Cinergy/PSI, GE and Bechtel have signed a letter of intent to study the feasibility of a commercial 500-600 MW IGCC plant in Indiana, the first of its kind considered under the recently proposed GE-Bechtel alliance. The two companies announced in September their aim to develop a standard commercial offering for such projects in the USA.

PSI Energy, an operating arm of Cinergy Corp, which would own and operate the facility, is considering several sites, including its coal-fired station in Edwardsport, Indiana. The letter of intent is the first step toward a contract to design and construct the plant.

“We face the need for additional generation in Indiana,” said James E. Rogers, chairman and chief executive of Cinergy Corp. “Given the high price of oil and the limited supplies of natural gas available, coal is the most practical alternative. Our challenge is to find ways to use an abundant resource in an economic and environmentally clean way.”

It is likely to be february before the decision on whether to proceed and to find a location is made. The study will cover economic feasibility, plant performance and output, emissions, and the plant footprint. GE and Bechtel will also develop public and government support for the project.