AEP sees carbon capture from coal ready by 2015

SAN FRANCISCO Thu Jun 25, 2009 6:57pm EDT

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SAN FRANCISCO (Reuters) - Technology to capture carbon emissions from coal-fired power plants and store them underground will be ready by 2015 and could be in wide use in the United States by 2020, according to the top executive at American Electric Power Co Inc.

Mike Morris, CEO of Columbus, Ohio-based AEP, one of the largest U.S. utilities, said his company's work in West Virginia on carbon capture and sequestration (CCS) gives him more insight than skeptics who doubt the technology.

"I'm convinced it will be primetime ready by 2015 and deployable," Morris said in an interview with Reuters on the sidelines of the Edison Electric Institute conference . "Then, it will probably spread across the system in the next half decade (after 2015)."

"You could argue that by the time you get to 2020, it will be available, understood and a technology that works. A lot of my colleagues think that will be 2025 or beyond, but they all think they will get their nuclear power plants built by 2015 but I don't think they will. Time will tell," Morris said.

Some see carbon capture and sequestration as unproven for utility-scale plants and overly hyped by companies like AEP that rely on coal-fired power plants. About three-fourths of AEP's generation comes from coal-fired plants.

Morris and other utility executives, along with President Barack Obama, say the technology must be a key element of energy policy. These supporters note that coal generates half the electricity in the United States and that the country has abundance of coal resources. Power demand is expected to grow by 20 percent in the United States by 2030.

SOLAR AND WIND UNCERTAIN

Morris said coal must remain a key part of the energy picture because of uncertainties about renewable power like solar and wind and an unclear picture of nuclear power growth and the volatility of natural gas prices.

On Tuesday, Microsoft's chief research and strategy officer, Craig Mundie said he did not think solar or wind would ever be more than a "bit player" as far as meeting U.S. power demand.

Jeff Anthony, utility program manger for the American Wind Energy Association (AWEA) and Portland General Electric Co chief executive Jim Piro disagreed with Mundie's assessment. But Morris agreed.

"I don't think solar or wind will ever be the dominant player," Morris said.

Morris said even with conventional-sized wind and solar plants on-line, the Federal Electric Regulatory Commission (FERC) will need more power to facilitate the building of a reliable and expanded national power transmission grid.

"I think coal will always be the dominant player. Nuclear will grab a larger segment of the market. Eventually, natural gas will either hold its place or diminish some, and that space will probably be taken over by the sun and the wind, but I don't know that you'll ever get over 5 percent, maybe 7 percent of system-wide national demand for wind and solar," he said.

Currently, about 50 percent of the power delivered in the United States comes from coal with 20 percent each from nuclear power and natural gas. Renewable power that does not include hydropower projects is only about 3 percent.

(Reporting by Bernie Woodall; Editing by David Gregorio)

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