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Towns hope to host coal plant

Sat., Dec. 1, 2007

TUSCOLA, Ill. – Brian Moody stands beside a just-plowed corn field on the edge of town, sinking his brown, leather lace-ups into what he hopes is the future.

It’s not much to look at.

But Moody, president of Tuscola Economic Development Inc., has pitched this parcel of flat, black prairie as the ideal site for a power plant that developers say would emit almost no pollution, turning coal into gas while capturing and storing climate-changing carbon dioxide deep underground.

Much is riding on the experimental $1.5 billion plant, dubbed FutureGen, whose location is expected to be announced after Dec. 17 by a development alliance that includes the U.S. Department of Energy and a not-for-profit consortium of private-sector coal and energy companies, including Peabody Energy Corp., American Electric Power Service Corp., Foundation Coal Corp. and Anglo American Services Ltd.

Advocates say the venture could revolutionize energy production, providing a healthier alternative to the pollution-belching coal plants of old while boosting the market for U.S. coal.

But for the four small, rural towns vying for the plant – Tuscola and Mattoon, Ill., and Jewett and Penwell, Texas – the stakes also are high. FutureGen promises jobs – 1,300 while the plant is being built, and 150 high-skilled permanent positions.

Moody is also bidding for pride and a chance to play a role in an energy revolution.

“It gives Tuscola a chance to be first in the world in something,” he said, laying out a vision that includes thousands of people from around the world visiting the town of 4,400 – notable for its Victorian houses and brick-lined streets – to see how the plant works.

Besides developers’ claims that it could practically eliminate greenhouse gas emissions, the FutureGen Alliance has labeled the project cutting-edge, both for the technology’s promise of stripping hydrogen from coal, then using that gas to power turbines to produce electricity and, perhaps down the line, for fuel cells in hydrogen-powered vehicles.

In Illinois’ coal belt, FutureGen also promises to help revive another old industry: coal.

Almost 18,000 people worked in the state’s coal mines in 1983, a figure that dropped to less than 3,500 in 2000 as pollution restrictions limited the use of the high-sulfur local coal.

The competition has been fierce.

Illinois offered $80 million in grants, low-interest loans and tax breaks, while Texas has promised $260 million in cash and tax credits. Both have offered developers protection from liability in the event that carbon dioxide leaks from the ground.

Economists say the project is an attractive economic target for small towns, and a big improvement on the kinds of low-wage jobs they tend to chase.

“Everyone talks about kind of the big score of attracting a Honda plant,” University of Illinois economics professor Fred Giertz said in an interview earlier this year. “The way the economy actually works is hundreds of thousands of small gains and small losses.”

The central Illinois towns have lived through lean times, losing local coal mines to pollution concerns and local industry to the Rust Belt exodus of the 1970s and ‘80s. And the Texas sites know the boom-and-bust nature of the petroleum business.

In Jewett, a town of about 860 in the thickly wooded cattle country about 135 miles northwest of Houston, “Welcome FutureGen” banners have been up for more than a year.

A strip mine, a steel plant and a power plant employ at total of about 1,000 people. But longtime resident Ollie Foley said she’d welcome another solid economic anchor.

“It’s good for our economy around here, our housing, our schools, the community itself,” the 66-year-old former Jewett Area Chamber of Commerce employee said.

Penwell, a former oil boomtown that now has fewer than 100 residents, is a few miles down Interstate 20 from Odessa, a modern oil boomtown of about 90,000 in the wide-open Permian Basin.

“You can stand on a brick and see 50 miles,” said Neil McDonald Jr., director of economic development for the Odessa Chamber of Commerce.

One Odessa resident said high oil prices have the region’s economy on an upswing, but diversifying is wise.

“It seems like a perfect location,” Liz Faught said. “And who knows when the price of oil will go down again? I think it’s wonderful to have new industry.”

Back in Mattoon, Ill., there’s an uneasiness among some that – despite developers’ insistence to the contrary – the cards might be stacked against Illinois because President Bush is a Texan with old ties to west Texas oil, and the decision on the plant will be made in Washington.

“If it’s based on science, it’ll be in Illinois,” Mattoon city administrator Alan Gilmore said. “If it’s based on money, it’ll be in Texas.”

Little distinguishes any of the towns from the others. All are in relatively flat country – which is easier to build on – and FutureGen’s developers have said all have the right geology for underground carbon dioxide storage.

Some studies suggest the Illinois locations have a slight advantage – the local bedrock hasn’t been drilled through nearly as many times as the rock below the Texas locations, so the probability of carbon dioxide escaping is lower.

Texans say some of the infrastructure needed for a plant already is in place.

Regardless of whether it lands the FutureGen plant, Mattoon is already looking to the future.

“We have a handful of projects that we’re working on now that are alternative energy,” said Angela Griffin, president of Coles Together, the Coles County economic development agency.

Mattoon, a town of about 18,000, still is a manufacturing center, and one of the biggest local employers is a Lender’s bagel plant.

But Griffin said the town learned hard lessons watching many manufacturers leave in search of cheaper labor.

“We have a lot of support from people who are ready to move the community forward,” she said, “and leave that sort of emptying manufacturing plants behind.”


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