Washington, DC - An innovative clean coal technology project in Texas will supply electricity to the largest municipally owned utility in the United States under a recently signed Power Purchase Agreement, the U.S. Department of Energy (DOE) announced today.

Under the agreement - the first U.S. purchase by a utility of low-carbon power from a commercial-scale, coal-based power plant with carbon capture - CPS Energy of San Antonio will purchase approximately 200 megawatts (MW) of power from the Texas Clean Energy Project (TCEP), located just west of Midland-Odessa.

The 400-MW TCEP plant is a first-of-its-kind Integrated Gasification Combined Cycle (IGCC) poly-generation facility believed to be the cleanest coal-fueled power plant operating anywhere in the world. The facility is capable of capturing 90 percent of the carbon dioxide (CO2) it produces, as well as 99 percent of sulfur dioxide, 90 percent of nitrogen oxide, and 99 percent of mercury.

TCEP was a third round selection under DOE’s Clean Coal Power Initiative, a cost-shared collaboration between the Federal government and private industry aimed at stimulating investment in low-emission coal-based power generation technologies through successful commercial demonstrations. The $2.4 billion plant will receive $450 million in funding from the Clean Coal Power Initiative; of this, $211 million comes from the American Recovery and Reinvestment Act of 2009. The facility is expected to be fully operational in 2015.

Many experts view gasification technology as the future for coal-derived electricity. DOE’s Office of Fossil Energy has been instrumental in the research, development, and deployment of IGCC and other innovative energy technologies and is playing a pivotal role in advancing America’s energy future while helping to enhance environmental protection.

Gasification uses oxygen and steam at high pressures to convert coal into synthesis gas, also known as syngas, which is mainly a mixture of hydrogen and carbon monoxide. In a non-carbon-capture plant, the syngas is cleaned to remove impurities and sent to a gas turbine where it undergoes combustion to produce electricity. The hot flue gas from the gas turbine, containing CO2, is used to generate steam, which is fed to a steam turbine to produce additional electricity and then vented to the atmosphere. This process is known as integrated gasification combined cycle (IGCC) because coal-fired gasification is integrated into a combined-cycle system that produces electricity from both the gas turbine and the steam turbine.

In the TCEP carbon capture plant, the carbon monoxide in the syngas will first be "shifted" to produce additional hydrogen and CO2, cleaned of impurities, and then separated into pure streams of hydrogen and CO2. The hydrogen will be combusted in an advanced combustion turbine, producing a carbon-free flue gas. Of the nearly 2.9 million metric tons of CO2 that will be captured annually at the TCEP plant, approximately 83 percent will be used for enhanced oil recovery in the West Texas Permian Basin, a process that both prevents the greenhouse gas from entering the atmosphere and enables more oil to be produced from regional oilfields; the remainder will be to produce urea, a high value product. The production of a co-product in addition to electricity significantly improves the overall economics of the process.

Compared to traditional power plants, IGCC offers many advantages, including increased power plant efficiency and resulting lower-cost electricity. Unlike conventional power plants that remove environmental contaminants from the large-volume nitrogen-containing flue gas after combustion, IGCC power plants remove contaminants before combustion. Because gasification plants operate at high pressure with oxygen instead of air, the volume of gas that has to be treated is nearly two orders of magnitude lower, making the removal of environmental contaminants much easier. In addition, CO2 is much easier to capture and is produced at higher pressures than that from conventional power plants.

Today, approximately 80 percent of the energy consumed in the United States comes from coal, petroleum, and natural gas, with coal-fired power plants accounting for approximately half of the electricity generated. With increasing global energy demands, coal is expected to continue to play a dominant role in meeting future energy needs. The implementation of clean, state-of-the-art coal-based technologies will ensure America’s energy security while mitigating the environmental impacts of fossil fuel use.