ALSTOM’S U.S. HEAD CALLS FOR CARBON PRICE

Tamar Hallerman
GHG Monitor
10/25/13

Alstom’s top American official said that “uncertainty is the new normal” in the country’s power generation industry and called on policymakers to establish a flexible market-based price on carbon in order to drive down emissions and incentivize clean energy RD&D work. In a speech at an energy industry conference near Washington this week, Alstom’s U.S. President Amy Ericson laid out her vision for what a national energy policy should include if policymakers want to incentivize carbon capture and storage and other clean energy technologies. She said decisionmakers need to develop regulations that “keep all available energy sources in the mix, including coal.” “Those regulations should create a framework for leveraging public and private financing to fund large-scale demonstrations, because many of these technologies are at that critical step in their evolution,” she said during a speech at the University of North Dakota’s Energy and Environmental Research Center’s Air Quality IX conference earlier this week in Arlington, Va. “The regulations also need to be a part of a broader, long term policy that’s not going to change that will provide a clear framework and set realistic but ambitious goals that align with the current state and pace of technology development.”

Ericson called on technology development companies to lead the way in providing options for utilities to comply with upcoming carbon regulations for new power plants being promulgated by the Environmental Protection Agency. “Like we once did for the Clean Air Act [amendments of 1990], it’s time for America’s air pollution control companies to bring forward the technologies that will enable U.S. power plants to use our domestic resources,” she said. “If you look at the scenarios put forward by the IEA in order to meet certain climate change goals, we all know that the existing fleet will need some type of control system, some type of capture and mitigation.” Reintroduced last month, the standards essentially require new coal plants to include carbon capture and storage technology to limit carbon emissions. Coal boosters and business groups have argued that CCS is not yet ready to be mandated on such a wide level. However, EPA has said that the Clean Air Act (CAA) has precedent for being technology forcing—the agency’s top brass has pointed to the example of FGD scrubbers as coal plant technologies whose cost was driven down after being mandated by the 1990 CAA amendments—and said that the CO2 emissions standards would do the same for CCS.

Financial Framework Needed, Ericson Says

Technology development companies like Alstom stand to win big with EPA’s carbon limits for new and existing power plants, selling the technologies utilities need to comply with the rules. But Ericson said more is needed beyond the EPA regulations in order to truly incentivize CCS technology, RD&D work she said has “largely ground to a halt” in the U.S. outside of a handful of demonstration and proof-of-concept projects. “Until carbon reduction is supported by some financial framework, private companies have little incentive to invest in and fund new, large-scale CCS demonstration projects,” she said, adding that some sort of nationwide price on carbon or clean energy standard is needed in order to truly incentivize development.

Alstom was the carbon capture technology provider for American Electric Power’s Mountaineer CCS demonstration project in West Virginia, which was shelved in 2011 due to what officials said was a lack of a federal climate policy and failure of the project to get rate recovery from the state public utility commission. While Alstom is also developing chemical looping technology as a second-generation CCS option, the only utility-scale project the company is currently involved with is the White Rose CCS project in the U.K., a 426 MW oxy-combustion new-build which Ericson said is possible due to “innovative funding mechanisms on the table and available” in the U.K.