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DOE's $8B Clean Tech Effort to Aid Fossil Fuels

As part of President Obama's climate action plan (see NGI, July 1), the Department of Energy (DOE) last Tuesday announced a draft $8 billion loan guarantee solicitation to develop advanced technologies aimed at avoiding and reducing greenhouse gas (GHG) emissions from fossil fuels.

The Obama administration plans to seek applications for projects and facilities that cover a wide range of technologies, including fossil technology that is new or significantly improved, as compared to commercial technologies currently in use in the United States; advanced carbon capture technology; low-carbon power generation systems; and efficiency improvements.

Applicants will have the burden of showing that their technologies emit lower GHG pollutants, DOE said. Projects deploying these technologies are typically unable to obtain commercial financing due to high-technology risks.

"These investments will play a critical role in accelerating the introduction of low-carbon fossil fuel technologies into the marketplace and reduce greenhouse gas pollution," said Energy Secretary Ernest Moniz. "Fossil fuels currently provide more than 80% of our energy, and adopting technologies to use them cleanly and more efficiently is critical to our 'all of the above' [energy] approach."

The draft loan program is authorized under Section 1703 of the Loan Guarantee Program. The draft loan solicitation will be open for comments from industry, stakeholders, and the public until early September.

Resources extraction and development account for roughly 5% of the nation's GHG emissions. Advances in technologies and practices associated with developing oil, gas and coal offer the ability to improve efficiencies and reduce upstream GHG emissions associated with producing and delivering fossil energy to end-users, DOE said. Projects qualifying for a loan may include, but are not limited to:

The loan outreach also would extend to carbon capture technologies.

"The purpose of carbon-capture technology is to selectively remove CO2 [carbon dioxide] from process streams and flue gases, and produce a concentrated stream that can be compressed and transported to a permanent storage site. While initial eligibility will ultimately be evaluated on a project-by-project basis, DOE said it anticipates that qualifying projects could include CO2 capture from synthesis gases (syngas) in fuel reforming or gasification processes (see related story); flue gases in traditional coal or natural gas electricity generation; and effluent streams of industrial processing facilities.

The department also is looking for low-carbon generation systems that generate electricity and do not require traditional gas separation technology in order to capture CO2 emissions. Those qualifying projects for a loan may include coal or natural gas oxycombustion; chemical looking processes; hydrogen turbines; and syngas, natural gas or hydrogen-based fuel cells.

Industrial fossil-based systems typically use only a fraction of the energy available from their feedstocks, and often reject a large amount of low quality and waste heat from their processes. Technology improvements to increase the efficiency of fossil-based systems can result in reduced emissions-per-product and better feedstock utilization. To obtain a loan in this particular technology area, DOE believes the top candidates would be combined heat and power; waste heat recovery on industrial facilities; and high-efficiency distributed fossil power systems.

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