B&W TAKING ‘PHASE BY PHASE’ APPROACH TO FUTUREGEN, OFFICIAL SAYS

Tamar Hallerman
GHG Monitor
6/21/13

BARBERTON, OHIO—Babcock & Wilcox Co. is looking to take a “phase-by-phase” approach to the FutureGen 2.0 carbon capture and storage project in western Illinois, the head of B&W’s power group told GHG Monitor here last week. Randy Data, president and chief operating officer of Babcock & Wilcox’s Power Generation Group (B&W PGG), said the company is currently focused on completing Phase II engineering and design work for the 167 MW retrofit and is not letting uncertainties surrounding project cost and schedule, as well as legal and political pressures, affect its decision-making in the near-term. B&W PGG is supplying FutureGen’s oxy-combustion capture system, boiler, air quality and other environmental control systems. “We will continue to try and meet what our customer’s needs and expectations are and support [the FutureGen Alliance] in that endeavor. From our standpoint, we are just looking phase to phase,” Data said during an interview at B&W’s R&D facility here. “We’re trying not to look at the whole long road.”

While some of FutureGen’s other partners, most prominently its former utility lead Ameren Energy Resources, have stepped back from the project in recent years as it hit various snags, Data said B&W PGG is not deterred by any of the $1.65 billion project’s current uncertainties. “We’re a commercial business, so there are challenges every day … We’re making very complex things, and we understand that’s part of the journey—that’s not something new for us,” he said, emphasizing the “inherent environmental advantages” of oxy-combustion capture technology compared to other CO2 separation systems on the market. He said FutureGen is a plum opportunity to demonstrate the company’s technology with significant government support. “We’ve always taken the view that goes back to the portfolio of solutions, and I think the country will be better if we invest in multiple, different solutions and not put all of it in one basket,” Data said. “Until you fully demonstrate something, I don’t think you know its true power.”

‘Portfolio Approach’

B&W’s role in FutureGen is anchoring its current research into oxy-combustion capture technology, but the company is also marketing a post-combustion CO2 capture system called RSAT (Regenerable Solvent Absorption Technology), which uses a liquid solvent in an absorber vessel to remove CO2 from a power plant’s flue gas stream. Data emphasized B&W’s “portfolio approach” to CCS, which it is moving forward with using research from a newly-built R&D facility here. Data said among other second-generation capture technologies being tested in Barberton, the company has taken an early interest in chemical looping, partnering with the Ohio State University and the Department of Energy for small-scale work. The company is looking for a “leapfrog” technology that can significantly decrease the energy penalty and costs associated with carbon capture to make it a competitive clean energy technology, Data said. “We’ve taken the approach from a macro standpoint of really having a portfolio of different solutions and understanding that each one of those solutions may best fit a certain application whether that’s related to an existing piece of equipment, a new piece of equipment or otherwise,” he said.

But despite the significant investments B&W made into CCS technologies in the early 2000s—when the federal regulation of carbon via a pricing scheme like cap-and-trade appeared all but inevitable—Data acknowledged that R&D work has slowed in recent years due to the lack of a business case for CCS. “You have to shift to some extent. We are not a non-profit organization and we only have so many funds that we could invest back into the business,” he said. Data added that many of the systems and technologies B&W has built have stopped ahead of the demonstration phase in recent years because significant federal money has appeared to have dried up in the wake of the budget crunch in Congress. B&W is at the point “where we need to have participation with governments to say how we’re going to take these technologies and bring them into the marketplace if it’s indeed important to do that from a taxpayer standpoint, because the money has to come from somewhere,” he said. “Our challenges have been that we don’t want to shut off the funds, but we have to manage that as well as we can because we’re always looking at different opportunities in investment.”

This is the first of two interviews with B&W executives about the company’s outlook for technologies like CCS. Check back next week for a Q&A with company President and CEO Jim Ferland.