A Mississippi power plant announced Wednesday it would not use the federally-funded technology the Obama administration used to justify implementing a “Climate Action Plan” making it hard to build new coal-fired power plants.
Southern Company and Mississippi Power announced the Kemper power plant would be not using its carbon capture and storage (CCS) system to generate electricity. The plant will continue to only use natural gas, but not the federally-funded technology the Obama administration argued would be the future of coal power.
“We are committed to ensuring the ongoing focus and safety of employees while we consider the future of the project, including any possible actions that may be taken by the Commission,” Southern Company CEO Thomas Fanning said in a statement.
The Environmental Protection Agency (EPA) cited the Kemper power plant and its CCS system as justification for a 2015 rule that effectively banned the construction of new coal-fired power plants unless they used CCS.
EPA also cited two CCS plants planned in Texas and California. The agency pointed to a Canadian government-backed project, which eventually became the world’s first commercial-scale CCS plant.
Critics said EPA’s citing of Kemper to impose a de facto ban on coal plants was not only illegal, but technically and economically problematic. Kemper was one of several projects EPA cited that had gotten federal grants, loans and tax credits.
The plant was also plagued by cost overruns and delays. The $7.5 billion CCS plant came in $4 billion over budget and was supposed to begin operating in 2016.
EPA rebuffed critics in its 2015 regulation. The agency said:
The carbon capture process being utilized for the Kemper County IGCC is a commercial technology referred to as Selexol. The Selexol process is a commercial technology that uses proprietary solvents, but is based on a technology and principles that have been in commercial use in the chemical industry for over 40 years. Thus, the risk associated with the design and operation of the carbon capture equipment incorporated into the Plant’s design is manageable.
The EPA is currently reviewing the Clean Power Plan, which limits carbon dioxide from new and existing power plants, and the agency is expected to reverse those regulations and replace them with less-stringent standards.
Kemper been generating electricity from natural gas, but only captured a small amount of carbon dioxide from the coal it burned.
Now, operators don’t plan on using its CCS system after state regulators pressured operators to stop using “unproven technology” that could increase electricity prices.
“We believe this decision is in the best interests of our employees, customers, investors and all other stakeholders,” Fanning said.
The news may be problematic for the Trump administration. Energy Secretary Rick Perry threw his support behind CCS coal plants, specifically pointing to a much more successful one in his home state.
President Donald Trump has also repeatedly said he supports “clean coal,” but it’s unclear if he is referring to CCS or just more efficient coal plants. Trump also proposed to cut funding to the Energy Department office that manages CCS projects.
Kemper got federal funding from the Energy Department under the Bush and Obama administrations. In fact, all CCS power plant projects in the U.S. were backed by the federal government.
The Petra Nova CCS coal plant started operations earlier this year. The Texas plant will capture 90 percent of the CO2 it creates and pipe it to a nearby oil field for enhanced oil recovery. The plant got $167 million from the Energy Department.
Another CCS project in Texas, however, is still under development, and Energy Department auditors warned in 2016 that taxpayers could lose $450 million if it continues to miss deadlines.
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