Funding for a large carbon capture and storage project in Texas has been pulled by the US Department of Energy. A move which, the project’s developer, Summit Texas Clean Energy says will effectively kill the Texas Clean Energy Project.
Reports show that this is the fifth carbon capture and storage project the DOE has backed away from. In February, the DOE denied Summit Texas Clean Energy’s request for an $11 million advance. Also, in the agency’s budget request for the fiscal year 2017, the DOE asked Congress to suspend the $240 million pledged to the project.
The DOE’s inspector general’s office issued a report on the CCS project last month, sounding alarm bells about the developer’s inability to secure commercial funding for the long-delayed plant. “Although construction of the plant was originally planned for completion in June 2014, the Project remains in the project definition phase,” it said. “Additionally, we found that the Department had taken actions that increased its financial risk in the Project.”
While carbon capture and storage technology is expected to play a major role in reducing existing coal-fired power plants’ emissions, the technology remains expensive and unproven.
Government policies that support carbon capture and storage are the “missing ingredient” in faster adoption of the technology, according to researchers and NGOs as well as energy majors. BP and Shell have called for a carbon price, which they say would make carbon capture economical.
Texas Clean Energy Project is projected to capture 2 million tons of CO2 annually or 90% of emissions from a coal-gasification plant.