S. HRG. 110–265 CLEAN COAL, OIL AND GAS DEVELOPMENT, NEW ENERGY OPPORTUNITIES THROUGH CARBON CAPTURE AND STORAGE HEARING BEFORE A SUBCOMMITTEE OF THE COMMITTEE ON APPROPRIATIONS UNITED STATES SENATE ONE HUNDRED TENTH CONGRESS FIRST SESSION SPECIAL HEARING AUGUST 13, 2007—BISMARCK, ND Printed for the use of the Committee on Appropriations ( Available via the World Wide Web: http://www.gpoaccess.gov/congress/index.html U.S. GOVERNMENT PRINTING OFFICE 38–423 PDF WASHINGTON : 2008 For sale by the Superintendent of Documents, U.S. Government Printing Office Internet: bookstore.gpo.gov Phone: toll free (866) 512–1800; DC area (202) 512–1800 Fax: (202) 512–2104 Mail: Stop IDCC, Washington, DC 20402–0001 COMMITTEE ON APPROPRIATIONS ROBERT C. BYRD, West Virginia, Chairman DANIEL K. INOUYE, Hawaii THAD COCHRAN, Mississippi PATRICK J. LEAHY, Vermont TED STEVENS, Alaska TOM HARKIN, Iowa ARLEN SPECTER, Pennsylvania BARBARA A. MIKULSKI, Maryland PETE V. DOMENICI, New Mexico HERB KOHL, Wisconsin CHRISTOPHER S. BOND, Missouri PATTY MURRAY, Washington MITCH MCCONNELL, Kentucky BYRON L. DORGAN, North Dakota RICHARD C. SHELBY, Alabama DIANNE FEINSTEIN, California JUDD GREGG, New Hampshire RICHARD J. DURBIN, Illinois ROBERT F. BENNETT, Utah TIM JOHNSON, South Dakota LARRY CRAIG, Idaho MARY L. LANDRIEU, Louisiana KAY BAILEY HUTCHISON, Texas JACK REED, Rhode Island SAM BROWNBACK, Kansas FRANK R. LAUTENBERG, New Jersey WAYNE ALLARD, Colorado BEN NELSON, Nebraska LEMAR ALEXANDER, Tennessee CHARLES KIEFFER, Staff Director BRUCE EVANS, Minority Staff Director SUBCOMMITTEE ON ENERGY AND WATER DEVELOPMENT BYRON L. DORGAN, North Dakota, Chairman ROBERT C. BYRD, West Virginia PETE V. DOMENICI, New Mexico PATTY MURRAY, Washington THAD COCHRAN, Mississippi DIANNE FEINSTEIN, California MITCH MCCONNELL, Kentucky TIM JOHNSON, South Dakota ROBERT F. BENNETT, Utah MARY L. LANDRIEU, Louisiana LARRY CRAIG, Idaho DANIEL K. INOUYE, Hawaii CHRISTOPHER S. BOND, Missouri JACK REED, Rhode Island KAY BAILEY HUTCHISON, Texas FRANK R. LAUTENBERG, New Jersey WAYNE ALLARD, Colorado Professional Staff DOUG CLAPP ROGER COCKRELL FRANZ WUERFMANNSDOBLER SCOTT O’MALIA (Minority) BRAD FULLER (Minority) Administrative Support ROBERT RICH (II) CONTENTS Page Opening Statement of Senator Byron L. Dorgan .................................................. 1 Statement of Carl O. Bauer, Director, National Energy Technology Labora- tory, Department of Energy ................................................................................ 4 Prepared Statement ......................................................................................... 5 How is DOE Responding to These Issues? ............................................................ 6 Opportunities for Synergy Between Coal and Oil Industries .............................. 7 Statement of Ronald R. Harper, Chief Executive Officer and General Man- ager, Basin Electric Power Cooperative ............................................................. 16 Prepared Statement ......................................................................................... 17 A Comprehensive Solution to a Complex Problem ............................................... 18 Coal—a Necessary Part of the Solution ................................................................. 18 An Example for the Future—the Great Plains Synfuels Plant ........................... 18 Two Paths Forward for Coal ................................................................................... 19 Technology Horserace—a Balanced Approach to Incentives ................................ 19 Enhanced Oil Recovery—a Bridge for Technology ................................................ 20 Statement of John Weeda, Plant Manager, Coal Creek Station, Great River Energy ................................................................................................................... 20 Prepared Statement ......................................................................................... 22 Statement of Rod Nelson, Vice President, Schlumberger Limited on Behalf of the National Petroleum Council ..................................................................... 23 Prepared Statement ......................................................................................... 25 NPC Report Findings and Background ................................................................. 25 Carbon Capture and Sequestration ........................................................................ 27 Statement of Jeffrey N. Phillips, Program Manager, Electric Power Research Institute ................................................................................................................ 30 Prepared Statement ......................................................................................... 32 Summary of Key Points .......................................................................................... 33 Accelerating RD&D on Advanced Coal Technologies with CO2 Capture and Storage—Investment and Time Requirements .................................................. 33 Reducing CO2 Emissions Through Improved Coal Power Plant Efficiency ........ 35 New Plant Efficiency Improvements—IGCC ......................................................... 36 New Plant Efficiency Improvements—Advanced Pulverized Coal ...................... 40 Improving CO2 Capture Technologies .................................................................... 44 Pre-combustion CO2 Capture (IGCC) ..................................................................... 44 Post-combustion CO2 Capture (PC and CFB Plants) ........................................... 45 Oxy-fuel Combustion Boilers .................................................................................. 46 CO2 Transport and Geologic Storage ..................................................................... 46 CCS in the United States ........................................................................................ 47 CO2 Transportation ................................................................................................. 49 Policy-related Long-term CO2 Storage Issues ....................................................... 49 Long-term CO2 Storage Liability Issues ................................................................ 49 RD&D Investment for Advanced Coal and CCS Technologies ............................ 49 Prepared Statement of Dr. Gerald H. Groenewold, Director, Energy & Envi- ronmental Research Center, University of North Dakota ................................ 62 (III) CLEAN COAL, OIL AND GAS DEVELOPMENT, NEW ENERGY OPPORTUNITIES THROUGH CARBON CAPTURE AND STORAGE MONDAY, AUGUST 13, 2007 U.S. SENATE, SUBCOMMITTEE ON ENERGY AND WATER DEVELOPMENT, COMMITTEE ON APPROPRIATIONS, Bismarck, ND. The subcommittee met at 9:38 a.m., in the Pioneer Room, State Capitol Building, Hon. Byron L. Dorgan (chairman) presiding. Present: Senator Dorgan. OPENING STATEMENT OF SENATOR BYRON L. DORGAN Senator DORGAN. I call the hearing to order. This is a hearing of the Senate Energy and Water Development Appropriations Sub- committee. The hearing subject is clean coal, oil and gas develop- ment and new energy opportunities through carbon capture and storage. I’m Byron Dorgan, chairman of this Appropriations sub- committee. The ranking member is Senator Domenici from New Mexico, who is not able to be with us today, but I’m pleased that Franz Wuerfmannsdobler is here. Franz is a principal staffer on our Energy and Water Subcommittee dealing principally with en- ergy issues. I want to thank all of you for coming. This is a very interesting subject, and I want to make just a couple of comments as we begin and then I will call on a number of witnesses. We’re talking a lot about energy independence these days be- cause we are, in my judgment, dangerously dependent on foreign sources of oil. Sixty percent of our oil comes from outside of our country, much from troubled parts of the world. If, God forbid, something should interrupt the oil pipeline tomorrow morning from Saudi Arabia, Venezuela, Iraq, or you name it, our economy, our country, would be in very serious trouble. And because we are dan- gerously dependent on foreign sources of oil, we’re talking about how we become less dependent and, therefore, identify the domestic resources we can use to become less dependent. We have abundant resources of fossil fuels, coal, oil, and natural gas. We have substantial opportunities in renewable fuels and we’re going to do much more in all of these areas. There’s a lot of talk about renewable fuels, and we know that we’re doing a lot on wind energy in North Dakota, which I’ve supported for a long while. We’re seeing ethanol plants being developed and biomass as (1) 2 well; we’re seeing a lot of new things happening in the renewable fuels area. But this should not suggest that we are not going to use our fos- sil fuels. We are. I don’t think anyone believes that somehow in a short, intermediate or long term that we’re not going to continue to use fossil fuels. The question isn’t ‘‘whether.’’ The question is under what conditions we use them. And I say that because these days things have changed with re- spect to those calculations. Now you can’t discuss these issues with- out discussing climate change in the same breath. We’ve come to an intersection where the issue of climate change relating to en- ergy production and the use of energy is a significant part of many future policy discussions, and so we’ll be talking about that today.