Alternative energy a popular stop in U.S. campaign

By Andrea Hopkins

WELLSVILLE, Ohio (Reuters) - A small green clearing on a hilltop beside the Ohio River doesn't seem like much of campaign stop, but John Baardson knows the scent of alternative energy and undecided voters will lure America's presidential contenders before long.

"McCain has already called and expressed interest, and we believe Obama will too," said the president and chief executive of Baard Energy.

Before Americans go to the polls in November to choose Republican John McCain or Democrat Barack Obama to be the next U.S. president, Baardson plans to break ground on a $6 billion plant in Wellsville that will turn Appalachian coal into 53,000 barrels a day of diesel and jet fuel.

The plant, designed to produce fuel that costs just $60 to $70 a barrel with 46 percent fewer emissions of carbon dioxide and other greenhouse gases than conventional diesel fuels, is an irresistible draw for the 2008 presidential hopefuls.

With oil at $130 a barrel and gasoline at $4 a gallon, energy and the economy has vaulted to the top of the political agenda, and McCain and Obama have both sought to portray themselves as proponents of cheaper alternatives.

That Baard's plant will be in Ohio, the politically critical state in President George W. Bush 2004 election victory that could once again help determine the outcome of this election, is just a happy coincidence.

"The politics are fascinating," Baardson said. "We want to drive home the point that if you want the voters in this area, this is something you can give them ... the price of oil is the number one issue out there and we have a clean solution."

The plant will bring at least 1,500 construction and 200 full-time jobs to impoverished eastern Ohio. In addition, some 18,000 tons of coal a day will be liquefied into fuel suitable for use in jets and trucks -- adding an estimated 750 mining jobs to the mix.

In return for the jobs and home-grown fuel supply, Baard wants the government to offer loan guarantees and Air Force fuel contracts. The state of Ohio helped lure the plant, which is mostly privately funded, with tax incentives.

While conservative Republicans see more drilling as the best answer to America's oil needs and liberal Democrats want to focus on wind, solar and biofuels, the politics of coal -- which supplies about 50 percent of America's energy needs -- is complex.

Moderates on both sides have found something to like about Baard's coal-to-liquid plant, which gasifies woodwaste and coal and captures and sequesters about 85 percent of the resultant carbon dioxide emissions in the region's coal beds.

More importantly, analysts believe embracing coal-to-liquid technologies and others like it may offer Obama a way to win over white working class voters in the area, an economically depressed but culturally conservative region that supported rival Hillary Clinton in the Democratic nominating process.

TOO CLOSE TO CALL

Obama has a track record of supporting coal, since coal mining is also a staple of his home state, Illinois. But whether that will be enough to win over voters concerned about his race or reputation as a liberal elite is not clear.

"Right now Obama has the more difficult challenge in this region than McCain, but the economy is in lousy shape so Democrats should be able to connect," said Herb Asher, a professor of political science at Ohio State University,