Chinese institute licenses clean coal technology to FutureGen

China's Thermal Power Research Institute has licensed its clean coal technology to the high-profile FutureGen project, in a deal that will likely result in Chinese machinery being used in the controversial US carbon capture initiative.

The institute is 52 per cent owned by China Huadian, one of the country's largest utilities, with the remainder held by other domestic state-owned energy firms.

Huadian is also a stakeholder in FutureGen, a 275MW research and development project in the US intended to demonstrate how to sequester carbon from coal, while also showing how hydrogen could be produced from the fossil fuel. Critics said the $2.4bn (£1.4bn) project was too expensive and relied on unproven technology.

The deal, signed earlier this month, gives FutureGen the right to use the China institute's Integrated Gasification Combined Cycle (IGCC) technology to turn coal into synthetic gas. Particulate matter such as mercury and sulphur is removed from the gas, which is used to fuel a combined cycle system, in which it powers a turbine generator before the waste heat is captured to power a second steam turbine system.

The FutureGen project, which was dropped in February last year due to soaring costs, was revived last month after the Obama administration committed $1bn in new funding.

Zhu Songbin, managing director of energy consultancy Songlin Group, told the South China Morning Post newspaper last week that "China's manufacturing cost advantage has probably contributed to Huaneng winning the deal."

Technology from the Chinese institute is also being used at the country's first clean coal power plant being built in Tianjin.

The $1bn project, called GreenGen, is the nation's first commercial-scale facility to use carbon capture and storage. All the components for the plant are being produced domestically, with the exception of a gas turbine power unit.

In April, the institute signed an agreement to license its technology to a 150MW IGCC plant in Pennsylvania. The facility, to be built in 2010, is owned by Future Fuels, a Texas-based developer of coal-based energy projects.

Financial details were not disclosed for the FutureGen and Future Fuels deals.