1 FutureGen FutureGen Zero Emissions Energy Plant of the Future 2004 Indiana Energy Conference “Perspectives on the Energy Puzzle” September 16, 2004 University Place Conference Center at IUPUI Indianapolis, Indiana Victor K. Der Director Office of Clean Energy Systems, Office of Fossil Energy U.S. Department of Energy 2004 Indiana Energy Conference “Perspectives on the Energy Puzzle” September 16, 2004 University Place Conference Center at IUPUI Indianapolis, Indiana Victor K. Der Director Office of Clean Energy Systems, Office of Fossil Energy U.S. Department of Energy

2 FutureGenFutureGen +A Government/Industry cost shared partnership +Pioneer advanced hydrogen production from coal +Emit virtually no air pollutants +Capture and permanently sequester carbon dioxide +A Government/Industry cost shared partnership +Pioneer advanced hydrogen production from coal +Emit virtually no air pollutants +Capture and permanently sequester carbon dioxide FutureGen What is the FutureGen prototype? A global effort to build the world’s first zero emission power plant: A global effort to build the world’s first zero emission power plant: +Other nations invited to join in this research project (~1 billion dollars over the next ten years) utureGen  FutureGen will be an international test facility for breakthrough technologies that addresses feasibility of zero emissions +Other nations invited to join in this research project (~1 billion dollars over the next ten years) utureGen  FutureGen will be an international test facility for breakthrough technologies that addresses feasibility of zero emissions

3 U.S. Department of Energy Tomorrow’s Hydrogen Why is Hydrogen from Coal Important? +95% of U.S. hydrogen comes from natural gas +Future “Hydrogen Economy” must have more diversified sources +Over longer term, hydrogen will likely come from renewables, nuclear power, fusion, etc. +95% of U.S. hydrogen comes from natural gas +Future “Hydrogen Economy” must have more diversified sources +Over longer term, hydrogen will likely come from renewables, nuclear power, fusion, etc. But coal can also be a major feedstock +Most abundant U.S. fossil fuel (250-yr supply); if transportation fuel today was hydrogen, potential for additional 1.3 billion tons coal per year; by 2025 that addition could grow to 2.4 billion tons +Hydrogen from coal for transportation enhances energy/economic security +Can be environmentally clean source of hydrogen +Most abundant U.S. fossil fuel (250-yr supply); if transportation fuel today was hydrogen, potential for additional 1.3 billion tons coal per year; by 2025 that addition could grow to 2.4 billion tons +Hydrogen from coal for transportation enhances energy/economic security +Can be environmentally clean source of hydrogen

4 U.S. Department of Energy Climate Change Carbon Management Paths  Switch to low- & no-carbon fuels  Increase energy efficiency  Sequester carbon Renewables, Nuclear, Natural Gas Demand-Side & Supply Side Why is Sequestration Important? +Since the world relies on fossil fuels (~ 88%), sequestration is an important option +May be only option that removes enough carbon to stabilize CO 2 concentrations in atmosphere +May prove to be lowest cost carbon management option +Since the world relies on fossil fuels (~ 88%), sequestration is an important option +May be only option that removes enough carbon to stabilize CO 2 concentrations in atmosphere +May prove to be lowest cost carbon management option FutureGen The FutureGen plant will be a first-of-its-kind project by the U.S. electric power industry to prove that large-scale sequestration is safe and practicable, and one that encompasses all three carbon management paths.

5 U.S. Department of Energy Project Performance Objectives +Design, construct and operate a full – scale prototype plant (integrated with CO 2 sequestration) that produces electricity and hydrogen with essentially zero emissions +Sequester at least 90 percent of CO 2 initially and 100 percent sequestered eventually +Prove the effectiveness, safety, and permanence of CO 2 sequestration +Establish technology standards and protocols for CO 2 measuring, monitoring, and verification +Validate the engineering, economic, and environmental viability of advanced coal-based, zero emission technologies for commercial readiness in Design, construct and operate a full – scale prototype plant (integrated with CO 2 sequestration) that produces electricity and hydrogen with essentially zero emissions +Sequester at least 90 percent of CO 2 initially and 100 percent sequestered eventually +Prove the effectiveness, safety, and permanence of CO 2 sequestration +Establish technology standards and protocols for CO 2 measuring, monitoring, and verification +Validate the engineering, economic, and environmental viability of advanced coal-based, zero emission technologies for commercial readiness in 2020

6 U.S. Department of Energy Features of the Project  Coal-fueled gasification process that produces electricity and hydrogen--275 MW e [net equivalent output]  Operational rate of 1 million tons per year of CO 2 captured and sequestered  Incorporates advanced technologies that will be competitive in future zero emission energy plants  Full-scale integrated operations  Coal-fueled gasification process that produces electricity and hydrogen--275 MW e [net equivalent output]  Operational rate of 1 million tons per year of CO 2 captured and sequestered  Incorporates advanced technologies that will be competitive in future zero emission energy plants  Full-scale integrated operations

7 U.S. Department of Energy Project Concept Refinery CO 2 Oil Hydrogen Enhanced Oil Recovery Geological Sequestration Electricity And/Or FutureGen

8 U.S. Department of Energy FutureGen FutureGen Conversion Process Oxygen (from air) Coal +H 2 O Hydrogen + Carbon Gases (CO 2, CO) Converting Coal into Gas is Key +Up to 99%+ of Clear Skies pollutants (sulfur/nitrogen/mercury) can be cleaned from gasified coal +Hydrogen is a primary product +Carbon gases are in concentrated form for easier capture and sequestration +Up to 99%+ of Clear Skies pollutants (sulfur/nitrogen/mercury) can be cleaned from gasified coal +Hydrogen is a primary product +Carbon gases are in concentrated form for easier capture and sequestration FutureGen No coal-to-gas plant in the world today is configured to optimize hydrogen production or to capture carbon. The FutureGen prototype plant would be the world’s first.

9 U.S. Department of Energy Technology Challenge Traditional Advanced Technology Cryogenic Separation Amine Scrubbers Gas Stream Clean-Up Syngas Turbine Fuel Cell ($4,000/kW) EOR based Existing Gasifier System Integration Plant Controls Traditional Advanced Technology Cryogenic Separation Amine Scrubbers Gas Stream Clean-Up Syngas Turbine Fuel Cell ($4,000/kW) EOR based Existing Gasifier System Integration Plant Controls Emerging Research Inventions O 2 Membranes Hydrogen Membranes “Clathrate” CO 2 Separation “Dirty” Shift Reactor Hydrogen Turbine SECA Fuel Cell ($400/kW design) Sequestration Technology Advanced Transport Reactor “First of a Kind” System Integration “Smart” Dynamic Plant Controls & CO 2 Management Systems (including in-situ CO 2 monitoring)

10 U.S. Department of Energy FutureGen FutureGen Systems Oxygen Products/ Byproducts Utilization H 2 /CO 2 Separation Fuels/Chemicals Fuel Cell High Efficiency Turbine Electricity Liquids Conversion Process Heat/Steam Gasification Gas Stream Cleanup Coal Gas Cleaning Oxygen Membrane Gasifier H2H2 CO 2 Enhanced Oil Recovery Coal Seams Saline Reservoir CO 2 Sequestration Power Fuels and Chemicals Fuel + H 2 O

11 U.S. Department of Energy FutureGen FutureGen Research Initiative - Status +February 27, Presidential announcement Received strong support from states, industry, international community and some environmentalists +April 2003 – Initial project plan developed +October Completed DOE affirmation of Mission Need for FutureGen (zero-emission coal option) +FutureGen Program Plan submitted to Congress +Fiscal Year 2004 funding of $9 million appropriated +DOE ready to enter into negotiations with industry +February 27, Presidential announcement Received strong support from states, industry, international community and some environmentalists +April 2003 – Initial project plan developed +October Completed DOE affirmation of Mission Need for FutureGen (zero-emission coal option) +FutureGen Program Plan submitted to Congress +Fiscal Year 2004 funding of $9 million appropriated +DOE ready to enter into negotiations with industry

12 U.S. Department of Energy Project Schedules --- Key Phases Major Project Milestones Fiscal Year 2015 Supporting Research* Design / Construction Shakedown / Operation Project Definition &Site Characterization Follow-on Testing * Supporting research includes research embedded in the FutureGen project and additional research in FE’s carbon sequestration, IGCC, turbines, and fuel cell R&D programs.

13 U.S. Department of Energy Project Schedule

14 U.S. Department of Energy Potential For State and Local Participation  Compete for the FutureGen host site  Offer incentives to Industrial Participants (e.g., streamline siting and permitting process, offer subsidies if project is sited in the state, offer land for the site)  Cost-share in the project with the Federal Government  Conduct outreach and education; provide geologic data and services via State geological offices  Continue participation in Sequestration Regional Partnership program to assess and characterize future potential sites  Compete for the FutureGen host site  Offer incentives to Industrial Participants (e.g., streamline siting and permitting process, offer subsidies if project is sited in the state, offer land for the site)  Cost-share in the project with the Federal Government  Conduct outreach and education; provide geologic data and services via State geological offices  Continue participation in Sequestration Regional Partnership program to assess and characterize future potential sites

15 U.S. Department of Energy Potential For International Participation  Participation on a cost-shared basis can be either on the industry side or on the government side.  Interest in participation from Carbon Sequestration Leadership Forum members encouraged  Mechanisms for participation can be through existing, modified, or new international agreements or protocols  Benefits and information negotiable depending on extent of cost- shared participation.  FutureGen International Participation Prospectus  Benefits to worldwide use of coal is enormous if zero emissions coal option is proven and accepted.  Participation on a cost-shared basis can be either on the industry side or on the government side.  Interest in participation from Carbon Sequestration Leadership Forum members encouraged  Mechanisms for participation can be through existing, modified, or new international agreements or protocols  Benefits and information negotiable depending on extent of cost- shared participation.  FutureGen International Participation Prospectus  Benefits to worldwide use of coal is enormous if zero emissions coal option is proven and accepted.

16 U.S. Department of Energy FutureGen FutureGen Near-Term Next Steps  Begin Environmental (NEPA) process for project  Begin development of competitive site selection criteria and process  Complete selection process for industry Consortium  Once cooperative agreement in place with Consortium:  Develop test scope for validating FutureGen  Assess cutting-edge technology readiness  Site characterization, evaluation and selection  Start preliminary design work  Conduct permitting activities  Begin Environmental (NEPA) process for project  Begin development of competitive site selection criteria and process  Complete selection process for industry Consortium  Once cooperative agreement in place with Consortium:  Develop test scope for validating FutureGen  Assess cutting-edge technology readiness  Site characterization, evaluation and selection  Start preliminary design work  Conduct permitting activities

17 U.S. Department of Energy Summary Remarks +FutureGen is a key research step towards proving the feasibility of a zero-emission coal option. +The goals are very challenging and it will collectively require our best minds and resources to meet these goals. +The cooperation and support of all stakeholders (federal state, and local governments, industry; environmental; NGO’s; and international) will be needed for FutureGen to be successful and accepted. +The potential benefits of a zero-emission coal option are enormous with respect to energy, environmental and economic security. +FutureGen is a key research step towards proving the feasibility of a zero-emission coal option. +The goals are very challenging and it will collectively require our best minds and resources to meet these goals. +The cooperation and support of all stakeholders (federal state, and local governments, industry; environmental; NGO’s; and international) will be needed for FutureGen to be successful and accepted. +The potential benefits of a zero-emission coal option are enormous with respect to energy, environmental and economic security.

18 U.S. Department of Energy Web Sites For Additional Information GENERAL SPECIFIC