrogen oxides, mercury and carbon dioxide by 2006. "This law is much tougher than we had expected," says PG&E spokeswoman Lisa Franklin. The company, she says, is still considering its options.

Those options, however, don't include coal gasification and other demonstration-plant options. They "don't make sense economically" as a fix for the older plants, she says. "We're looking at hundreds of millions of dollars here."

Possible Solutions for Now

A more likely solution, she thinks, will be adding both a "scrubber," a small chemical plant that removes sulfur dioxide, and a giant catalytic converter to trap several other pollutants. As for CO2, PG&E has an agreement to plant more forests in Malaysia, a move to offset global CO2 accumulation; PG&E gets credits from Massachusetts for that.

PG&E hasn't shunned clean-coal technology altogether. PG&E and Southern have joined the DOE in the nation's ultimate coal research program, the "Zero Emissions Coal Alliance." Currently a small research project at Los Alamos National Laboratory, its ambition is to trap all pollutants, achieving clean-burning coal.

The Zeca plant will combine coal gasification with a process that traps CO2 in magnesium silicates, a gray powder made from grinding commonly found rocks. Klaus Lackner, one of the Zeca scientists, says it will require mining six tons of rocks to trap the CO2 from one ton of coal. The rock dust would then be buried back in the rock mines.

He figures the process will take at least 20 years to develop and could double the price of electricity. Noting that coal is the nation's most plentiful fossil fuel and a cheap source of hydrogen -- which might be used to power cars -- Mr. Lackner thinks Zeca isn't so far-fetched. "It is not so expensive that the economy couldn't handle it, but it's expensive enough that you just don't do it willy-nilly. If you succeed, you are protecting a trillion-dollar industry."

Write to John J. Fialka at john.fialka@wsj.com
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