The U.S. Department of Energy on Sept. 13 awarded $55.4 million in federal funding for cost-shared research and development to nine projects that will receive grants for front-end engineering design, or FEED, studies of carbon-capture systems across the country.
The 847-MW, coal-fired San Juan Generating Station in Farmington, New Mexico, and the 550-MW Elk Hills power plant in Kern County, California, are among the plants involved in projects that will receive DOE funds to conduct the studies.
Enchant Energy of New York will receive $2.9 million, 80 percent of the $3.6-million total cost for the FEED and other associated studies that will enable the company to determine the technical and economic viability of extending the life of New Mexico's SJGS with carbon capture, utilization and storage technology (see CEM No. 1553). Enchant will fund the remaining 20 percent of the project costs, estimated at $700,000. The City of Farmington will contribute the services of city employees valued at approximately $10,000, according to a press release issued by Enchant and the city.
"It's a fantastic endorsement of the project's venue," Enchant CEO Jason Selch said in a phone interview, noting the plant's proximity to the Kinder Morgan Cortez CO2 Pipeline. The pipeline runs about 20 miles west of the plant and transports mined carbon dioxide gas from the McElmo Dome in southwestern Colorado to the oil fields of the Permian Basin for use in enhanced oil recovery.
Enchant's completed project, estimated at $1.3 billion, according to Selch, includes a connector pipeline that will enable the company to sell and transport, via the Kinder Morgan pipeline, anthropogenic carbon from the plant to the Permian Basin for EOR. The sale of compressed CO2 gas will offset the operational costs of the plant and its CCS system, expected to carry a parasitic load of 209 MW for capture and compression of the carbon, according to a presentation Selch made to the U.S. Energy Association in June.
Selch also hopes to market and sell the wholesale, low-emissions power generated at San Juan across the West. Part of the FEED study will entail evaluating and identifying a market for the power, Selch said.
Sargent & Lundy of Chicago, the engineering firm that performed the project's pre-feasibility study, will join the Wanger Institute for Sustainable Energy Research at the University of Illinois; Acme Equities, an investment company founded by Selch in 2012; Navigant Consulting of Chicago; Washington, D.C.-based EJM Associates; and Tenaska Power Services of Omaha in executing this phase of the project, according to the release.
Selch said the study will begin Nov. 1 after Enchant has selected its preferred CCS technology from among three types under consideration. He expects the study to take about nine months and plans to begin construction on the San Juan carbon capture, storage and utilization system retrofit in the first quarter of 2021.
The plant is scheduled to close in June of 2022, but Selch plans for a smooth transition that will enable the plant to begin operations as a CCUS facility without completely shutting down. If successful, the retrofit could reduce CO2 emissions as much as 90 percent compared with the plant's current operations, capturing up to 6 million metric tons of carbon per year, according to Selch.
The Energy Department also awarded a FEED study grant to the Electric Power Research Institute of Palo Alto, California, to retrofit the 550-MW natural gas combined-cycle Elk Hills power plant in Kern County with post-combustion carbon-capture technology. The plant, along with a 45-MW cogeneration facility, supplies power to Elk Hills Field, a local utility and the California grid, according to California Resources Corp., an oil and natural gas exploration and production company that owns both the plant and the field.
The project could capture 75 percent of the plant's CO2, about 4,000 metric tons per day according to the DOE announcement, for use in enhanced oil recovery at the field. If the technology used in this project—Fluor's amine-based Econamine FG Plus process—is successfully implemented, many existing U.S.-based plants might be candidates for a similar retrofit, the DOE announcement said.
The other DOE FEED study grants for carbon-capture systems include both natural gas combined-cycle and coal-fired plants. Several new CCS technologies, including membranes and advanced solvents, will be tested for their CCS potential. The agency chose projects with prospects for advancing CCS implementation, bringing down costs, and retrofitting existing fossil-fuel plants.
The agency's Office of Fossil Energy also on Sept. 13 announced an additional $35 million in funding for cost-shared R&D CCUS projects that will bring the agency's total for carbon-capture funding to approximately $110 million for 2019. In addition to the FEED study funds, the agency awarded $20 million to four projects in its Regional Initiative to Accelerate CCUS Deployment earlier this year.
The new funding opportunity, Carbon Storage Assurance Facility Enterprise (CarbonSAFE), is intended to "accelerate wide-scale deployment of CCUS through assessing and verifying safe and cost-effective anthropogenic CO2 commercial-scale storage sites, and carbon capture and/or purification technologies," according to a DOE press release. The projects have the potential to take advantage of the 45Q tax credit of $35 for each metric ton of CO2 utilized for EOR and $50 per metric ton for geologic storage. Selch has said Enchant plans to finance the majority of the San Juan project through the 45Q tax credits.
"These [funding opportunities] further the administration's commitment to strengthening coal while protecting the environment," DOE said.