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Xcel Spends $3.5M ON 'Clean Coal' Plant

DENVER (AP) - Xcel Energy said it is committing $3.5 million through 2007 to develop a so-called clean coal plant in Colorado based on Integrated Gasification Combined Cycle Technology.

"We believe the development and commercial operation of clean-coal technology is needed in Colorado and throughout our nation," said Richard C. Kelly, president, chairman, and chief executive of Minneapolis-based Xcel Energy. "We want to lead the effort to demonstrate that this technology works using western coal at high altitude."

The plant would also capture carbon dioxide and inject it underground, possibly in depleted oil fields.

Environmental groups praised the utility for moving forward on what they said would be a first-of-its-kind project that could have nationwide implications.

"I think what Xcel is doing here is taking a leadership role," said John Neilsen, energy program director at Western Resource Advocates, a Boulder-based environmental law and policy group.

Two coal-gasification plants are operating in Indiana and Florida, but they don't capture the carbon dioxide, Neilsen said.

"That's why I think this is really a landmark project and will have implications across the country," he said.

Xcel Energy said it plans to file an application with the Colorado Public Utilities Commission for approval of the project late next year. The 300-350 megawatt facility would serve the electricity needs of up to 350,000 homes in Colorado and cost at least $500 million to build, beginning in 2009.

In a conventional power plant, coal is pulverized and burned in a boiler to produce electricity. Emissions are caught and filtered at the back end of the process.

IGCC technology converts coal to a gas that is burned in a turbine to produce electricity. Pollutants are removed before the fuel is burned.

Xcel Energy spokesman Tom Henley said the company estimates that turning coal into gas could reduce emissions by 25 percent to 90 percent. He said the process also uses less water and produces less waste. Henley said the plant initially won't isolate all the carbon dioxide, and he wasn't sure how much would be injected underground.

Vickie Patton, an attorney with the regional office of Environmental Defense, said such leadership by Xcel is crucial in addressing the risks of global warming. Carbon dioxide - a byproduct of fossil fuel combustion - and other heat-trapping gases are blamed for heating the planet.

Neilsen also said advancing clean-coal technology is vital because 25 new coal-fired power plants are proposed across the West.

Henley said Xcel Energy believes the plant will cost $500 million, some of which the utility hopes comes from federal funding earmarked for clean-coal technology and from partners.

IGCC technology is yet to be used with Western coal at a higher altitude. Western coal contains more moisture and lower heat value, so it takes more coal to produce the same amount of heat as coal mined in the eastern U.S.

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