I went to a hearing on the Hill last Thursday pertaining to regulatory aspects of carbon capture, transport, and sequestration. The hearings were for the benefit of two bills (S. 2144 and S. 2323) making their way through the Senate Committee on Energy and Natural Resources, but were also conveniently held the day after the DOE announced it was backing out of the FutureGen project (at least in its current manifestation).
Indeed, the big attraction for many in attendance was the presence of James Slutz, Deputy Assistant Secretary in the DOE Office of Natural Gas and Petroleum. In a bold move, he started off asserting that “DOE has assumed the lead in CCS technology”. When pressed by Sen. Barrasso to explain how eroded confidence in public-private partnerships can be rejuvenated after the DOE FutureGen pullout, Slutz simply replied that “when a project doubles in cost, it’s time to rework the agreement”, that the project was “no longer in the interest of the American people”, and that market-based plants would be more successful. Aside from the fact that a large proportion of the cost overruns are related to inflation and delays, this statement also completely ignores the point of public-private demonstration partnerships. There is an enormous amount of risk involved in this type of project and, as such, it would not be viable as a purely private endeavor. FutureGen was not designed to be profitable, it was designed to demonstrate commercial-scale technology.