BAKERSFIELD, Calif. -- Mayor Harvey Hall can get very excited about efforts to "decarbonize" California's energy system.
His city is the hub of Kern County. Its two major businesses, agriculture and oil, are in a severe slump. Unemployment is running about 17 percent. "I've lived here all my life," explains Hall, 69. "This economy is probably the worst that I've ever seen."
So when BP PLC and Rio Tinto, the big British-Australian mining company, decided on a Kern County site to build the nation's first large facility to remove 90 percent of the carbon from coal-fired electricity, Hall became one of its evangelists. "Two billion dollars. That's big!" he exclaims.
Actually, it's $2.3 billion, with $308 million awarded to the project by the U.S. Department of Energy. When it is completed, perhaps as early as 2015, it will dramatically transform some pastureland 40 miles west of Bakersfield into a power plant that can remove 90 percent of the carbon emissions from coal -- something that has never been done before on a commercial scale.
Beyond that, the facility called the Hydrogen Energy California project -- HECA for short -- will begin to nibble away at California's most vexing carbon emission problem: its sprawling transportation system. It is also being designed to burn the charred residue from petroleum refining, called petroleum coke. The result will be nearly carbon-free electricity. (Normally, "petcoke" is exported to Asia, where it is burned in conventional power plants that vent the resulting CO2 into the atmosphere.)
This pioneering effort is being closely watched from a number of levels. Hall, who owns businesses in Bakersfield, is looking for the ripple effect from 1,500 construction jobs to lift its economy and the area's slumping tax base.
California is not normally regarded as being in "coal country" because it gets most of its electricity from plants that burn natural gas. But coal-producing Western states, such as Wyoming, are anxious to see whether California's regulators will give power made from "decarbonized" coal or petcoke premium rates that make it competitive with electricity made from natural gas and wind power.
They are intensely interested because between 20 and 30 percent of California's electricity comes from out of state, most of it produced by coal-fired power plants.
Bringing CO2 to played-out oil fields
Environmental groups are split. Some want the state with the nation's first economywide carbon cap to lead the way to carbon capture and storage, or CCS. Others argue that developing such CCS projects will take money away from renewable energy projects.
Finally, there is Occidental Petroleum Corp., owner of the Elk Hills oil field, the largest in California, which is just 4.5 miles from the HECA site. It has a contract to buy 5,500 metric tons per day of the CO2 that will be captured by the plant. At Elk Hills, Occidental will inject it 6,000 feet down into the oil reservoir. Occidental estimates that the CO2 will help it produce an additional 15 percent of the oil that would otherwise remain trapped in the ground.
"Parts of it [the oil field] were sitting idle, waiting for new technology and this is it," explained William Barrett, an engineer overseeing the project for Occidental.
So far, the HECA project has charmed state regulators. "It really is a win-win-win-win-win," said Michael Peevey, president of California's Public Utilities Commission. He noted that such carbon capture and storage projects will have to happen "on a large scale in California" if the state is going to meet its goal of cutting carbon emissions by 80 percent by 2050.
HECA still has a ways to go. It must get permits from 18 different federal, state and local agencies before construction can begin next year. In November, Californians vote on a referendum that would suspend the state's pioneering climate law until unemployment levels decline, which could halt state efforts on the project.
Then there is the precarious state of BP, one of HECA's two sponsors. While BP has shown no sign of withdrawing, the billions of dollars the company is paying to clean up the Gulf of Mexico oil spill are making it a smaller company, less able to sponsor such large experiments in the future.
Public unease about injections
Polls show a public uneasy about injecting CO2 into the ground. Earthquake-sensitive Californians "don't have a confidence level with anything that has to do with the subsurface in general," explained Elizabeth Burton, technical director of the West Coast Regional Carbon Sequestration Partnership, a group of 80 companies and state agencies trying to pave the way for HECA and other demonstration projects.
While it is still mostly on paper, HECA may still have the best shot at winning public support because it has financial support and its technology is the most conservative bet among large-scale projects being planned. Instead of burning its fuel, it will bake it at high temperatures to turn it into a gas, a process that has been known since World War II. The gas will then be treated with steam to produce carbon dioxide and hydrogen. The hydrogen will be burned in HECA's electric plant, providing "decarbonized" power to 150,000 homes.
The separated CO2 will be sent via pipeline to Elk Hills, where Occidental's payments for it will help reduce the project's costs. Occidental has been using CO2 for what is called "enhanced oil recovery" projects in Texas since the 1970s. "Natural gas and oil fields have held the oil and gas for millions of years," explained Barrett of Occidental. "They are basically good places to store things. We know all the characteristics of the reservoir."
Speaking at a recent symposium on carbon capture and storage projects in Sacramento, Sally Benson, a climate and energy expert at Stanford University, said that while much of the debate in California has been around converting its energy system to forms of renewable energy, such as solar and wind power, that is not likely to happen by 2050.
While environmental groups have sold California voters on renewable energy and have successfully led campaigns against coal-burning power plants and new nuclear plants, basic engineering is still needed to make the all-renewable dream happen. Benson noted that advances in batteries and other energy storage systems are needed to make solar and wind power available and reliable on a 24-hour-a-day basis.
"With no change in the future, 80 percent of our energy will continue to come from fossil fuel," she explained.
But she thinks that CCS -- which is usually thought of as a technology that is applied only to coal-burning power plants -- might bring California to its long-term emission-cutting goals. Benson explained that it would have to be applied to emissions of gas-fired power plants, cement plants, oil refineries and others among the state's biggest emitters before it could dramatically shrink the state's C02 footprint by 2050.
Moreover, while California has a limited number of oil and gas reservoirs, it has more than 1,000 years of potential carbon storage in deep underground saline aquifers in its Central Valley. Benson thinks public qualms about injecting CO2 deep underground can be overcome.
Environmental groups split
George Peridas, who has been pushing California's interest in decarbonization efforts for the Natural Resources Defense Council, explained at the symposium that the state's powerful environmental groups are split on the issue of CCS. Some worry that the technology will detract from further efforts to promote renewable energy; others are mainly focused on fighting the coal industry.
He agrees with Benson that if California is going to succeed in taking most of the carbon out of its energy system, CCS technology will be needed. "Pioneer projects like HECA are very important," he said in an interview. "Although this isn't one of our favorite climate solutions, it is one of those that is needed. It helps move the ball forward in getting CCS deployed."
Peridas is concerned that while California is leading the nation by imposing a cap on carbon emissions, it has fallen behind other states and the federal governments in drafting regulations for carbon capture and storage. In theory, a plant such as HECA should get benefits under a cap-and-trade system, if it has lower emissions than a natural gas-fired power plant. "They might get excess credits to sell, but the framework for this has yet to be worked out."
Mark Brownstein, deputy director of energy programs for the Environmental Defense Fund, agreed. He said the "simple fact is that it [coal] is going to be with us for quite a while. Phasing out of coal may take 50 to 100 years to do."
An effort by the state Legislature to establish a legal framework for CCS fizzled two years ago over concerns that CO2 injected into the ground may escape with lethal consequences. Currently, the California Energy Commission has appointed a blue-ribbon panel to study the issue.
S. Julio Friedmann, leader of a team of scientists studying the CCS issue at Lawrence Livermore National Laboratory, says most of the discussion around the supposed lethality of CO2 centers around a volcanic eruption that caused a massive bubble of the gas to erupt from Lake Nyos, a crater lake in the African nation of Cameroon in August 1986. Although 1,700 people suffocated, Friedmann said the massive eruption is peculiar only to volcanoes.
Costs remain uncertain
"These are strongly non-analogous things," he explained at the CCS symposium. Potential leaks from CCS storage sites would happen much more slowly and would be, by comparison, relatively tiny. "Science strongly supports that we can do CCS," he added. "We know enough to site a plant, monitor it and close it effectively. Hazards are there, but they are well-defined, and the risks appear to be small and manageable."
In future years, California laws on imports of coal-fired electric power from other states are expected to tighten. Current law says the carbon emissions associated with new imported power contracts must match those of gas-fired plants, which emit about 50 percent less carbon than coal plants.
That means that the HECA facility, which is being designed to use coal and to produce about a third of the carbon emitted from a natural gas plant, could be a way for California to expand energy jobs and lower its emissions and energy imports at the same time. According to Jeffrey Hopkins, a spokesman for Rio Tinto, that is part of the business plan.
"The objective for Rio Tinto is to demonstrate a technology that allows using solid fuels such as coal in a decarbonized world," he explained. The mining company, he said, has called for a cap on carbon emissions since 1998. "It is a way to preserve coal as a viable commodity that we're heavily invested in. That's important. We're consumers of electricity, so diversifying fuels can help reduce costs."
Just what the electricity from HECA will cost is like many other elements of the "decarbonized world" taking shape in California. Like the CO2 pollution it is intended to lessen, it is still up in the air.
Jordan Feilders, a spokesman for the project, said it is having "early commercial discussions" with utilities that might want to buy the electricity. HECA is having another set of discussions with the California Public Utilities Commission to see what prices it might be allowed to charge.
Tomorrow: "Green cement."