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Senators Re-Introduce Coal-to-Liquids Legislation

US Senators Jim Bunning (R-KY) and Barack Obama (D-IL) have re-introduced a piece of legislation that would help create the infrastructure needed for large-scale production of Coal-to-Liquids (CTL) fuel in the US.

The proposed “Coal-To-Liquid Fuel Promotion Act of 2007” is based on the bill first introduced by Senators Bunning and Obama last spring and expands tax incentives, creates planning assistance, and develops Department of Defense support for a domestic CTL industry.

The Coal-to-Liquid Fuel Promotion Act of 2007 enables the Department of Energy to provide loan guarantees for construction and direct loans for the planning and permitting of CTL plants. Loan guarantees will encourage private investment and planning loans will help companies prepare a plant for construction.

This legislation also will expand investment tax credits and expensing provisions to include coal-to-liquids plants, extend the Fuel Excise Tax credit, and expand the credit for equipment used to capture and sequester carbon emissions.

Finally, the bill provides the Department of Defense the funding and authorization to purchase, test, and integrate these fuels into the Strategic Petroleum Reserve and military fuel supplies.

The Senators also announced they will form the Senate Coal-to-Liquid Fuel Caucus to help drive the legislation forward.

Both Kentucky and Illinois have massive coal reserves. Obama also sponsored the just-introduced BioFuels Security Act of 2007 that would institute a 60 billion gallon Renewable Fuel Standard by 2030. (Earlier post.)

Comments

Aussie

I thought Obama was in the Gore camp w.r.t. climate change. Perhaps lobbyists have worked on him. There are no problems with CTL provided a meaningful CO2 cap is in place. More CTL would then mean less coal fired electricity for air conditioned shopping malls.

Lad

Are we trading air-dirty oil for air-dirty coal? Don't know what's in the bill; but, I hope it includes at least smoke stack scrubbers for the current acid- rain problems and smog-less burning requirements for the autos.

Patrick

Coal mining is a large industry in IL but not as big as some other states like KY. WY easily does 1/3 of all coal mining in the US so I'm surprised they didn't get a senator from that state involved as well.

Neil

I would also hope it contains sequestration of the extra CO2 generated by the process (or at least algae culture).

earl

Obama is from a coal state.As are other now powerful dems.The best bet is to push for adapting algea tech to these kinds of plants.There are to many dollars and votes to expect dems to shy away from this tech.Ctl is a powerful security tool for national and military independence.Perhaps Obama and others will push for loan guarantees to be coupled with sequestration.This will happen so its probably more productive to look for best mitigation as opposed to fighting it.

Nate Fairchild

Coal in Wyoming is low sulphur - CTL favors cheaper high-sulphur (less desirable for burning in coal power plants because of acid rain) coal because the FT process cleans out the sulphur. Illinois and Kentucky have high sulphur coal, so a robust CTL infrastructure would benefit those states the most in terms of production/jobs/pork etc.

SJC

The Governor of Montana has been preomoting CTL with sequestration for years. He was on 60 minutes one night showing what can be done. Maybe they can get something going that the private sector has not.

t

I don't know if this includes sequestration. If it does not, that will be one less candidate I need to analyze for 2008. Now, I guess, we know what Obama means when he says he supports alternative fuels. Obama appears to be in the camp that will do everything possible to ensure that we continue easy motoring in America.

We don't need a renewable fuel standard. What we need to do is realize what a disaster ethanol is with respect to reasonable food prices in America. If anything, we need a moratorium on anymore ethanol plants in America.

Obama is like virtually like every other politician; he is afraid to tell people that we can't have both, a livable planet and one that is banking its future on coal.

eric


Obama just lost my vote....

FYI co2

Good stuff, t!
Obama must have learned about supply side economics (without regards to external costs CO2) in a moment of bipartisanship. He's certainly doing a good job grabbing the low-hanging fruit!

John

1. Does anyone know if CTL can be performed with salt water?

Like someone else said, this will probably happen; Big Coal is too big for it not to happen. All we can do is hope for the best.

CTL wouldn't be a terrible thing if it is done the right way. I'd support the bill if it had conditions that stated that all excess CO2 emissions be captured by algae.

Dirty air from U.S. CTL beats dirty air from Arab oil in my book...but not by much...

gr

Gee I don't know guys, the image of new belching smokestacks in the midwest seems unbelievable even for greedy politicians these days. Yeah, the deal is CTL provided the emissions are controlled or better, captured by algae for another source of revenue. It's not stellar navigation to get greedy energy producers to produce more energy for more income... is it?

Paul Dietz

Does anyone know if CTL can be performed with salt water?

The cost of desalinating the water that's used for CTL will be a small fraction of the cost of CTL. Remember, the water actually consumed in the chemical reactions isn't much, roughly the same volume as the liquid produced. Desalinated sea water is about 500 times cheaper, per unit volume, than crude oil.

Engineer-Poet

It might be okay even with the salt; the Wabash River plant needed a chloride scrubber even running on fresh water, so it may just be a question of efficiency.

The lousy efficiency and GHG emissions should rule this out, though.  Why on earth would these guys go for CTL instead of IGCC and electric vehicles?  Don't they know it's possible, or is there a hidden agenda?

Nick

Digging permanently sequestered carbon (coal) out of the ground and spewing it into the air in the form of CO2 would be a total non-starter if the true long-term costs were factored in. (Got to get to that worldwide carbon cap and trade system somehow...)

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