Obama puts flagship FutureGen project back on the agenda

In yet another turnaround, the Obama administration has moved to revive the high profile FutureGen carbon capture research programme, reversing a controversial Bush-era decision to axe the ambitious clean coal project.

FutureGen was originally conceived as a 275MW research and development project that would demonstrate how to sequester carbon from coal, while also showing how hydrogen could be produced from the fossil fuel.

The Department of Energy effectively canned the project in February last year, arguing that costs were skyrocketing. It cut funding to the FutureGen Alliance, which is the consortium of companies undertaking the project, and scaled down the project by allowing the companies to use traditional coal-burning methods - that would not produce hydrogen - to generate the carbon for sequestration.

However, president Obama's Energy Secretary, Steven Chu, announced late last week that the DoE will provide $1.073bn of funding to the project, the vast majority of which is to come from stimulus package funding.

The 20 member companies of the Alliance are also expected to contribute between $400m and $600m to the project, and from the end of July they will begin redesign activities and cost estimate revisions. Early next year, the DoE and the FutureGen Alliance will decide whether to proceed with the project based on the updated cost estimates.

Significantly, the FutureGen Alliance had protested that the DoE's original decision to cut funding was based on erroneous figures.

The DoE had said its share of the project cost had risen to $1.8bn. The Alliance retorted that the Department was factoring in rising materials costs, and that its true share was $1.1bn - close to what the Obama administration's DoE is now contributing.

The Bush-era DoE decision was criticised in March by a General Accounting Office report that said it had made basic accounting errors in its cost estimates.

FutureGen is based in Illinois, which is the President's former Senate seat.