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AEP to receive federal stimulus funding for CCS project

AEP selected to receive DOE funds to advance carbon dioxide capture and storage to commercial scale

American Electric Power was notified by the U.S. Department of Energy (DOE) that it was selected to receive funding through the Clean Coal Power Initiative Round 3 to pay part of the costs of installing the nation’s first commercial-scale carbon dioxide capture and storage system on its Mountaineer coal-fired power plant in New Haven, W.Va. The DOE announced the funding today.

AEP will immediately begin negotiating terms with the DOE to receive $334 million to assist with the installation of the system that will use a chilled ammonia process to capture at least 90 percent of the carbon dioxide from 235 megawatts of the plant’s 1,300 megawatts of capacity. The captured carbon dioxide, approximately 1.5 million metric tons per year, will be treated and compressed, then injected into suitable geologic formations for permanent storage approximately 1.5 miles below the surface. The system will begin commercial operation in 2015, according to the company’s application for funding.

The $334 million requested by AEP is about half of the estimated cost of the system.

“We’re pleased that the DOE selected our project for funding,” said Mike Morris, AEP chairman, president and chief executive officer. “It demonstrates the agency’s recognition that commercialization of carbon capture and storage technology is an essential component in a successful climate strategy for this nation, which relies on coal-fired generation for about half of its electricity supply.

“Customers of utilities in the U.S. and abroad will benefit from the work we are doing at our Mountaineer Plant,” Morris said. “The first use of any technology comes at a higher cost than subsequent uses. The DOE funding will reduce the costs our customers face for the first commercial deployment of this technology, which will lead to lower future costs for customers of AEP and other utilities as companies retrofit existing coal-fired plants to address carbon dioxide emissions.

“We greatly appreciate the support we’ve received from West Virginia’s Washington delegation and state officials as we pursued funding to push this important technology to commercial scale,” Morris said.

For this commercial-scale project, AEP has formed a diverse technical advisory committee that includes recognized experts in the field of geologic carbon dioxide storage. This group will include participants from Schlumberger Limited, Battelle Memorial Institute, Lawrence Livermore National Laboratory, Massachusetts Institute of Technology, The Ohio State University, West Virginia University, The University of Texas, West Virginia Geological Survey, Ohio Geological Survey, CONSOL Energy, and the West Virginia Department of Commerce Division of Energy. Additionally, Battelle and Schlumberger will work directly with AEP to design and deploy the carbon dioxide storage system at Mountaineer. AEP is also in discussions with other potential international partners for the project.

AEP and Alstom began operating a smaller-scale validation of the technology in September at the Mountaineer Plant. That system captures up to 90 percent of the carbon dioxide from a slipstream of flue gas equivalent to 20 megawatts of generating capacity. The captured carbon dioxide, more than 100,000 tons a year, is being compressed and injected into suitable geologic formations for permanent storage approximately 1.5 miles below the surface. No federal funds are being used for the validation project.