Vol. VII No. 7
February 15, 2002

End the Clean Coal Program

This week the Senate is expected to start debating legislation that includes billions in tax breaks and subsidies for almost every energy lobby in Washington. One such example is the Clean Coal Power Initiative (CCPI) - formerly called the Clean Coal Technology Program (CCTP) -- which is slated to receive $10 billion over 10 years to continue a program that has already cost billions of taxpayer dollars with very little success.

The General Accounting Office (GAO) studies documenting the waste and mismanagement within the CCTP have produced enough paper to fuel a power plant. Since 1984, this program has received more than $2.4 billion to fund research and development of experimental technologies that have not been proven to be any cleaner than traditional coal burning technologies.

The Healy Clean Coal Project, located 10 miles outside of Denali National Park in Alaska, is an example of one Clean Coal project gone bad. In the late 1980’s, the project received $117 million in federal subsidies to build a new plant so that it could test a new kind of coal combustor that emits less pollution. After its completion, the plant went through two years of testing which finally deemed it unsafe and unreliable. The plant has been sitting idle since 1999, but still costs the state of Alaska $9 million a year in debt service on bonds and maintenance on the generator.

To top it all off, Healy’s older coal plant, located right next to the new one, now pollutes less than the Clean Coal Plant would - thanks to a retrofit on their conventional combustors. Not surprisingly, the new plant’s only viable customer, the Golden Valley Electric Association, is no longer interested in leasing a plant that costs more to run and has no measurable benefits associated with this extra cost. In order to keep Golden Valley’s business, the Healy Clean Coal Project’s leaders are now asking the federal government to loan them $125 million so they can retrofit the “clean coal” plant with traditional technology.

The Healy Clean Coal Project is just one example of many Clean Coal projects that have wasted millions of taxpayer dollars. The GAO has documented an inexcusable amount of waste and mismanagement within this program, including six major Clean Coal projects that are running seriously behind schedule and two projects in bankruptcy.

Despite all the evidence that proves otherwise, the Department of Energy considers the Clean Coal program a success. They say that experiments like the Healy Clean Coal Project prove that it’s possible to develop cleaner burning coal plants. However, stronger standards in the 1990 Clean Air Act have also led to cleaner burning coal plants, but they haven’t cost taxpayers billions of dollars in research and development.

The legislation before the Senate currently includes several new tax breaks for Clean Coal technology. In addition to subsidizing its development, the bill includes tax breaks to energy companies for using the costly technology. The credits are estimated to cost taxpayers $1.9 billion over ten years, according to the Joint Committee on Taxation.

After two decades of failures, the current Senate bill only prolongs the politics of the past, by keeping coal companies on the federal dole. The Senate should demonstrate a little fiscal responsibility and stop funding Clean Coal.