Why everyone will soon love "clean coal"

clean_coal.gi.top.jpg By Jonathan Barnes, contributor

(Fortune) -- The one green technology that politicians of all parties seem able to rally around is "clean coal." Coal generates about half of America's electricity -- a quickly rising figure -- and a third of its carbon dioxide emissions. The chance of replacing it with solar or wind in anyone's lifetime is tiny -- and besides, solar and wind companies aren't exactly the same caliber of donor as the coal industry when it comes to Capitol Hill.

So it's not surprising that a technology promising to remove the carbon dioxide from coal-burning emissions and store it deep underground has gained powerful backers, including President Obama and Secretary of Energy Steven Chu. There's only problem with it: So far it's just a theory that is being tested.

Last week the Global Carbon Capture and Storage Institute -- a group that advocates speeding the worldwide commercial deployment of CCS technology to reverse global warming -- met in Pittsburgh for its first U.S. meeting. While there was much discussion of the best ways to capture the carbon dioxide generated by coal, another topic loomed just as large: how to capture consumer excitement.

It's consumers' money, after all, that is being used to fund the research. Corporations that are supporting the technology, such as Shell (RDS.A), the Vinod Khosla-backed Calera, and others like AEP (AEP, Fortune 500), Chevron (CVX, Fortune 500), and Alstom, aren't committing big funds yet to the efforts. So taxpayers have had to pay a significant share of the several CCS demonstration projects that are in operation, including the Mountaineer Project in West Virginia. In October the Department of Energy announced that it would use $1.4 billion in stimulus funds on 12 carbon dioxide projects. And the recently introduced America Power Act introduced by Senators John Kerry and Joe Lieberman calls for $2 billion a year in incentives for learning more about CCS.

"You have to explain CCS and why it's needed," said Claude Mandil, a member of GCCSI's international advisory panel and a former executive director of the International Energy Agency. "It's a technology that's in its infancy; it's very difficult for people to understand. People can understand what a hybrid car is, but nobody knows exactly what CCS looks like except a few experts."

That soon will change. The various members of the GCCSI are all making plans to spread the word, even before some of them are sure it works. (In an aside during the meeting of CCS boosters, one energy industry official admitted that the long-term effects of CCS technology on the environment, such as whether the CO2 will stay put in the ground where it is placed, are uncertain.)

Barry Worthington, executive director of the U.S. Energy Association, based in Washington, D.C, said his group would be working hard to increase the number of demonstration projects and to convince those who live around each project of the value of it. One way: USEA is developing a classroom curriculum on the CCS technique.

While the kids are learning about CCS, states are being sold on the idea that CCS wouldn't just clean the envirponment, it would bring jobs. A group called the American Coalition for Clean Coal Electricity -- whose members include GE (GE, Fortune 500), CSX (CSX, Fortune 500), Peabody Energy (BTU, Fortune 500) and other industrial and energy heavyweights -- just released a study that claims adding CCS to the energy workflow will bring 150,000 new jobs.

All this boosterism comes as coal is trying to escape its image as a rock that brings not just energy but catastrophe: In April, 29 coal miners in West Virginia died when a mine owned by Massey Energy (MEE) exploded. A month later 21 miners died in an explosion in China, followed shortly after by a Russian mine disaster.

And in China, where CCS was once considered one of the ways the country was going to clean its skies, the process of removing the carbon dioxide from coal-burning emissions is proving so energy-intensive that the Chinese are now having second thoughts. In February, Reuters reported that head of the climate department at the National Development and Reform Commission had called CCS installation and running-cost expenses a "fatal weakness." According to the article, the Chinese found that any power plant using CCS would spend 20% to 30% of their output just making it work.

But even those figures are in doubt. "We don't know the exact cost or exact hurdles. We need to start with experiments," Mandil said. To top of page