Update on the FutureGen ProjectPathway Towards Zero Emissions

Michael J. MuddChief Executive Officer, FutureGen Industrial

Alliance

Gasification Technology Annual ConferenceOctober, 2006

• Commercial-scale 275-MWe Plant • Minimum 1-million (up to 2.5-million)

tons/year CO2 captured and sequestered

• Co-production of H2 and electricity• “Living laboratory” to test and validate

cutting-edge technologies• Public-private partnership• Stakeholder involvement• International participation• On-line 2012

FutureGenProject Features

FutureGen Alliance, Inc.

• Non-profit, 501(c)3 formed to manage the project

• Secured funding

• DOE Cooperative Agreement Signed Dec. 2, 2005

• 10 Members and still growing

Source : UK Department of Trade & Industry, A Strategy For Developing Carbon Abatement Technologies for Fossil Fuel Use

FutureGen

CO2 capture& storage

Ultra super criticalIGCC “capture ready”

Zero emissions

Increased efficiency

Pathway towards zero emissions

FutureGenPush the Technology Envelope

• Establish the technical, economic, and environmental viability of “zero-emission” coal plants by 2015; thus, creating the option for multiple commercial deployments by 2020

• Industry to validate DOE suggested goals:– Sequester >90% CO2 with potential for ~100%– >99% sulfur removal– <0.05 lb/MMBtu NOx– <0.005 lb/MMBtu PM– >90% Hg removal– With potential for a Nth plant commercial cost no more than 10%

greater than that of a conventional power plant

FutureGenIndustry’s View of the Facility

Air

Advanced Electricity

Generation

Research “User Facility”

Advanced Gas Clean-Up

SyngasSyngas CO2 H2

Advanced CO2 separation

O2 SyngasSyngas H2CO2Coal

Air

Slag

AirSeparation

UnitGasification Gas Clean-Up**

CO2Separation**

ElectricityGeneration**

Transportation and

other H2 uses

CO2Sequestration &

Monitoring

Electricity/Hydrogen Generation “Backbone” with CO2 Sequestration/Monitoring System

Advanced Oxygen

Separation

**Candidate for Multiple Technology Upgrades over FutureGen’s Lifetime.

Other Technologies

Electricity,H2, or

other Products

Advanced Coal

Conversion

Full-Scale Gasification

ResearchPlatform

Sequestration

Sub-scaleResearch

User Facility

POWERH2

POWER

FutureGenCurrent Activities

• Site Selection– “Final Four” announced July 25– NEPA process underway– Final site announced summer 2007

• Conceptual Plant Design– Reviews with major technology suppliers– Three alternative facility configurations– Conceptual design and cost estimate underway

• Conceptual Sequestration Design– Reservoir modeling for each site

FutureGenSiting Process Flow

Request for Proposals

Preferred Site

Notice of Intent

Record of Decision

Environmental ImpactStatement

US Government

Environmental Review Process

Qualifying CriteriaEliminated Sites

Scoring & Best Value Criteria

Eliminated Sites

Candidate Site List

Site Characterization &Environmental Information

Sites For Evaluation

Acceptable Site List

Final Decision Criteria

July 2006

July 2007

We Are Here

Proposed SitesMay 2006

March 2006

FutureGenSite RFP Criteria• Qualifying Criteria

– Each proposal evaluated against certain qualifying criteria (Y/N)

• Scoring Criteria– Each proposal scored on each criteria against a

predetermined scale – Weighting system used to roll-up criteria scores

• Best Value Criteria– Each proposal qualitatively evaluated against these

criteriaA report that details the process can be obtained from the

FutureGen web site www.FutureGenAlliance.org

FutureGenQualifying Criteria

17 Surface Criteria 18 Subsurface Criteria

FutureGenSite RFP Scoring Criteria

3.0 Power Plant

SiteCharacteristics

Construction &Operations

3.1 PhysicalCharacterisitcs

3.3 Proximity toSensitive Areas

3.4 Exposure toNatural Hazards

3.2 Other SiteCharacteristics

3.1.1Size

3.6 Water(Cooling)

3.7Transmission

3.8 Materialand FuelDelivery

3.2.1Road

Access

3.2.2Proximityto Target.Forma-tion(s)

3.3.2 TES& CriticalHabitat

3.3.3Cultural

Resources

3.3.4PublicAccessAreas

3.3.5 Non-Attainment

/ Maint.Areas

3.3.1Class I

VisibilityAreas

3.6.1Distance

3.6.2Adequacy

3.7.1 GridProximity

3.7.2Voltage

3.8.3Access toNatural

Gas

3.8.2DeliveryMode

Flexibility

3.8.1 Rail/BargeAccess

3.5.1SEPA

3.1.3Ele-

vation

3.7.3Rights-of-way

3.9Availability of

Workforce

3.9.3Construc-tion Cost

3.9.2Opera-tionalLaor

3.9.1Construc-tion Labor

FutureGen Siting Scoring Criteria

3.1.2Topo-graphy

3.2.5Existing

Land Use

3.2.3Dis-

persion

3.2.4 AirQuality

3.4.1Hurricane

3.4.2Tornado

3.1.4Flood-plain

3.5 Regulatory& Permitting

3.1.5Wetlands

4.0 Geologic Storage

Security

4.1 FormationProperties

4.1.2Orien-tation

4.1.4Capacity

4.2.1Faults

4.2.2Capillary

EntryPressure

4.2.4Injection

WellPenetra-

tions

4.2.5Other

Penetra-tions

4.2.3FractureGradient

4.3.1PhysicalAccess

4.1.1TargetForma-tion(s)

GeologicCharacteristics

4.1.5Size

4.1.3 Per-meability

4.2 Seals4.3 Monitoring,Measurement &

Verification

4.2.6Secondary

Seals

4.3.3Subsurface

Access

4.3.2Legal

Access29 Surface Criteria 14 Subsurface Criteria

FutureGenSite RFP Best Value Criteria• Land Cost• Availability / Quality of

Existing Plant and Target Formation Characterization Data

• Land Ownership• Residences or Sensitive

Receptors above Target Formation

• Waste Recycling and Disposal

• Clean Air Act Compliance• Expedited Permitting• Transmission

Interconnection• Background CO2 Data• Power Sales• Market for H2

• CO2 Title and Indemnification

• Other Considerations

FutureGen Site Selection Underway

12 Sites in 7 States Proposed

Candidate Sites

4 Sites in 2 States on Candidate List

Design and Cost EstimateFacility Goals

Key Goals– Generate 1 to 2.5 million tons per year CO2; (target

90% CO2 capture)– Design for all U.S. coals (primarily bituminous and

sub-bituminous). • Maybe other coals.

– Push the technology (“prototype plant of the future”)– Commercial-scale (275-MW nominal rating)

12,94113,00013,980HHV (Dry Basis), Btu/lb

17.27.875.51Oxygen

0.53.52.49Sulfur

0.010.190.1Chlorine

0.91.51.47Nitrogen

4.94.95.14Hydrogen

70.371.677.67Carbon

6.710.47.62Ash

DRY BASIS (wt%)

6.710.47.62Ash

48.940.338.94Volatile Matter

44.449.353.44Fixed Carbon

DRY BASIS (wt%)

27.67.82Equilibrium Moisture

2911.57Total Moisture

AS-RECEIVED (wt%)

PRBIllinois BasinNorthern Appalachian

Mean Property Values

COAL SPECIFICATIONS

Design and Cost EstimatePlant Design for Fuel Flexibility

Design and Cost EstimateScreening Criteria

• Economic Criteria– Capex Overrun Potential– COE Reduction Potential

• Technical Criteria– Coal Flexibility– Step-Outs– Schedule Risk– Mission Risk– Technical Risk

• Programmatic Criteria– Vendor Alignment– DOE-Developed Backbone Technologies

Design and Cost EstimateConceptual Design Decision Process

List of PossibleConfigurations

Conceptual Designs and Cost Estimates Based on Detailed Heat & Mass Balances and PrelimEngineering

CommonDesignBasis

High LevelFlow Sheets forConfigurations

Single Train(s)

Dual Train(s)

“Hybrid” Train(s)

DownselectBased onQualitativeScreeningCriteria

Alliance w/ EPRI, TEG, Battelle, Internal Support A/E Firm

“Factored”Cost

Estimates

LeadingCandidateCases

Meeting(s) withDOE-NETL

DownselectBased onFactored Costs & Technical Review + “Constraints”

VendorPresentations

~30 cases 13 cases 3 cases

We Are Here

Design and Cost Estimate

Design Cases

• Two Single Trains:– Slurry feed water quench– Dry feed water quench

• One Multiple Stream Hybrid:– 100% full slurry quench– 30% transport gasifier with ITM air separation

• Three coal types:– Northern Appalachian– Illinois Basin– PRB

These are design configurations for the conceptual design and cost estimate, not the final designs. The actual designs

will be established through competitive bids in 2007.

FutureGen

Phases of Sequestration

Preliminary Site Characterization

& Modeling

Detailed Site Characterization

Injection SystemDesign, Permitting,

& Construction

Operations &Monitoring

Post-injectionMonitoring

Closure

We are Here.2006

2018

CO2 Storage

Variety of Reservoir Types

Courtesy of Peter Cook, CO2CRC

-

1,000

2,000

3,000

4,000

5,000

6,000

7,000

8,000

9,000

CarbonContained in Global CoalResource

PotentialGeologic Storage

ReservoirCapacity

CarbonStorage

Demanded in 450

Stabilization

CarbonStorage

Demanded in 550

Stabilization

CarbonStorage

Demandedin 650

Stabilization

Gig

aton

s of

Car

bon

• Published estimates of potential storage capacity are approximately 3,000 GtC (11,000 GtCO2).

• In total this capacity exceeds the global need in ALL CO2 management regimes commonly discussed.

Potential Capacity

Potential Need

Sequestration Capacity: Is there enough?

Global Capacity Exceeds the Need

• 1,185 electric power plants • 447 natural gas processing

facilities• 154 petroleum refineries • 53 iron & steel foundries• 124 cement kilns

• 43 ethylene plants• 9 oil sands production areas• 40 hydrogen production • 25 ammonia refineries• 47 ethanol production plants• 8 ethylene oxide plants

2,082 Large Sources (100+ ktCO2/yr) with Total Annual Emissions = 3.8 GtCO2/yr

• 3,730 GtCO2 in deep saline formations (DSF)• 65 GtCO2 in deep unmineable coal seams with potential

for enhanced coalbed methane (ECBM) recovery• 40 GtCO2 in depleted gas fields• 13 GtCO2 in depleted oil fields with potential for

enhanced oil recovery (EOR)

3,800+ GtCO2 Capacity within 330 US and Canadian Candidate Geologic CO2 Storage Reservoirs

Sequestration Capacity: In Right Places?

Adequate Capacity in U.S.

~ 100 Years

FutureGenSchedule

EstablishLegal Entity

Limited Scope Cooperative Agreement

Negotiations

CooperativeAgreementNegotiations

Project Structuring & Conceptual

Design

Preliminary Design

Initial Full Scale Plant Operations

Site Monitoring Post Initial Operations

Alliance Proposal ---> BP0 BP1 BP4 BP5

DOE RAFA ---> BP2 BP3

BP2 BP3

DOE Projection

Final Design

BP0 BP1

FutureGen Summary Plan

Plant Start-Up and Testing

Facilities Construction

Full Scale Plant Operation Continues

Siting, NEPA, and Permitting

DOE/Alliance Sign

Cooperative Agreement

Critical Decision-1Approved

(Preliminary Baseline Range)

Critical Decision-2Approved

(Performance Baseline)

Critical Decision-3Approved

(Construction Start)

Critical Decision-4Approved

(Operations Start)

Oct 1, 2005 Jan 31, 2007 December 2007 July 2009 July 2016 July 2018

DOE/Alliance Sign Limited

Scope Cooperative Agreement

July 2012

v

ROD July 2007

Final Site Selected & Long-lead Procurements Sept 2007

PlantOnline2012

FutureGenFinancial Requirements

• DOE to provide $700M– $620M from Federal Appropriations

– $80M from Foreign Governments• India and South Korea are on International Steering Committee

• Industry to provide $250M– Expect to share between 10 to 14 full members

Summary

• FutureGen is real and moving forward fast

• FutureGen creates significant value– Supports a technology-based climate change strategy, which mitigates the

financial risk of climate change while protecting the environment– Validates the cost and performance of an integrated “zero-emission” coal-

fueled power plant– Creates the technical basis to retain coal in global energy mix with a long-

term goal of zero emissions.

• FutureGen is an opportunity to share the cost and risk of “zero emissions”technology development

Contact Information:

Michael J. MuddChief Executive OfficerFutureGen Alliancemjmudd@aep.com(614) 716-1585

Ken HumphreysTechnical Support, ManagerFutureGen Alliancehumphreysk@battelle.org(509) 521-7784

www.FutureGenAlliance.org