On July 14, 2011,
American Electric Power announced it had suspended plans to advance the carbon
capture and storage project at its Mountaineer power plant in Mason
County to the next level.
AEP began the project in September 2009. It captured carbon
dioxide emissions from a small part of the power plant's output – 20 megawatts
out of 1,300 – and pumped it into a deep saline formation.
With federal cap-and-trade legislation dead, AEP determined
it could not ask the Public Service Commission to allow it to raise rates to
continue and expand the project.
Last week, Nick Akins, AEP's chief executive officer,
discussed the carbon capture and storage project with local reporters before he
gave a speech to students at the University
of Charleston.
Following is a transcript of his remarks.
Akins: "Climate change legislation went by the wayside.
There was no value placed on CO2, so it was hard to get investors. The (Department
of Energy) was in for half of the upscale project where we were going to move
to more of a commercial scale at 235 megawatts. …
"It was difficult to continue with that investment. The (state
public service) commissions themselves, everything we do, we ask for recovery
from the commissions because we are regulated utilities. Without rules in place,
it was difficult for the commissions to approve continual spending on that type
of expense. It was a large expense. We were talking about $664 mi. $332 (million)
of that was covered by the U.S.
government – the DOE – but we still had
to find a home for the other $332 (million).
"So we canvassed the world, looking for international
investors as well. With no price for CO2, it was difficult for them to invest,
so it became really clear we were not going to be able to move forward with the
project. But what we did, we finished up the front-end engineering and design
for the upscale project, and it's sitting on the shelves waiting for the opportunity
to invest in that project or others.
"That technology clearly has to move forward. The Chinese
are working on it. There are some projects that are capture technologies, not
so much storage that are going on now. One of the big emphases placed today is
finding a use for carbon in the future so you don't have to store as much.
"I think it's important for us to continue to work on those
types of technologies. We still participate in a DOE facility in Alabama
that is focused on trying out various technologies for the capture of CO2. … There's
a view we have to continue to push the technology. What we have to have is some
kind of mechanism to really do that. Like I said, it's on the shelf waiting.
"I think if you have new source requirements coming out of the
EPA that are focused on carbon reductions from new coal plants, that's going to
drive investment to occur, because if you want coal to stay in the picture in
the US, you're going to have to answer at least some CO2 questions.
"I think that's true for any fossil fuel eventually, but
like with anything else we need time to develop the technology. And from the
policy side, usually, it gets way ahead of technology.
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