The Mountaineer coal-fired power plant in New Haven could become the site of the nation's first commercial-scale carbon dioxide capture and storage system.

American Electric Power announced Aug. 20 that it is seeking $334 million in federal stimulus funds for a project that would go online in 2015.

"Commercialization of carbon capture and storage technology is an essential component in a successful climate strategy for this nation, which relies on coal-fired generation for about half of its electricity supply," said Michael G. Morris, AEP's chairman, president and chief executive officer, in a news release.

Carbon capture and storage is seen as necessary to maintain the economic viability of coal, a major source of the greenhouse gas carbon dioxide, as nations work to limit greenhouse gas emissions.

If funded, the project would follow a smaller, validation-scale CCS project that already is set to begin operation at the plant in September.

The validation project will capture the CO2 from a 20-megawatt slipstream of the plant's 1,300-megawatt capacity to demonstrate at a small scale the viability of a chilled ammonia carbon capture process for retrofitting coal-fired power plants for CCS.

At the same time, the company will monitor the movement of the CO2 once it is injected into porous rock formations more than a mile below the plant, providing new understanding of geologic sequestration.

AEP initially planned to follow the validation project with a commercial-scale CCS installation at a plant in Oklahoma.

"We intended to sell the captured CO2 to a company that would have used it for enhanced oil recovery," said AEP spokesman Pat Hemlepp, referring to a technique in which carbon dioxide is injected underground to push out crude oil. "Instead of storing the CO2, it would have become a useful product."

But AEP's partner in that project, SemGroup, filed for bankruptcy in July 2008.

"We know that there is a suitable storage site where the Mountaineer plant is," Hemlepp said. "Since we also know we have enough of a footprint at the plant to be able to build the commercial system there, we decided to go ahead and proceed with it at Mountaineer."

The commercial-scale project would capture 90 percent of the CO2 from 235 megawatts, or about 20 percent of the plant's 1,300-megawatt capacity, and would again inject it underground.

Because CCS is considered crucial to the future viability of coal-fired power generation, it is appropriate that federal stimulus funds should help companies such as AEP that undertake demonstrations, Morris said.

"Without efforts like ours, the availability of solutions for reducing carbon dioxide emissions from coal-fired power plants will be needlessly delayed," he said.

An online database maintained by the Carbon Capture and Sequestration Technologies Project at the Massachusetts Institute of Technology lists a variety of commercial-scale projects planned around the world through 2015.

However, according to the database, the Mountaineer installation would be the first CCS project in the U.S. over 25 megawatts at a retrofitted coal-fired power plant -- giving it particular importance in the quest to continue to operate coal-burning plants as greenhouse gas emissions are regulated.

Even before the small-scale validation project goes online, the Mountaineer plant has become a destination for visitors interested in the technology, Hemlepp said.

"When we move ahead with the full commercial one, it will be the biggest and highest-profile carbon dioxide capture and storage project in the world," he said, "so there would be a lot of people coming to see it and learn about it to see how the technology can apply to their operations."

AEP applied to the U.S. Department of Energy's Clean Coal Power Initiative, which according to the DOE Web site is offering Round 3 funding of up to $1.4 billion to applicants who will share at least 50 percent of the cost of their projects.