Gasification plant to extend reach of clean coal

A plan for an integrated gasification combined cycle plant that is set to use carbon capture and sequestration has been unveiled by American Electric Power in a submission to Ohio state regulators.

At 600 MW and $1.03 billion, the clean coal plant is smaller than the $1.6 billion, 1,000 MW development proposed last year by AEP, although a second 600 MW unit is planned later.

However, IGCC plants typically cost about 20% more than conventional plants and AEP wants Ohio consumers to contribute to the development costs. The company has proposed a three part plan that will see ratepayers contribute $238 million in construction costs from 2007 – 2010, when the plant is expected to begin commercial operations, and ultimately the full development costs.

If Ohio commissioners reject the proposal, the utility is reportedly prepared to take the plant elsewhere, possibly to Kentucky or West Virginia, company officials reportedly said.

Cinergy, which also proposed an IGCC plant last year, is similarly turning to consumers to fund its proposed $900 million plant in Indiana. Cinergy has forged an alliance with GE and Bechtel in order to spread the development risk for the new facility.

There are currently two IGCC plants in operation in the US, but both are relatively small demonstration plants.