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Transcript
FutureGen Project Update Presentation to Washington Coal Club Mike Mudd, CEO April 11, 2007 Outline • Energy Trends • Energy Technology – Role in a Climate Change Strategy – Coal-fueled Power and Sequestration • FutureGen – – – – – Concept Partners Federal Role Technology Progress • Summary Energy and economic growth are inextricably intertwined More People Living Longer and Better Lives 275 GDP +149% Indexed to 1974 (100) 250 225 200 Electricity Use +111% 175 150 Per Capita Income +80% 125 Coal Use +77% 100 75 50 1974 72 1980 73.9 1985 1990 1995 2000 2004 74.7 Life Expectancy 75.1 75.7 76.7 77.6 Source: Energy Information Administration Annual Energy Review 2005; U.S. Department of Commerce, Bureau of Economic Analysis. Billion kWhs Coal has been – and will continue to be a critical part of USA’s energy supply Energy Information Administration, Annual Energy Outlook 2007 Global energy system projected to grow at an extraordinary pace • A growing global energy system • Fossil fuels account for 85% of the increase • Developing world accounts for two thirds of the increase in global coal use – Ever-increasing CO2 concentrations in the atmosphere History and Reference Case 1600 History . Global Primary Energy 1850-2100 (Exajoules) – Sustained economic growth – By 2025, world primary energy consumption increases 60% World primary energy consumption Business As Usual Case Future 1400 Renew Nuc Biomass 1200 1000 Coal 800 600 Gas 400 200 0 1850 Oil 1900 1950 2000 2050 2100 Serious climate strategies require major advances in technology • Overwhelming evidence that: – The scale of the global energy system is immense and growing – Energy conversation is an incredibly important tool, which society must use, but it is well-proven that it is physically impossible to “conserve” our way to a complete solution – Fossil fuels are affordable, abundant, and, on a global basis, will be used – Advanced technology can substantially reduce the cost of managing CO2 emissions – None of the commonly discussed technologies--renewables, biomass, nuclear, fossil with sequestration, or others can address the challenge alone. All options are required at a megascale – RD&D are required to reduce the cost and improve the performance of new technologies – The next ten years is a critical window in which to prove advanced technologies Coal-fueled power coupled with sequestration offers great promise • Carbon capture and sequestration recognized as a key part of the solution – 2005 IPCC technical report concluded it is highly probably that, on a global basis, there are adequate geologic formations to store centuries worth of CO2 – Leading environmental groups have been strongly supportive of the technology – National Energy Policy Commission recommended large-scale demonstrations • However, it must be proven: – at a commercial-scale – in multiple places around the globe – immediately FutureGen Right Technology at the Right Time • World’s first, near-zero emission coalfueled power plant • More than one million tons of CO2 captured and sequestered annually in a deep saline geologic formation • “Living laboratory” to test and validate cutting-edge power, sequestration, and monitoring technologies • Global public-private partnership • Stakeholder involvement FutureGen Right Partners • Industry – Twelve leading companies with operations on six continents – Investing $250M* in project with no expectation of financial return • Governments – United States, China, India, South Korea, and Japan • Uniquely positioned to build global acceptance of near-zero emission coal technology *1Q 2004$ FutureGen Importance of the Government Role • Public benefit project – Could help fundamentally transform the global energy system and address the public’s climate change concerns – Will lay the technical foundation for monitoring CO2 sequestration, its long term effects, and permanency – Industry’s participation is on a non-profit basis • Research on a first-of-a-kind technology – No IGCC plants currently with carbon capture and sequestration in the world. – Widely recognized that governments have an important cost-sharing role in pre-competitive research • Global applicability of the technology is critical – Governments are uniquely positioned to build international partnerships that will strengthen acceptance of near-zero emission coal technology FutureGen Technology Advances IGCC Technology • Designed to gasify eastern and western U.S. coals, and test other coals, which expands the global applicability of environmentally-friendly IGCC technology • Advances gasification, hydrogen turbine, and other clean-coal technologies • Integrates CO2 capture at a commerciallyrelevant scale into a IGCC power plant • Addresses power plant operation with CO2 capture, transport, and sequestration integration FutureGen Technology Advances Sequestration Technology • Focused on deep geologic formations which are globally available • Extensive modeling and monitoring program planned to verify the safety and permanence of CO2 storage 11,000 Gigatons of potentially available CO2 storage capacity FutureGen Progress Fast Tracked Schedule • DOE and the Alliance have met every major milestone over the past 14 months. • Project is on-schedule for a 2012 on-line date 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 FutureGen Summary Schedule Siting, NEPA, & Permitting Project Development & Initial Conceptual Design Design Phase 2 DOE/Alliance Limited Scope Cooperative Agreement Design Phase 3 Facilities Construction DOE/Alliance Cooperative Agreement Plant Start-up & Testing NEPA ROD, July 2007 Initial Full-Scale Plant Operations Final Site Selected September 2007 BP0-14 months BP1-16 months BP2-10 months Continuing Plant Operations Site Monitoring After Initial Operations BP3-44 months BP4-36 months BP5-24 months FutureGen Site Selection 12 Sites in 7 States Proposed 4 Sites in 2 States on Candidate List Candidate Sites FutureGen Progress Site Selection • First-of-a-kind siting methodology developed • Can be extended to future commercial near-zero emission power plant projects around the world • Final site to be selected by September Mattoon, IL Tuscola, IL Brazos, TX Odessa, TX FutureGen Progress Conceptual Design • Multiple alternative power plant design options evaluated • Facility concept that is fuel-flexible developed • Conceptual engineering designs and costs estimates on three power plant configurations prepared • Engineering Construction Manager on board • Open competition to purchase major equipment currently being developed FutureGen Progress Environmental Impact Statement • Three volume, 2200-page analysis of the potential environmental impacts – Summary – Volume I – Introduction, Alternatives, Summary of Conclusions – Volume II – Affected environment and environmental consequences at each site FutureGen Draft Environmental Impact Statement • Draft EIS concludes no significant adverse impacts • Public hearings and comment during April May March 2007 FutureGen Progress Independent Cost Estimate • Selected Power Plant Material Escalation vs. General Inflation Fabricated, Structural, & Misc Steel 60 50 Steel Pipe, Tube and Fittings 40 Copper and Brass Mill Shapes 30 20 GDP 10 0 -10 -20 2000 2001 2002 2003 2004 • • • 70 % Change Between 2000 and 2005 • Inflation reflects the normal up-anddown fluctuations in materials, labor, and services over time. Controlled by market forces (supply/demand), not the Alliance or DOE Power plant inflation has been greater than general inflation. 2005 Alloys, Steel, Concrete, He Wall, Refinery Work, etc. • Engineers, Suppliers, Fab Shop Space, Specialty Tra • China, International Suppl Definition #2: Scope Growth Definition #1: Inflation • • Would include project mission expansion, and additional project complexity, or additional equipment. Discretionary decision; could be justified if something of value is added to the project and only if funding is available by both the Alliance and the DOE. Alliance/DOE have control over scope growth. FutureGen Progress Independent Cost Estimate Construction Cost Indices (Source: Chemical Engineering Magazine, November 2006) 540 1,400 Chemical Engineering Plant Cost Index 520 1,350 Marshall & Swift Equipment Cost Index 500 1,300 480 1,250 460 1,200 440 1,150 420 1,100 400 1,050 380 1,000 360 Jun-98 Jun-99 Jun-00 Jun-01 Jun-02 Jun-03 Jun-04 Jun-05 Jun-06 • • • Plant Construction Costs Escalating 950 Jun-07 Marshall & Swift Equipment Cost Index • Inflation reflects the normal up-anddown fluctuations in materials, labor, and services over time. Controlled by market forces (supply/demand), not the Alliance or DOE Power plant inflation has been greater than general inflation. Chemical Engineering Plant Cost Index • Alloys, Steel, Concrete, He Wall, Refinery Work, etc. • Engineers, Suppliers, Fab Shop Space, Specialty Tra • China, International Suppl Definition #2: Scope Growth Definition #1: Inflation • • Would include project mission expansion, and additional project complexity, or additional equipment. Discretionary decision; could be justified if something of value is added to the project and only if funding is available by both the Alliance and the DOE. Alliance/DOE have control over scope growth. FutureGen Progress Project Cost DOE 2004 Estimate Project Cost (1Q 2004$) Scope Growth (1Q 2004$) Inflation Multiplier $950M $954M -- Zero -- 1.56 Project Cost $1,484M (future-year dollars thru 2017) DOE/FG Cost Share % DOE/FG Cost Share $M Alliance 2006 Estimate 74/26 $900/$250 74/26 $1,100/$384 FutureGen Summary • Supports a technology-based climate change strategy – Mitigates the financial risks of carbon dioxide emissions • Validates the cost and performance of an integrated near-zero emission coal-fueled power plant – Advances IGCC technology – Advances carbon capture, sequestration, and hydrogen-production technologies – Sets groundwork for CO2 sequestration siting and licensing • Creates the technical basis to retain coal in U.S. and global energy mix with a long-term goal of zero emissions. • Enables the public and private sector to share the cost and risk of advanced technology demonstration. – Platform for emerging technology demonstration. Contact Information: Michael J. Mudd Chief Executive Officer FutureGen Alliance [email protected] (614) 716-1585 www.FutureGenAlliance.org