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88–659 2014

DEPARTMENT OF ENERGY OVERSIGHT: STATUS 

OF CLEAN COAL PROGRAMS 

HEARING 

BEFORE THE

SUBCOMMITTEE ON OVERSIGHT AND 

INVESTIGATIONS 

OF THE

COMMITTEE ON ENERGY AND 

COMMERCE 

HOUSE OF REPRESENTATIVES 

ONE HUNDRED THIRTEENTH CONGRESS 

SECOND SESSION 

FEBRUARY 11, 2014 

Serial No. 113–118 

( 

Printed for the use of the Committee on Energy and Commerce 

energycommerce.house.gov 

(II) 

COMMITTEE ON ENERGY AND COMMERCE 

FRED UPTON, Michigan 

Chairman 

RALPH M. HALL, Texas 

JOE BARTON, Texas 

Chairman Emeritus 

ED WHITFIELD, Kentucky 

JOHN SHIMKUS, Illinois 

JOSEPH R. PITTS, Pennsylvania 

GREG WALDEN, Oregon 

LEE TERRY, Nebraska 

MIKE ROGERS, Michigan 

TIM MURPHY, Pennsylvania 

MICHAEL C. BURGESS, Texas 

MARSHA BLACKBURN, Tennessee 

Vice Chairman 

PHIL GINGREY, Georgia 

STEVE SCALISE, Louisiana 

ROBERT E. LATTA, Ohio 

CATHY MCMORRIS RODGERS, Washington 

GREGG HARPER, Mississippi 

LEONARD LANCE, New Jersey 

BILL CASSIDY, Louisiana 

BRETT GUTHRIE, Kentucky 

PETE OLSON, Texas 

DAVID B. MCKINLEY, West Virginia 

CORY GARDNER, Colorado 

MIKE POMPEO, Kansas 

ADAM KINZINGER, Illinois 

H. MORGAN GRIFFITH, Virginia 

GUS M. BILIRAKIS, Florida 

BILL JOHNSON, Missouri 

BILLY LONG, Missouri 

RENEE L. ELLMERS, North Carolina 

HENRY A. WAXMAN, California 

Ranking Member 

JOHN D. DINGELL, Michigan 

Chairman Emeritus 

FRANK PALLONE, JR., New Jersey 

BOBBY L. RUSH, Illinois 

ANNA G. ESHOO, California 

ELIOT L. ENGEL, New York 

GENE GREEN, Texas 

DIANA DEGETTE, Colorado 

LOIS CAPPS, California 

MICHAEL F. DOYLE, Pennsylvania 

JANICE D. SCHAKOWSKY, Illinois 

JIM MATHESON, Utah 

G.K. BUTTERFIELD, North Carolina 

JOHN BARROW, Georgia 

DORIS O. MATSUI, California 

DONNA M. CHRISTENSEN, Virgin Islands 

KATHY CASTOR, Florida 

JOHN P. SARBANES, Maryland 

JERRY MCNERNEY, California 

BRUCE L. BRALEY, Iowa 

PETER WELCH, Vermont 

BEN RAY LUJAN, New Mexico 

PAUL TONKO, New York 

JOHN A. YARMUTH, Kentucky 

(III) 

SUBCOMMITTEE ON OVERSIGHT AND INVESTIGATIONS

TIM MURPHY, Pennsylvania 

Chairman 

MICHAEL C. BURGESS, Texas 

Vice Chairman 

MARSHA BLACKBURN, Tennessee 

PHIL GINGREY, Georgia 

STEVE SCALISE, Louisiana 

GREGG HARPER, Mississippi 

PETE OLSON, Texas 

CORY GARDNER, Colorado 

H. MORGAN GRIFFITH, Virginia 

BILL JOHNSON, Ohio 

BILLY LONG, Missouri 

RENEE L. ELLMERS, North Carolina 

JOE BARTON, Texas 

FRED UPTON, Michigan (ex officio) 

DIANA DEGETTE, Colorado 

Ranking Member 

BRUCE L. BRALEY, Iowa 

BEN RAY LUJAN, New Mexico 

JANICE D. SCHAKOWSKY, Illinois 

G.K. BUTTERFIELD, North Carolina 

KATHY CASTOR, Florida 

PETER WELCH, Vermont 

PAUL TONKO, New York 

JOHN A. YARMUTH, Kentucky 

GENE GREEN, Texas 

HENRY A. WAXMAN, California (ex officio) 

(V) 

C O N T E N T S 

Page 

Hon. Tim Murphy, a Representative in Congress from the Commonwealth 

of Pennsylvania, opening statement ................................................................... 1 

Prepared statement .......................................................................................... 3 

Hon. Janice D. Schakowsky, a Representative in Congress from the State 

of Illinois, opening statement .............................................................................. 4 

Hon. Michael C. Burgess, a Representative in Congress from the State of 

Texas, opening statement .................................................................................... 6 

Hon. Henry A. Waxman, a Representative in Congress from the State of 

California, opening statement ............................................................................. 7 

Hon. Fred Upton, a Representative in Congress from the state of Michigan, 

prepared statement .............................................................................................. 54 

Hon. G.K. Butterfield, a Representative in Congress from the State of North 

Carolina, prepared statement ............................................................................. 55 

WITNESSES

Julio Friedmann, Deputy Assistant Secretary for Clean Coal Department 

of Energy, Accompanied by Scott Klara, Acting Director for the National 

Energy Technology Laboratory, Department of Energy ................................... 9 

Prepared statement .......................................................................................... 12 

Answers to submitted questions ...................................................................... 61 

SUBMITTED MATERIAL

Majority memorandum ............................................................................................ 56 

(1) 

DEPARTMENT OF ENERGY OVERSIGHT: 

STATUS OF CLEAN COAL PROGRAMS 

TUESDAY, FEBRUARY 11, 2014 

HOUSE OF REPRESENTATIVES, 

SUBCOMMITTEE ON OVERSIGHT AND INVESTIGATIONS, 

COMMITTEE ON ENERGY AND COMMERCE, 

Washington, DC. 

The subcommittee met, pursuant to call, at 10:04 a.m., in room 

2123 of the Rayburn House Office Building, Hon. Tim Murphy 

(chairman of the subcommittee) presiding. 

Members present: Representatives Murphy, Burgess, Gingrey, 

Scalise, Harper, Olson, Gardner, Griffith, Johnson, Long, Ellmers, 

Barton, Schakowsky, Butterfield, Castor, Tonko, and Waxman (ex 

officio). 

Staff present: Charlotte Baker, Press Secretary; Karen Christian, 

Chief Counsel, Oversight; Carrie-Lee Early, Detailee, Oversight; 

Brad Grantz, Policy Coordinator, Oversight and Investigations; 

Brittany Havens, Legislative Clerk; Mary Neumayr, Senior Energy 

Counsel; Sam Spector, Counsel, Oversight; Peter Spencer, Professional Staff Member, Oversight; Tom Wilbur, Digital Media Advisor; Phil Barnett, Staff Director; Brian Cohen, Staff Director, Oversight and Investigations, and Senior Policy Advisor; Kiren Gopal, 

Counsel; Hannah Green, Staff Assistant; Bruce Ho, Counsel; Elizabeth Letter, Press Secretary; and Alexandra Teitz, Senior Counsel, 

Environment and Economy. 

OPENING STATEMENT OF HON. TIM MURPHY, A REPRESENTATIVE IN CONGRESS FROM THE COMMONWEALTH OF PENNSYLVANIA 

Mr. MURPHY. Good morning. Welcome to a hearing of the Energy 

and Commerce Committee, subcommittee on Oversight and Investigations, this hearing on Department of Energy Oversight, Status 

of Clean Coal Programs. Today’s hearing will review the status of 

these programs. This oversight, we have focused on the department’s efforts to advance carbon capture and sequestration or CCS 

technologies at coal-based power plants. 

Legislation and regulation in this important area should and 

must be based on sound scientific and economic facts. Where are 

we? Where are we going? When can we get there? And how do we 

do it? 

Today’s testimony, which builds on our oversight work from this 

past October when we heard from workers and local officials whose 

coal-dependent communities are suffering in part because of EPA 

2 

policies will help us review exactly where DOE is today in its work 

on CCS. 

There are many questions about the current status of this technology. We are sure our panelists today will be able to shed some 

light on this. Answering these questions and gathering the underlying facts will help us understand how carbon capture technologies 

can work effectively and reliably on coal-powered plants. This testimony will also help the committee develop a clear and accurate 

record of what will be necessary, the innovation and operational experience, economics, the timeframes to develop commercially competitive CCS for coal-based power generation. 

The technical and economic issues DOE confronts are not everything that is needed to determine if CCS can work at a large level 

in our nation’s electricity system. There are legal issues, regulatory 

issues, infrastructure issues. All must be addressed appropriately. 

Yet when looking at just the critical technical challenges to CCS 

or coal plants, challenges for which Congress has appropriated billions of dollars to DOE to address, we have a way to go on several 

levels. 

First, it has not yet been demonstrated that CCS systems will 

work reliably at full-scale coal power plants. It is not sufficient to 

rely upon paper estimates and laboratories or speculation from 

EPA lawyers about technological feasibility. Carbon dioxide capture 

and compression systems have to be integrated into actual, fullscale coal power plants and be shown to operate reliably over time 

while maintaining predictable and safe plant operations. It does 

not appear DOE will have complete answers about this for at least 

6 to 10 years, so we need an update. 

Second, the costs to produce electricity have come down by a 

large amount to make any successful demonstrated CCS systems 

commercially viable in open markets. The first generation CCS 

technology, because of increased capital and operating costs and decreased electricity produced, the electric grid has been estimated to 

increase the cost of electricity significantly. 

At a coal gasification facility, the cost of electricity may be increased by 40 percent, at a pulverized coal power plant by upwards 

of 80 percent. This is what DOE’s own document tells us. Demonstrating full scale CCS is alone not sufficient to make it the 

standard for the nation’s coal-based electricity generation. 

If coal power plants cost too much, nobody will build them. Energy costs will increase making it even more difficult for families 

and U.S. manufacturers to compete. 

Which brings me to the third point, the research development 

and innovative breakthroughs needed to produce economically viable CCS technologies for coal power will take operational experience and time, decades in fact. This is not my opinion. DOE’s own 

R&D timetables make this point to us. 

Over the past 10 fiscal years, more than $7.6 billion have been 

appropriated to DOE for its clean coal programs. This spending reflects the confidence Congress has placed in DOE and the National 

Energy Technology Laboratory, or NETL, to help advance these 

technologies. 

3 

Given the spending and given the current economic and regulatory landscape, oversight is necessary to ensure DOE’s stewardship of these funds and goals for its research are effective. 

It is also necessary to make sure energy and environmental policies match the technological realities. We are all committed to 

clean air, period. But moreover, we must be committed to using 

North American energy resources rather than continuing our trillion dollar trade deficit with OPEC or $4 trillion wars in the Mideast where we have to defend their oil fields. 

In this hearing, I hope we will get some straight answers so that 

we can establish what is truly the status and prospects of DOE’s 

game plan for advancing coal power technologies. Our two witnesses this morning should be up to the task, highly qualified. 

Dr. Friedmann presently heads DOE’s coal programs and has 

substantial experience working on energy projects at Lawrence 

Livermore National Laboratory, and Scott Klara, an authority on 

coal research from the National Energy Technology Laboratory understands the R&D challenges. 

We look forward to having you give us the plain facts, not Washington spin. At the end of the day, straight answers will help this 

committee determine whether DOE is up to the task of shepherding the innovation that may dramatically advance coal-based 

power both in terms of efficiency and environmental goals. 

But I worry that in the rush by the administration to implement 

new standards and regulations on coal-based power generation, the 

prospects for success or technological advancements are at risk. All 

these are questions we hope you can address today. 

[The prepared statement of Mr. Murphy follows:] 

PREPARED STATEMENT OF HON. TIM MURPHY

Today’s hearing will review the status of the Department of Energy’s clean coal 

programs. This oversight will be focused on the department’s efforts to advance carbon capture and sequestration, or CCS, technologies at coal-based power plants. 

Legislation and regulation in this important area should and must be based on 

sound scientific and economic facts. Where are we? Where are we going? When can 

we get there? How do we do it? 

Today’s testimony, which builds on our oversight work from this past October 

when we heard from workers and local officials whose coal-dependent communities 

are suffering in part because of EPA policies—will help us review exactly where 

DOE is today in its work on CCS. There are many questions about the current status of this technology. Answering these questions, and gathering the underlying 

facts, will help us understand how carbon capture technologies can work effectively 

and reliably on coal power plants. The testimony will also help the committee develop a clear and accurate record of what will be necessary—the innovation, the 

operational experience, the economics, the timeframes—to develop commercially 

competitive CCS for coal-based power generation. 

The technical and economic issues DOE confronts are not everything that is needed to determine if CCS can work at a large level in our nation’s electricity system. 

Various legal issues, regulatory issues, infrastructure issues all must be addressed 

appropriately. 

Yet when looking at just the critical technical challenges to CCS for coal plants— 

challenges for which Congress has appropriated billions of dollars to DOE to address—we have a way to go, on several levels. 

First, it has not yet been demonstrated that CCS systems will work reliably at 

full-scale coal power plants. It is not sufficient to rely upon paper estimates in laboratories or speculation from EPA lawyers about technological feasibility. 

Carbon dioxide capture and compression systems have to be integrated into actual, full-scale coal power plants and be shown to operate reliably over time, while 

4 

maintaining predictable and safe plant operations. And it does not appear DOE will 

have complete answers about this for at least 6 to 10 years. 

Second, the costs to produce electricity have to come down by a large amount to 

make any successfully demonstrated CCS systems commercially viable in the open 

market. The first generation CCS technology—because of increased capital and operating costs and decreased electricity produced for the electric grid—has been estimated to increase the cost of electricity significantly. At a coal gasification facility, 

the cost of electricity may be increased by 40 percent; at a pulverized coal power 

plant, by upwards of 80 percent. This is what DOE’s own documents tell us. 

Demonstrating full scale CCS is alone not sufficient to make it the standard for 

the nation’s coal based electricity generation. If coal power plants cost too much, nobody will build them. 

Energy costs will increase making it even more difficult for families and US manufacturers to compete. 

Which brings me to the third point: the research, development, and innovative 

breakthroughs needed to produce economically viable CCS technologies for coal 

power will take operational experience and time, decades in fact. This is not my 

opinion; DOE’s own R&D timetables make this point. 

Over the past 10 fiscal years, more than $7.6 billion have been appropriated to 

DOE for its clean coal programs. This spending reflects the confidence Congress has 

placed in DOE and the National Energy Technology Laboratory, or NETL, to help 

advance these technologies. 

Given this spending, and given the current economic and regulatory landscape, 

oversight is necessary to ensure DOE’s stewardship of these funds and goals for its 

research are effective. It is also necessary to make sure energy and environmental 

policies match the technological realities. We are all committed to clean air. Period. 

But moreover, we must be committed to using North American energy resources 

rather than continuing our trillion-dollar trade deficit with OPEC, or our $4 trillion 

wards in the Mid East where we have to defend their oil fields. 

In this hearing, I hope we will get some straight answers so that we can establish 

what is truly the status and prospects of DOE’s game-plan for advancing coal power 

technologies. Our two witnesses this morning should be up to the task. Dr. Friedman presently heads DOE’s coal programs and has substantial experience working 

on energy projects at Lawrence Livermore National Laboratory. And Scott Klara, an 

authority on coal research from the National Energy Technology Laboratory, understands the R&D challenges. I look to you to give us the plain facts, not Washington 

double-talk. 

At the end of the day, straight answers will help this committee determine whether DOE is up to the task of shepherding the innovation that may dramatically advance coal based power, both in terms of efficiency and environmental goals. But 

I worry that in the rush by this administration to implement new standards and 

regulations on coal based power generation, the prospects for successful technological advancement are at risk. 

# # # 

Mr. MURPHY. And with that, I will now recognize Ms. 

Schakowsky, who is sitting in for Ms. DeGette for 5 minutes. 

OPENING STATEMENT OF HON. JANICE D. SCHAKOWSKY, A 

REPRESENTATIVE IN CONGRESS FROM THE STATE OF ILLINOIS 

Ms. SCHAKOWSKY. Thank you, Mr. Chairman. I appreciate our 

witnesses appearing today to tell us about the progress of DOE’s 

important carbon capture and storage research development and 

demonstration work. I often say that this Congress has an opportunity to lead this country into the future with smart action that 

will curb emissions and prevent irreversible climate change, but 

our window to take action is rapidly closing. 

We know that the National Oceanic and Atmospheric Administration announced that 2013 was the fourth warmest year on 

record, and 9 of the 10 warmest years have occurred since 2000. 

For decades, the world’s scientists have presented policy makers 

with evidence that climate change is happening and that human 

5 

activities are responsible. Those warnings have only grown stronger with time. 

The president of the National Academy of Sciences has explained 

that scientists are now as certain about human-caused climate 

change as they are that smoking cigarettes can cause cancer. We 

need to drastically reduce our carbon emissions and quickly. We 

need to make a commitment to clean and renewable sources that 

provide all of the jobs and energy benefits of fossil fuels without 

the public health and environmental costs. 

We also need to use the best technology available to reduce carbon emissions wherever we can. Carbon capture and storage or 

CCS is one of those technologies. CCS investments are proving that 

coal-fired power plants can capture a significant percentage of their 

carbon pollution and safely transport and inject it underground. 

The Kemper facility in Mississippi set to go online later this year 

will be the first commercial scale coal-fired CCS project, but it is 

not the only one. There are projects in California, Texas, and elsewhere including my home state of Illinois that have attracted billions of dollars in private financing. Those projects are demonstrating all the individual elements of advanced CCS systems, 

carbon capture, compression, transport, and sequestration technologies. 

In September, EPA proposed a rule requiring new coal-fired 

power plants to cut carbon pollution. To meet the proposed standards, new coal plants will have to use CCS technology to capture 

a portion of their carbon pollution. Opponents have argued that the 

EPA should not have a role in reducing carbon pollution from coalfired plants and that CCS technology isn’t available now. 

In fact, this committee passed a bill just last week essentially 

eliminating EPA’s authority to regulate carbon pollution from coal 

plants. 

Today’s hearing should provide some much needed facts about 

CCS and the economics of pollution controls. First there is a critical 

role for government to play. Right now, power plants can pollute 

without any adverse financial impact. There is no financial incentive for industry to develop and deploy pollution controls on a widespread basis. 

If EPA doesn’t require responsible action, we have no chance of 

protecting public health and our planet over the long term. It is 

also important to recognize that CCS technologies are already 

available. All the component pieces of CCS have been used in industrial applications for a long time. Industrial facilities have separated carbon dioxide for several decades. Oil companies have transported carbon dioxide by pipeline and injected it underground for 

nearly 40 years. 

Existing DOE programs have helped apply those technologies in 

the power sector. Multiple demonstration projects have applied 

these technologies to coal plants. Several full-scale projects are 

under construction today, and many vendors are willing to sell CCS 

technologies right now. 

CCS is the only proven set of technologies that would allow us 

to cut carbon pollution while still using coal. I look forward to hearing from our DOE witnesses today about their important contributions to our nation’s vital effort to cut carbon pollution. And I don’t 

6 

know if anyone would like the remaining time. I yield back. Thank 

you, Mr. Chairman. 

Mr. MURPHY. Gentlelady yields back, and I now recognize Dr. 

Burgess for 5 minutes. 

OPENING STATEMENT OF HON. MICHAEL C. BURGESS, A 

REPRESENTATIVE IN CONGRESS FROM THE STATE OF TEXAS 

Mr. BURGESS. Well, thank you, Mr. Chairman, and this hearing 

is the perfect example of our constitutional obligation, the constitutional obligation that is required of this subcommittee. On behalf 

of the taxpayers of this country, we are required to do oversight. 

We are required to ask the questions and get the answers. Our 

committee authorizes the expenditure of money. The appropriators 

write the check. The agency cashes the check, and it is our obligation to ensure that that money has been spent appropriately for the 

benefit of the taxpayer of this country. 

Every program, every agency, should come under similar scrutiny. This is not partisan. It is not political. It is basic oversight 

and applying common sense principles to allow the government the 

opportunity to work more effectively and efficiently on behalf of the 

taxpayer. 

So for over a decade, the Department of Energy has been focused 

on assisting industry to develop ways to reduce carbon dioxide 

emissions, most notably although not exclusively, through the carbon capture and storage techniques. Research and development for 

these technologies has cost the federal government billions of dollars. 

So what did we get for the money we spent? Where does this 

technology stand? Are we nearing commercial viability? And if so, 

what is the timeline for your average generating plant to be able 

to acquire such technology? 

In Texas, many questions remain as to how carbon capture and 

storage will affect neighborhoods and the environment around generation plants. When pressurized carbon is injected deep into the 

earth, how does that affect the ground above? Are people’s homes 

and businesses at risk from seismic activity should this carbon accidentally be released? Will the earth’s surface around such sequestration attempts be changed due to the injection of emissions? The 

federal government must be honest and must be up front with the 

American people as to the potential pitfalls as well as the benefits 

to such technology. 

So over $7.5 billion has been appropriated over the last decade 

for the development of clean coal’s technologies. We must have an 

accounting of every dollar and how the American taxpayer is better 

off by each dollar having been spent. Where has the money gone? 

What do we have to show for it? I hope these questions can be answered during today’s hearing. 

With eight demonstration projects of carbon capture and storage 

technology beginning around the country, two in my home State of 

Texas, how many are close to actual operation? How many are producing electricity that consumers can use today? And if they are 

producing electricity that consumers can use today, what effect has 

that had on the price for the consumer? 

7 

A lot is riding on this. The federal agency is setting regulations 

and standards based upon these demonstration projects. We need 

to know where they stand. So today’s hearing is the kind of oversight this committee can do and should do. It is the kind of oversight that we do best. Asking questions as to how the authorizations passed by this committee are being utilized by the department and how the money the department received is being spent 

and ultimately how that benefits the taxpayer. 

I thank the chairman for the recognition. I will yield back the 

time. 

Mr. MURPHY. Gentleman yields back. Now recognize Mr. Waxman for 5 minutes. 

OPENING STATEMENT OF HON. HENRY A. WAXMAN, A REPRESENTATIVE IN CONGRESS FROM THE STATE OF CALIFORNIA 

Mr. WAXMAN. Thank you very much, Mr. Chairman. The subject 

of today’s hearing is one that is vital for the future of coal and the 

climate, the development of carbon capture and storage, or CCS 

technologies. Investments that the Department of Energy is making in CCS will help industry produce cleaner power, help provide 

a market for coal as the world moves to cut carbon pollution, and 

help avoid a catastrophic degree of climate change. 

There is a long history of government investment driving private 

sector technological advances. Government investment led to the 

creation of the Internet, GPS positioning, and even Apple’s voice 

assistant Siri. Google’s Search algorithm was financed by a grant 

from the National Science Foundation. 

In the case of CCS, DOE is partnering with the coal industry and 

utilities to build next generation clean coal power plants, helping 

to create new jobs and control carbon emissions. Investing in CCS 

makes sense because our nation and the world must reduce our 

carbon emissions. 

My Republican colleagues accuse the president of waging a war 

on coal. In fact, the president is trying to create a future for coal. 

His administration has invested billions of dollars, more than any 

other administration, to develop clean coal technologies. It is the 

policies pursued by Republicans on this committee, not the president’s policies, that are a real threat to coal. 

In fact, I am confident that the coal industry and Republican 

members from coal states will soon regret the day that they opposed the Waxman-Markey Climate Bill and the $60 billion we proposed to invest in carbon capture and sequestration. 

Mr. Chairman, this committee is powerful. We have the authority to shape our Nation’s environmental and energy laws. But there 

is one set of laws we cannot change. Those are the laws of nature. 

The greenhouse effect tells us that we will irrevocably change our 

atmosphere and cause catastrophic climate change if we continue 

to burn coal without developing a technology to capture its carbon 

emissions. That is not a bright future for coal or any of us. 

The DOE investments in CCS are under the spotlight now because of EPA’s proposed new power plant rule, but these investments are crucially important and are starting to pay off. Later 

this year, Southern Company’s Kemper County Energy Facility in 

8 

Mississippi will begin operations and capture 67 percent of its CO2

emissions. DOE’s $270 million investment helped to make this 

plant a reality and attracted billions of dollars in private financing. 

Opponents of CCS say that technology used in Kemper’s facility 

is too expensive. But the cost of virtually all new technologies decrease over time with experience, continued innovation, and economies of scale. 

We have seen that repeatedly under the Clean Air Act with 

scrubbers, NOx controls, and mercury controls. The expert witnesses today will tell us that they expect to see similar cost reductions with CCS technology. 

In contrast, the costs of climate disruption are only going to get 

worse, much worse, if we don’t act now to cut carbon pollution. Our 

choice is a simple one. We can do nothing while coal plants continue to spew dangerous emissions into the air, endangering the 

welfare of our children and our planet. Or we can develop the new 

clean energy technologies of the future. The President and DOE 

Secretary Moniz have made the right choice, invest in CCS. Our 

choice should be to support them in this effort. Mr. Chairman, yield 

back my time. 

Mr. MURPHY. Gentleman yields back. I would like to now introduce our panel today. Dr. Julio Friedmann is the Deputy Assistant 

Secretary for Clean Coal, Office of Fossil Energy at the Department 

of Energy. In this capacity, he is responsible for the DOE’s research 

and development programs and advance of fossil energy systems, 

large demonstration projects, carbon capture utilization and storage, and clean coal deployment. Before assuming his current position, Friedmann was Chief Energy Technologist for Lawrence 

Livermore National Laboratory. 

Scott Klara is accompanying Dr. Friedmann today, and he is currently the acting director of the Department of Energy’s National 

Energy Technology Laboratory where he is responsible for managing the day-to-day execution of all aspects of the lab’s mission. 

He has 22 years of federal government experience with NETL and 

its predecessor organizations. 

I will now swear in the witnesses. You are aware the committee 

is holding an investigative hearing and when doing so, has the 

practice of taking testimony under oath. Do you have any objections to testifying under oath? Both witnesses say no, and the 

Chair then advises you that under the rules of the House and rules 

of the committee, you are entitled to be advised by counsel. Do you 

desire to be advised by counsel during testimony today? Both waive 

that. 

In that case, if you will please rise and raise your right hand, 

I will swear you in. 

[Witnesses sworn.] 

Mr. MURPHY. Both witnesses answer in the affirmative, so you 

are now under oath and subject to the penalties set forth in Title 

18, Section 1001 of the United States Code. You may now each give 

a 5-minute opening statement. Dr. Friedmann, we will begin with 

you. 

9 

TESTIMONY OF JULIO FRIEDMANN, DEPUTY ASSISTANT SECRETARY FOR CLEAN COAL DEPARTMENT OF ENERGY, ACCOMPANIED BY SCOTT KLARA, ACTING DIRECTOR FOR THE 

NATIONAL ENERGY TECHNOLOGY LABORATORY, DEPARTMENT OF ENERGY 

Mr. FRIEDMANN. Thank you, Chairman Murphy, Ranking Member Schakowsky, Ranking Member Waxman, and other members of 

the subcommittee. Thank you for this opportunity to speak to you 

today. It is really an honor and a privilege. 

By way of introduction, I am the only Julio Friedmann you will 

ever meet and was recently appointed to be the Deputy Assistant 

Secretary for Clean Coal in the Office of Fossil Energy. This is my 

second time testifying before this committee, my first time in this 

role. 

Prior to that appointment, I served as the Chief Energy Technologist at Lawrence Livermore National Laboratory where I coordinated and managed energy research programs across laboratory. I have also worked in industry, 5 years at Exxon Mobil in 

Houston and in academia as part of the faculty of the University 

of Maryland. 

I am joined today by Mr. Scott Klara. He is the acting director 

of our National Energy Technology Laboratory, the only government-owned, government-operated laboratory with the sole mission 

on fossil energy. Mr. Klara is responsible for the execution and 

management of the program work here where he served the Nation 

for over 20 years following a 7-year stint in industry. 

We appreciate this opportunity to discuss the Department of Energy’s coal research and development activities and carbon capture 

and storage in particular. It is worth noting that although I am the 

deputy assistant secretary for clean coal, carbon capture, and storage technology is not a coal technology per se. It is an environmental technology whose job is to reduce carbon dioxide emissions. 

It has special relevance and importance to the coal-powered systems in this country and in particular the existing and future coal 

fleets. In that context, the Department of Energy continues to play 

a leadership role in the development of clean coal technologies with 

our focus on carbon capture and storage. 

As part of this in December, the department released an $8 billion draft loan guarantee solicitation to promote the early deployment of innovative fossil energy technologies in projects that reduce carbon emissions. This solicitation is added to the already $6 

billion the Obama Administration is committed to clean coal technologies. This reflects the president’s commitment, continued commitment, to an all-of-the-above strategy. And it embraces an energy 

mix of nuclear power, renewable energy sources, and fossil energy 

including clean coal. 

The clean coal research program is addressing the key challenges 

that confront the development and deployment of clean coal technologies. These include research and cost-effective capture technologies, the development and demonstration of advanced coal conversion and environmental control technologies, and the safe and 

effective storage of carbon dioxide in deep geological formations including monitoring, verification, and accounting systems. 

10 

To get there, we are pursuing three technical pathways for carbon capture: post-combustion, pre-combustion, and oxygen-fired 

combustion or oxy-combustion. Research in these pathways is exploring a wide range of approaches that, coupled with advances in 

efficiency improvement and cost reduction, including the developments in gasifications, turbines, and advance combustion systems, 

will help provide a technology base for commercial deployment of 

CCS broadly. 

On the side of storage, we have pursued projects designed to develop innovative advanced technologies and protocols for the monitoring, verification, accounting of CO2 storage in geological formations as well as simulating the behavior of geologically stored CO2. 

The regional carbon sequestration partnerships are an essential 

component of this effort and have successfully executed 19 smallto-large-scale CO2 injection projects nationwide including Texas, 

Alabama, Mississippi, Ohio, Montana, Michigan, and Illinois. The 

program is currently in the development phase during which large 

scale field testing involves at least one million tons of carbon dioxide per project implemented. Several of the large scale tests are 

currently underway, and one project has safely injected over threeand-a-half-million tons of carbon dioxide which continue to be monitored for safe and permanent storage. 

Right now, the crown jewels of our program are the eight major 

large CCS demonstrations deployed around the country. They are 

selected in part on three important bases: likelihood of technical 

success, likelihood of financial success, and covering a wide set of 

national needs. We have industrial and power projects, saline formation, and enhanced oil recovery projects, pre-, post-, and oxyfired projects, and both new-build plants and retrofits. 

The plants within our portfolio produce power, fertilizer, ethanol, 

and methanol. They are important advances in several aspects of 

these projects. For example, in east Texas, the Air Products and 

Chemicals, industrial CCS project is capturing CO2 from two 

steam-methane reformation units, basically hydrogen plants. 

The CO2 captured there is being used for enhanced oil recovery 

operations, and will pass one million tons of total injection this fall. 

As mentioned by several members, the construction of Kemper 

County’s IGCC project by Southern Company is near completion as 

is the completion of the Archer Daniels Midland Industrial CCS 

Project in central Illinois. 

And just last month, FutureGen 2.0 moved closer to construction 

after the DOE approved the record of decision needed to go forward 

with continued work and spending. 

Since the inception of the carbon storage program, the Department of Energy has recognized that a number of utilization technologies could also play important mitigating roles. 

Aside from enhanced oil recovery though, the potential for these 

approaches is limited for a number of technical reasons including 

cost and market factors. In the meantime, enhanced oil recovery 

represents the most commercially attractive utilization option for 

CO2 storage and produces substantial quantities of oil while storing 

carbon dioxide in geological formations. 

There are currently six of those large eight projects which are 

employing CO2 enhanced oil recovery, two doing saline and aquifer 

11 

storage projects across the U.S. As with the saline storage projects, 

the CO2 EOR projects are subject to rigorous monitoring, 

verification and accounting procedures to validate the storage of 

CO2 and verify their safety and effectiveness. 

To conclude, Mr. Chairman, CCS can play a critical role in mitigating CO2 emissions under many potential future carbon stabilization scenarios. Since challenges remain to commercial deployment 

of these technologies, it is the department’s goal and the focus of 

our research efforts to spearhead the research and development 

that would not have occurred otherwise and has successfully leveraged private investments in advancing the readiness of these 

emerging clean coal technologies. Based on our, I believe, successful track record, I believe that our clean coal research program 

demonstrates that we can help meet the challenges associated with 

CCS deployment. 

With that, Mr. Chairman, I would be happy to answer any questions you and the subcommittee have. Thank you for your attention. 

[The prepared statement of Mr. Friedmann follows:] 

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Mr. MURPHY. Thank you. Mr. Klara, we understand you are here 

to answer questions but not to provide an individual statement. So 

thank you. So I will recognize myself first for 5 minutes. 

Dr. Friedmann, thank you for that testimony. The DOE’s fossil 

energy office is responsible for overseeing all of DOE’s research and 

development and demonstration work for clean coal technologies. 

Am I correct on that? 

Mr. FRIEDMANN. Yes, sir. 

Mr. MURPHY. Thank you. And you are the person in charge of the 

clean coal work and report to the assistant secretary, correct? 

Mr. FRIEDMANN. That is correct. 

Mr. MURPHY. OK, the project and research evaluations funding 

recommendations come from your people, your team. Is that right 

too? 

Mr. FRIEDMANN. Yes, in partnership with NETL. 

Mr. MURPHY. And, Mr. Klara, quickly, I know and respect the 

National Energy Technology Laboratory, but for the record, NETL 

brings the science, the technical and engineering expertise to 

DOE’s programs, and your people do the research and development 

and conduct day-to-day project management. Is that correct? 

Mr. KLARA. Correct. 

Mr. MURPHY. Make sure your microphone is on. Now, Dr. 

Friedmann, carbon capture and sequestration has never been implemented commercially yet on a full scale at functioning power 

plants. Is that correct? 

Mr. FRIEDMANN. That is a moving definition, sir. 

Mr. MURPHY. But so far. You are anticipating that it is going to 

happen, but it hasn’t happened yet. Am I correct? 

Mr. FRIEDMANN. No, again it is a moving definition. 

Mr. MURPHY. What does that mean? 

Mr. FRIEDMANN. For example, we have deployed carbon capture 

and storage at the Beulah Gasification Facility for over 30 years 

and done carbon capture and storage from there for enhanced oil 

recovery for over 10 years. That produces high quality natural gas 

which goes into a pipeline that powers power plants. 

Mr. MURPHY. All right, I am talking about commercial. Are those 

commercial plants, research plants? 

Mr. FRIEDMANN. No, that plant has been in commercial operation 

for 30 years. 

Mr. MURPHY. OK, I am talking about coal power plant. 

Mr. FRIEDMANN. That is Burns North Dakota Lignite, sir. Yes, 

it is a coal plant. 

Mr. MURPHY. Now, there presently are five coal powered demonstration projects as part of the DOE funding. Is that correct? 

Mr. FRIEDMANN. Yes, five power projects. 

Mr. MURPHY. One is FutureGen 2.0 which you refer to, and four 

are authorized under the Energy Policy Act of 2005. Is that correct? 

Mr. FRIEDMANN. I am sorry. Can you say that again, please? 

Mr. MURPHY. One is the FutureGen which—— 

Mr. FRIEDMANN. Yes. 

Mr. MURPHY [continuing]. You mentioned, and four others are 

authorized under the Energy Policy Act of 2005. 

Mr. FRIEDMANN. Yes, sir. 

25 

Mr. MURPHY. OK, now pursuant to the Energy Policy Act, the 

technologies of these power plants supported by DOE go well beyond the level of what is commercial service at coal power plants 

or has previously been successfully demonstrated on coal power 

plants. Is that correct? 

Mr. FRIEDMANN. I would say that is fair. 

Mr. MURPHY. OK, and the point of the current demonstrations 

according to your agency is to demonstrate that CCS can be integrated at commercial scale while maintaining reliable, predictable, 

and safe plant operations. Is that correct? 

Mr. FRIEDMANN. Yes, sir. 

Mr. MURPHY. Thank you. But DOE says it won’t really know the 

result of these demonstration projects until they are completed and 

evaluated. Is that correct? 

Mr. FRIEDMANN. The technical findings from these projects have 

been brought forward as the projects proceed. So again even though 

it is not a power project, I would point to the air products project 

in Texas which came online earlier this year, and the technical 

findings and results from that are already available. And as more 

come forward, more are available. 

Mr. MURPHY. Now, I understand that reporting these demonstrations, according to your own project schedule, to take 6 to 9 

years—— 

Mr. FRIEDMANN. Yes. 

Mr. MURPHY [continuing]. For many of these? OK, thank you. 

Mr. Klara, we have spoken about this before. NETL says that the 

CCS technologies in a current state of development are cost prohibitive for full commercial service. What is a realistic timeframe 

based on NETL’s best estimates for a commercially viable technology successfully completing demonstration and coming to market? 

Mr. KLARA. With our program, we divide our technology up into 

three development buckets. We call them first generation technology, second generation, and transformational. And with each 

one of those development horizons, the cost and performance gets 

better. The first generation technology are the technologies that 

you will find in our current demonstration program. And these 

technologies indeed can be commercially offered and commercially 

deployed. With any development, and I think Congressman Waxman referred to this relative to NOx and SOx control, that with 

any development that with a learning curve as well as continued 

development within the Office of Fossil Energy’s Program, you 

can’t expect those costs to go down and the performance to increase. 

Mr. MURPHY. But your documents suggest it will take until after 

about the mid 2020s for second generation technologies and more 

than 20 years for what you call transformational technologies. Am 

I correct in what your documents say? 

Mr. KLARA. The additional buckets of technology, second generation and transformational, will indeed take some more time to 

achieve. 

Mr. MURPHY. So why do you believe that those estimates are realistic? What will take the time? 

26 

Mr. KLARA. I am not sure I understand when you say when do 

we believe. 

Mr. MURPHY. Well that it is going to take to the mid 2020s or 

longer. Why do you believe those timeframes are needed? 

Mr. KLARA. Well, with every bucket of our technologies, we are 

constantly evaluating the R&D portfolio every year looking at how 

developments are proceeding as well as the scope of the portfolio. 

Some projects drop out. Additional projects are brought in. And as 

part of that, we are constantly doing analysis to evaluate when and 

to what level we believe those technologies will achieve. 

Mr. MURPHY. Do you also assess commercial viability in that 

process? 

Mr. KLARA. We assess the cost and performance. We rely on industry and others to determine when it is viable. 

Mr. MURPHY. OK, thank you. I see my time has expired. Mr. 

Klara, when you talk, if you could move that microphone closer to 

your face. Now recognize Ms. Schakowsky for 5 minutes. 

Ms. SCHAKOWSKY. I wanted to underscore something you said. 

You said that there is CCS technology in play used right now commercially and has been for several years. Is that true? 

Mr. FRIEDMANN. Yes, it is. There is commercially available technology that can be sold by a wide number of vendors, U.S.-based 

and international with the heavy of equipment manufacturing 

made in this country. Pursuant to the earlier conversation, most of 

those technologies have been applied to industrial facilities. For example, the Beulah site is a synthetic natural gas plant. 

But in point of fact, the same technologies have been demonstrated around the world in other coal-fired facilities. 

Ms. SCHAKOWSKY. And would that technology fit into bucket one? 

Is that what you are saying? 

Mr. FRIEDMANN. Yes, first generation. 

Ms. SCHAKOWSKY. And to what extent does that reduce then the 

carbon pollution? I mean you are saying that we want to get to the 

third generation. 

Mr. FRIEDMANN. Right, so that actually varies by site and by 

plant. Some of the plants, for example the Beulah one I mentioned 

before, basically acts as about a 50 percent decarbonization. Other 

plants we have seen, for example, the Air Products plant is essentially 90 percent decarbonization. We believe FutureGen will be effectively 100 percent decarbonization when it is active. But it depends on the technology. It depends on the plant. It depends on the 

type of coal used and has to be calculated as such. 

Ms. SCHAKOWSKY. I think what we are going to hear today is 

that somehow this technology is not ready for commercial use, that 

the production and the timeline is very long and that what the 

president is doing to regulate carbon pollution from new coal-fired 

power plants is not appropriate. Could you comment on the veracity of that argument? 

Mr. FRIEDMANN. We see our role chiefly as enabling the reduction of cost and the improved performance of these technologies as 

they enter the market and to work with commercial industrial 

partners on the commercialization themselves. Our job is not the 

commercialization or the determination of economic viability. Our 

job is to support the technology and the development of that. 

27 

Ms. SCHAKOWSKY. OK, am I correct that there are three basic 

steps in CCS, separately and compressing CO2, transporting it by 

pipeline and injecting it underground? 

Mr. FRIEDMANN. Correct. 

Ms. SCHAKOWSKY. And, Dr. Friedmann, do we know how to separate and compress CO2 with current technology? 

Mr. FRIEDMANN. Yes, we do. 

Ms. SCHAKOWSKY. And have we figured out how to transport CO2

by pipeline? 

Mr. FRIEDMANN. Yes, ma’am. 

Ms. SCHAKOWSKY. And do we understand how to inject carbon 

into the ground? Is there enough viable storage underground to ensure that we can inject CO2 without constraints? And a safety 

question was raised as well. 

Mr. FRIEDMANN. Yes, ma’am. 

Ms. SCHAKOWSKY. And so the basic building blocks are all technologically viable? 

Mr. FRIEDMANN. The large-scale components of CCS have been 

shown and demonstrated. And that is an important technical finding. 

Ms. SCHAKOWSKY. OK, finally, Dr. Friedmann, are there companies today that will sell technology to power plant operators looking to implement CCS technology? 

Mr. FRIEDMANN. Yes, ma’am, with a performance guarantee. 

Ms. SCHAKOWSKY. With? 

Mr. FRIEDMANN. With a performance guarantee. 

Ms. SCHAKOWSKY. So it sounds as if CCS is both real and available. We also hear from the Republicans that CCS simply costs too 

much, but the history of large-scale technology development and 

the Clean Air Act in particular is full of examples of pollution control costs decreasing over time with continued innovation and 

economies of scale as technologies mature and become widespread, 

costs naturally come down. Would you anticipate that CCS costs 

will come down as the technology matures and is put in place in 

more locations? 

Mr. FRIEDMANN. Indeed. 

Ms. SCHAKOWSKY. And why would that happen? 

Mr. FRIEDMANN. As with all clean energy technologies, the value 

comes from deployment and cost reduction comes from deployment. 

Engineers learn things, and they come up with new ideas. We have 

seen this for many, many different kinds of technology deployment, 

but it has been clearly demonstrated for many energy technologies 

as well, from wind turbines to solar panels to coal gasifiers to many 

other kinds of technologies. And based on our thermodynamic assessments and based on our engineering assessments, we see multiple clear pathways to substantial cost production. 

Ms. SCHAKOWSKY. Thank you. It seems to me what we can’t afford is the cost of carbon and other pollution from coal. And as Mr. 

Waxman said, what we are hoping for today is both to help the environment and coal. And I yield back. 

Mr. MURPHY. Gentlelady yields back. Can you just clarify on her 

question? Were you referring to costs going down on current plants 

or future plants? 

Mr. FRIEDMANN. Both. 

28 

Mr. MURPHY. OK, so current plants that have already made their 

investment will see their cost decline because they are saying they 

will make further investments. I just want to make sure on her 

question. 

Mr. FRIEDMANN. Thank you for providing me the opportunity to 

clarify that. That is an excellent question. Any retrofit to an existing power plant will necessarily add cost, but the cost of abatement 

itself today is a certain price and will go down over time as more 

technology is developed and deployed. 

Mr. MURPHY. Thank you. Now recognize the Chairman Emeritus 

of the Committee, Mr. Barton, an engineer himself. 

Mr. BARTON. Well, thank you, Mr. Chair. I am not a registered 

professional engineer anymore. I used to be, but to the registered 

professional engineers, that is as it should be a sensitive issue. So 

I have been registered, but I am not at this time. But I was trained 

as an engineer and did practice as a registered professional engineer. 

I know that the purpose of this hearing is not on the legality of 

these standards, but I do just want to point out that in the Energy 

Policy Act in 2005, there is a section 402(i) that very specifically 

says that these clean coal standards cannot be set on projects that 

are demonstration projects that are receiving assistance. It is explicit. The chairman and several others of us have sent a letter to 

the EPA and DOE on that. I mean to EPA, but that is a subject 

for a different issue. 

My generic question is pretty straightforward. All of these carbon 

capture sequestration technologies add cost to these coal plants. 

Could you all give the subcommittee kind of a baseline estimate of 

how much it adds to the cost? Does it double the cost? Does it increase it by 25 percent, 50 percent? What is the generic estimate? 

Mr. FRIEDMANN. Thank you very much for your question. I am 

happy to provide that answer. It is a question that a great number 

of people are asking. First a quick caveat. Again that number, the 

precise number, will vary by plant whether it is subcritical or 

supercritical by coal rank, and by the kind of technology used. 

Typically we express these costs as a range. So for the first generation technology that Dr. Klara was mentioning earlier, we are 

looking at something on the order of $70 to $90 a ton. In that context, that looks something like a 70 or 80 percent increase on the 

wholesale price of electricity. 

For the second generation technologies, which we are developing, 

it is our strong expectation that that number will be roughly half. 

We will be looking at something like a $40 or $50 a ton cost. 

Mr. BARTON. So the initial technology almost doubles the cost, 

and the next generation is going to add 25 percent to the cost. Is 

that fair? 

Mr. FRIEDMANN. Again with respect to the wholesale price, yes. 

The retail price, of course, will vary by market. One of the points 

that I would like to make though, it is in fact a substantial percentage increase in the cost of electricity. But in part, that is because the current price of coal is so low that it represents a large 

percentage increase. 

Mr. BARTON. Now, what has to happen to go from doubling to 

only increasing by 25 to 50 percent? What is the timeframe for 

29 

that? And how many plants have to be built and how many more 

billions of dollars or hundreds of millions of dollars have to be 

spent? 

Mr. FRIEDMANN. I am going to answer partly and then leave the 

rest of the answer to Mr. Klara for that. Again we have laid out 

a very clear road map for R&D programs, and we believe that we 

will hit the marks that we have laid out in terms of major milestones and deliverables. We are looking towards a second generation of demonstrations coming forward in the next few years. They 

would be completely deployed and the learnings provided back to 

the public about the middle of the next decade, 2022 to 2025 timeframe. And those second generation demonstrations would have 

substantially reduced costs. Mr. Klara. 

Mr. KLARA. Yes, and I will just confirm what Dr. Friedmann said 

in terms of a 10 year or less timeframe to get to that second generation developmental efforts. Relative to costs to do that, our assumption for that is that we will have levels commensurate with 

what we have today going forward. And that is our basis in determining if and when we can hit those marks. And again the 10-year 

time horizon or less is the horizon we believe we are looking at 

right now for these. 

Mr. BARTON. So 10 years is good. Now, all of these demonstration 

projects, I believe, so far are on capture and sequestration, but 

former Congressman Rick Boucher when he was on the committee 

and the subcommittee chairman of the Energy Subcommittee had 

a bill that he tried very hard to get me to cosponsor. I never was 

able to unfortunately, but I got him to put in that bill some language on conversion of CO2. I happen to think that it is going to 

be much more cost effective to convert CO2 as opposed to capture 

and sequester it. Is EPA or DOE doing any research right now on 

CO2 conversion as compared to capture and sequestration? And 

this will be my last question. 

Mr. FRIEDMANN. Yes, sir. The good news is indeed we are. In addition to carbon capture and storage, we also do research in carbon 

utilization which includes using CO2 to make beneficial products or 

converting the CO2 into other substances or products themselves. 

Currently the majority of that effort is in enhanced oil recovery, 

which provides many benefits to the country including domestic secure fuel supply at low cost. There are other pathways to utilization which we are pursuing. There is a project actually in Texas, 

the Skyonics Project which we are piloting at about $110 million. 

That is going to convert carbon dioxide to basically mineral aggregate and cement admixtures. 

We are also looking at converting carbon dioxide into algae and 

then that algae into other useful products including animal feed on 

one end of the spectrum and possibly biofuels on the other. We 

have a project at the Polk Plant in Florida where we are doing that 

today. 

Mr. BARTON. You were ready for that question. Thank you. 

Mr. MURPHY. The gentleman’s time has expired. Now recognize 

Mr. Waxman for 5 minutes. 

Mr. WAXMAN. Thank you, Mr. Chairman. Well that is what this 

hearing is all about, so I would expect you to be ready for all of 

30 

our questions since this is the field in which you both work so carefully. 

Industry can pollute because it costs less to dump pollution than 

to pay to clean it up. Unfortunately dumping pollution is never 

really free. There are costs. The American people bear those costs 

and bad health, and our environment is also polluted. And we pay 

a price for that. So the Clean Air Act is one of the most successful 

environmental laws in the world, and one reason the Clean Air Act 

works so well is that it sets standards to drive technological innovation in pollution controls often called technology forcing standards. 

Currently there are no limits on carbon pollution from coal-fired 

power plants. These plants are allowed to emit unlimited carbon 

pollution into the atmosphere, and that is just what they do. EPA 

is proposing carbon pollution standards that would address this 

problem by requiring the new power plants, coal-burning power 

plants, to reduce carbon pollution by 30 to 50 percent through the 

use of partial carbon capture and sequestration technology or CCS. 

Dr. Friedmann, if we didn’t have an EPA requirement, would you 

expect the power sector to use CCS at new coal-fired power plants? 

Mr. FRIEDMANN. It is unlikely that they would deploy CCS technology in large part because they would not be able to get return 

on their investments through the public utilities commission process. 

Mr. WAXMAN. And they don’t want to make an investment on 

something where their competitors aren’t spending that money either. Isn’t that correct? 

Mr. FRIEDMANN. It is worth mentioning that I am not a utility 

executive, but that has been my experience. 

Mr. WAXMAN. Well, if you don’t have this requirement, why 

spend the money? Why would a coal company or a power plant 

want to spend the money if they didn’t have to if they could do it 

without having to spend the money and they can continue doing 

business as usual? 

In 2011, American Electric Power abandoned its plan to install 

full-scale CCS at the Mountaineer Plant because the company 

could not recover its costs in the absence of a government requirement. So without a mandate, we are not going to get carbon pollution controls on coal, and that is why EPA rules are so essential. 

Of course, government can also help industries develop the technology to meet pollution standards. There is a long history of government investment spurring private sector innovation in areas 

such as defense, technology, energy development. Even small government investments can produce big gains for the public and create huge new markets. Dr. Friedmann, isn’t this what your office 

does? You invest in new technologies and work with the private 

sector to help clean up coal? 

Mr. FRIEDMANN. Indeed it is. We spend our appropriations with 

the purpose of developing this technology, demonstrating its validity, and helping commercialize it in partnership with both utilities 

and heavy equipment manufacturers and other industrial partners. 

Mr. WAXMAN. Besides CCS, what are some examples of pollution 

control technologies for coal or coal efficiency technologies that 

DOE has invested in and helped bring to market? 

31 

Mr. FRIEDMANN. One example is the TRIG Gasifier. The transport gasifier was developed as a partnership between Southern 

Company and the Department of Energy over the past 30 years. 

That is the core technology in the Kemper County demonstration, 

and we have helped bring that from pilot reactor scale up to large 

scale commercial demonstration. 

Another example is a coal drying technology. This was funded actually between 2000 and 2004 in North Dakota with the Coal 

Creek Plant in which the lignite drying was used to increase the 

efficiency of the power plant output and did so between two and 

four basis points on the plant. 

Mr. WAXMAN. So you had SCR and more efficient boilers. Is that 

right? 

Mr. FRIEDMANN. SCR is another technology which 

desulfurization and de-NOx technology, mercury technologies, they 

are all technologies which the Department of Energy has supported 

over the years. 

Mr. WAXMAN. But we have a long record of DOE’s investments 

and EPA standards that work hand in hand. For example, DOE 

funded the first U.S. demonstration of a technology, this SCR, the 

selective catalytic reduction, which was ultimately used to comply 

with EPA’s NOx standards in the 1990s. The same is now true 

with CCS. DOE has helped develop the CCS technologies needed 

to reduce carbon pollution from new coal-fired power plants, and 

now EPA has proposed reasonable standards that will take advantage of these demonstrated technologies to reduce carbon emissions. 

Dr. Friedmann, what are the other advantages of these government investments? Do you think there will be a global market for 

American CCS technologies? 

Mr. FRIEDMANN. Indeed we are already seeing that. We are seeing companies around the world, most notably in Japan and in 

China, which are interested in United States technology that is 

considered clean coal technology both because of high efficiency and 

because of potential for carbon capture. 

Mr. WAXMAN. So it is good for American business? We can export 

this? 

Mr. MURPHY. The gentleman’s time has expired. 

Mr. WAXMAN. Well, I want to at least go as long as my colleague. 

Mr. FRIEDMANN. I think that would remain to be seen. 

Mr. MURPHY. He went over 55 seconds, so—— 

Mr. WAXMAN. So I think we ought to celebrate the ability of the 

new technologies to go along with the standards because it is going 

to be a win-win proposition. Thank you, Mr. Chairman, for your indulgence. 

Mr. MURPHY. We will get the facts. You are welcome. I will now 

recognize Dr. Burgess for 5 minutes. 

Mr. BURGESS. Thank you, Mr. Chairman. Again, thanks to our 

witnesses for being here and being so thoughtful in your preparation and your answers. Can we talk just a little bit about the feasibility and what you have been able to demonstrate commercially? 

I mean, I get it that small projects may hint at the feasibility of 

doing this type of activity. But where do you think we stand as far 

as pushing at the commercial viability? Because after all, that is 

32 

what I think the government investment was working toward, not 

just an interesting experiment but something that will actually 

work. So can you give us a sense of that feasibility versus commercial viability? 

Mr. FRIEDMANN. Absolutely. Thank you for your question and 

again this is a core question which is asked of the CCS community 

regularly. I am happy to provide some clarification. As I mentioned 

before, this first generation CCS technology is commercially available today. You can call up a number of U.S. and international 

manufacturers, and they will sell you a unit at a large scale for 

capture of more than a million tons per year. In fact, a number of 

our large projects, for example, the Petro Nova Project in east 

Texas is run by NRG, in fact is using commercially available postcombustion capture technology unit. That procurement we expect 

to happen this year after they reach financial closure. 

Mr. BURGESS. Now do you have any projection for the return on 

investment, say for that NRG project in east Texas? 

Mr. FRIEDMANN. Thank you. I am very happy to answer that 

question. Again this is an important one, and it will take just a moment to answer so please bear with me. We consider it an important function of the Department of Energy and as a government 

public goods return to help fund the first-of-a-kind project. Firstof-a-kind projects are not projects which a bank will finance ever. 

So typically we provide anywhere from 10 to 30 percent of the cost 

share into a project to match the private capital do the rest. 

It is also our experience that the second-of-a-kind project is 

something the market takes on itself. In our communications with 

NRG so far, they have been very pleased with the return on investments they are going to get, granted given that government money 

that helped get the project over the top. In large part, that is because of the return on investment from enhanced oil recovery revenues. And they purchased a component, an equity into the field 

which are producing additional oil from the CO2 injections. 

The last thing I wanted to say on this is that they have also told 

us that they believe that what they have learned on the first 

project is sufficiently good that they can do a second project and 

get sizable returns on investment without government assistance. 

Mr. BURGESS. And have they prepared for you then any sort of 

pro forma or any type of accounting where the taxpayer investment 

may be expected to return a yield in the future? 

Mr. FRIEDMANN. One of the things that is important about the 

deployment of these technologies is that it spurs new business 

models. One of the things that we have seen is they are creating 

a new business model by aggregating and holding company projects 

like this one and the other to get those returns. 

Mr. BURGESS. Yes, my time is going to run out, so I am going 

to need to interrupt you. I am not trying to be rude here, but you 

did, I think, reference into another question that some of this activity has been going on for what did you say, 30 years or 35 years 

in the commercial production of carbon for oil recovery? Is that correct? 

Mr. FRIEDMANN. Yes, sir. 

33 

Mr. BURGESS. So at what point? It has been 30 or 35 years. At 

what point can we expect to see a return on investment if there is 

in fact a commercial application for recovered carbon dioxide? 

Mr. FRIEDMANN. For most applications in the power sector, which 

is the area of greatest concern, I believe, to this committee, there 

is still a gap between how much you can sell CO2 for in post-combustion and how much you can—how much it costs to deploy. A 

typical CO2 off-take agreement for enhanced oil recovery is between 

$30 and $40 a ton. Typical post-combustion capture is between $40 

and—I am sorry—is between $70 and $90 a ton. And you can’t 

make that up on volume. 

Mr. BURGESS. No, you can’t. 

Mr. FRIEDMANN. So that is part of the basis on which we continue to develop low cost technologies. 

Mr. BURGESS. Again I am going to interrupt you because I need 

to go in another direction very quickly. I mean we are—in my home 

State of Texas, energy production is a big deal. There are some concerns surrounding a different type of energy technology and energy 

production with recent effects on seismic activity. Now, the head of 

the Texas Railroad Commission came and talked to us in 2005. He 

said the State of Texas was going to take title to the carbon that 

was being sequestered at one of the projects. How important is that 

that a state take that title to that compound? And then I guess the 

inference in that is the state would then have the liability that 

would not be borne by the industry. 

Mr. FRIEDMANN. We continue to do work with the Bureau of Economic Geology, which is in close partnership with the Railroad 

Commission in Texas. We have a number of programs in our house 

which look at the potential risks associated with CO2 leakage, 

events like seismicity and how to manage those and monitor it 

well. The questions of long-term liability are ones which still remain open. There are many, many potential policy pathways to 

manage transfer of liability and these sorts of issues. 

At this point, I believe that mechanisms like the one you described were put in place in part to attract industry to find ways 

to make it more advantageous and more possible in a state such 

as yours and Texas to execute CCS projects. 

Mr. BURGESS. Thank you. Thank you, Mr. Chairman. 

Mr. MURPHY. The gentleman’s time has expired. Now recognize 

the gentlelady from Florida, Ms. Castor, for 5 minutes. 

Ms. CASTOR. Well, good morning, and thank you, Mr. Chairman, 

for calling this Oversight hearing on the Department of Energy’s 

clean coal initiatives. Last June, President Obama issued a climate 

action plan, correctly noting that we have a moral obligation to 

leave our children a planet that is not polluted or damaged. 

One way we can do that is through smart, clean technology investments like the kind that the Department of Energy is demonstrating with the next generation of power plants that employ 

carbon capture and storage. And I would like to find out from our 

witnesses how they believe their work fits in with the president’s 

climate action plan and how the clean coal research program is 

helping to combat climate change and reduce emissions of harmful 

greenhouse gases. 

34 

Dr. Friedman and Mr. Klara, coal constitutes a significant percentage of this country’s carbon emissions, approximately 30 percent. So logically cleaning up coal is essential to tackling climate 

change. Do you both agree with that statement? 

Mr. FRIEDMANN. I am sorry. Could you make that statement 

again? I want to make sure I am answering correctly. 

Ms. CASTOR. Coal constitutes a significant percentage of the 

country’s carbon emissions, approximately 30 percent. So logically 

cleaning up coal is essential to tackling climate change. 

Mr. FRIEDMANN. There have been many economic analyses of a 

whole slate of clean energy technologies, and what has been the 

overwhelming conclusion of all of those studies is that if you take 

any clean energy technology option off the table, the cost of reducing CO2 emissions globally goes up. If you don’t have an option like 

CCS, the total cost of managing climate change goes up. But that 

is true of all of the clean energy technologies. 

Ms. CASTOR. Mr. Klara? 

Mr. KLARA. And I think it is important to note also that our technology set is not just about coal. Our technology set is about CO2. 

So if you look at the capture technology portfolio, most if not all 

of those technologies could work on natural gas, fire electricity, et 

cetera. If you look at the transport and storage component, a CO2

molecule is a CO2 molecule. 

So the importance here is that the portfolio is truly a global portfolio that could impact future CO2 emissions. 

Ms. CASTOR. Now, your testimony so far has illuminated that you 

have done substantial work on clean coal and carbon capture really 

probably more than most people appreciate that has been going on 

not just under the Obama Administration but under the Bush Administration before that. 

But now with the new climate action plan that is very broadbased and focused on a number of different strategies to reduce 

carbon pollution, Dr. Friedmann, how do the Department of Energy’s carbon capture and storage investments fit in with the president’s climate action plan? 

Mr. FRIEDMANN. It is actually literally central to the plan. It is 

in the middle of the document that carbon capture and storage is 

an important part of the strategy, and the basis for that is what 

I described before. Removing any option actually ends up increasing the net cost of the body public. 

Ms. CASTOR. And are there any other coal technologies that can 

reduce carbon pollution as much as carbon capture and storage? 

Mr. FRIEDMANN. There are many coal technologies that could improve the efficiency of coal conversion that could reduce the emissions some. In order to dramatically reduce CO2 emissions, carbon 

capture and storage would be required. 

Ms. CASTOR. OK, if the Department of Energy and researchers 

and your industry partners are able to successfully develop and advance CCS technology portfolio for large-scale deployment by 2020, 

what kind of impact do you think that could have on CO2 emissions 

and our climate? 

Mr. FRIEDMANN. That ultimately really is a function of the rate 

of deployment, and the rate of deployment is contingent on many, 

many things. It is our hope to see increase in large-scale deployVerDate Nov 24 2008 14:54 Sep 08, 2014 Jkt 037690 PO 00000 Frm 00040 Fmt 6633 Sfmt 6633 F:\MY DOCS\HEARINGS 113\113-118 CHRIS
35 

ment quickly so that, say by 2050, somewhere between 12 and 20 

percent of U.S. emissions and 12 and 20 percent of global emissions 

would be managed through carbon capture and storage. 

Ms. CASTOR. OK, well I am glad the Department of Energy is 

making these important investments because the dangers of climate change are real. The costs that face our communities all 

across this country are very significant, the costs to all Americans, 

the cost to businesses. We simply cannot put our head in the sand. 

Yet you see power plants today. They still have that business incentive to emit unlimited amounts of carbon into our atmosphere, 

and that means the rest of us will pay the price. So we have got 

to work on this together. It is important that we make smart, clean 

technological investments now. Otherwise, we will not only make 

climate change worse, but we will make it harder and more expensive to address the problem in the future. And we can’t afford to 

ignore the crisis. This is America, and we can tackle this together. 

Thank you very much. 

Mr. MURPHY. Thank you. The gentlelady’s time has expired. Now 

recognize Dr. Gingrey for 5 minutes. 

Mr. GINGREY. Dr. Friedmann, you have been so accurate in answering all these questions. I am thinking about asking you your 

opinion on how much CO2 would be released into the operating 

room if you did a hysterectomy by robotic surgery versus the open 

convention method. I am just kidding, of course. I won’t ask you 

that. You probably would have the answer to it. 

The first generation CCS project is currently on the way to fullscale demonstration do not all demonstrate the same technologies, 

do they? 

Mr. FRIEDMANN. No, sir. 

Mr. GINGREY. What is the value of demonstrating different types 

of technologies? 

Mr. FRIEDMANN. Let me start answering this and then leave Mr. 

Klara some time as well. Today on a thermodynamic basis and on 

a cost basis, all of the pathways look equally viable. Given that, it 

is hard to decide which technologies the market will select based 

on engineering and based on long-term cost reduction and viability. 

That is the basis on which we are pursuing pre, post and oxy-combustion pathways because on a thermodynamic limit basis and on 

an engineering improvement basis, they all look like they could be 

winners. 

Mr. GINGREY. Before we go to Mr. Klara, the second part of that 

question. Are the current technologies being demonstrated sufficient to answer all the technical questions about full-scale operations of CCS for all types of coal plants using all types of coal? 

Mr. FRIEDMANN. We would say the overwhelming majority of 

questions on the overwhelming majority of plants. 

Mr. GINGREY. Mr. Klara, did you want to comment on that? 

Mr. KLARA. Yes, I would like to comment that relative to our 

portfolio of technologies that one size doesn’t fit all. Sorry about 

that. Better? Relative to our portfolio that one size doesn’t fit all. 

So a portfolio of technology is sometimes needed to get the widest 

deployment. And also too it is important, I think, in a portfolio to 

have multiple technologies essentially competing with one another. 

36 

And so what that does is it tends to really be a forcing factor to 

drive the cost down substantially relative to these competing options. 

Mr. GINGREY. Let me go back to Dr. Friedmann. According to 

DOE’s December 2010 CCS R&D and demonstration roadmap, 

there were seven CCS demonstration projects for coal power plants. 

Three of these plants were estimated to start up in 2014, three 

2015, and one in 2016. To date, only one project, Kemper County, 

Mississippi gasification project operated by the Southern Company, 

the great Southern Company headquartered in Atlanta, Georgia, is 

expected to start operations this year roughly on schedule. Two of 

the projects have been cancelled, and the remaining four projects 

are 2, 3, and 4 years behind schedule according to project summaries reviewed by our committee staff. 

First do you agree that some of these projects are significantly 

behind schedule? And secondly is it possible that we will see further delays or even abandonments before getting to the point of 

pushing the switch to start up operations given that four of the five 

projects are still only on paper? Construction has not commenced, 

and finance hasn’t all been closed. 

Mr. FRIEDMANN. Thank you. That is an excellent question, and 

I am happy to answer it. It is the nature of large projects that they 

take longer than expected, cost more than expected, and some of 

them don’t make it. In this context, it is part of the reason why 

we are so committed to the portfolio of projects that we have. 

Sometimes things just get in the way, and you can’t anticipate 

them. In that exact context, we are passionately committed to seeing all of those projects succeed, all eight of them. And right now, 

we are on a trajectory where all eight of those projects are headed 

for commercialization. And I want to just reiterate, I do not believe 

and I would not say that I am concerned about the delays. It is the 

nature of large projects, in particular getting the debt financing 

and the equity. 

Mr. GINGREY. Let me ask Mr. Klara to comment on that too as 

well, Dr. Friedmann. 

Mr. KLARA. On the same topic? 

Mr. GINGREY. Yes, on the same topic, yes. 

Mr. KLARA. Yes, it is a difficult environment right now relative 

to putting new plants in play, and that difficult environment has 

a couple factors to it. One is that it requires billions of dollars 

worth of financing to put a plant into play and financing is—— 

Mr. GINGREY. OK, I am going to stop you because I have one last 

question that I want to get in and I don’t want to run over time. 

Now, if that is the case, how has the Department of Energy been 

adjusting its timeframes and game plan to ensure that CCS technologies for coal-fired power plants are sufficiently demonstrated 

across the types of coal and various types of coal plants? Will you 

have all the answers by 2025, 2030? And what happens if two or 

three of these coal projects are significantly stalled or indeed cancelled? 

Mr. FRIEDMANN. Again we are still on track for what we think 

is the second generation of demonstrations by 2025, and that that 

is the timeframe in which the most important learnings will be 

needed. Even if one or two of the projects should unfortunately 

37 

happen to fall apart, that would leave a gap in our understanding 

but would still provide a lot of information and a lot of technical 

findings around what is necessary to get projects off the ground 

and the likely performance of the technologies. 

Mr. GINGREY. My time has expired. 

Mr. MURPHY. Thank you. The gentleman’s time has expired. Now 

recognize Mr. Tonko for 5 minutes. 

Mr. TONKO. Thank you, Mr. Chair. House Republicans have 

talked incessantly about the administration’s supposed war on coal. 

This simply doesn’t square with reality. The fact is the Obama administration has invested billions of dollars in projects with industry partners to advance technologies for coal-fired power generation. 

DOE’s CCS investments along with the EPA’s proposed carbon 

emission rules for electric plants will assure that coal has a way 

to remain viable even as we have to cut carbon pollution and avoid 

catastrophic climate change. That being said, Dr. Friedmann, how 

do you react to the allegations that the administration is waging 

this war on coal? You work with the coal industry on a regular 

basis. What is your relationship with the industry like? 

Mr. FRIEDMANN. It is both my pleasure and my privilege to work 

with the coal industry, which contains some of the best minds and 

the best businesses in the United States. And I continue to believe 

that coal is actually a required part of a vibrant American economy 

and part of the future. In this context, the work we are doing on 

CCS is critical. It is a key pathway forward for a sustainable lowcarbon energy future with an era of abundance of fossil energy that 

we live in today. 

Mr. TONKO. Thank you. And, Dr. Friedmann, how important do 

you think DOE’s CCS investments are for the future of the coal industry? 

Mr. FRIEDMANN. Again it is very hard to achieve climate change 

goals and deep emissions reductions in the fossil energy sector 

without CCS. Secretary Abraham in 2002 called it basically a cine 

qua non technology. It is a technology which we simply need to 

have. 

Mr. TONKO. And DOE invested some $270 million, I believe, in 

the Kemper facility. 

Mr. FRIEDMANN. $270 million, sir. 

Mr. TONKO. Right. 

Mr. FRIEDMANN. Yes. 

Mr. TONKO. In the Kemper facility that is set to come online 

later this year. How much private capital was added to that DOE 

initial investment? 

Mr. FRIEDMANN. I believe at this point, it is up about $4.5 billion 

total. 

Mr. TONKO. Four point five billion? 

Mr. FRIEDMANN. Yes, sir. 

Mr. TONKO. Well, that is an immense investment to new coal 

spurred by DOE funds. And according to Southern Company subsidiary, Mississippi Power, the project is creating nearly 12,000 direct and indirect construction jobs and will create over 1,000 direct 

and indirect permanent jobs. 

38 

Dr. Friedmann, DOE has also invested $450 million in this Summit Texas Clean Energy Project. How much private financing was 

added to DOE’s investment in that given project? 

Mr. FRIEDMANN. OK, we have committed to Kemper—I am 

sorry—to Summit, it is a commitment. It has not yet been spent. 

But it is close to financial closing. It has not yet closed financially. 

It is our expectation that we will ultimately lever about $3 billion 

of foreign direct investment into that project. 

Mr. TONKO. And again according to the company, my information 

is that the project is expected to create up to 2,000 direct construction jobs and 150 direct permanent jobs. So what do you think 

these projects tell us about the future of CCS? Are private financiers going to invest billions in projects like this if they don’t see 

them as viable or profitable? 

Mr. FRIEDMANN. Again a critical finding for the Department of 

Energy’s work in all energy sectors is that we cannot attract investment in the first plant absent government support. Once the 

first plant is built and demonstrated and improvements are made 

in engineering, business model and financing, then the second 

project and the third project can get done by the private sector. Absent that initial federal investment, the project won’t get built. 

Mr. TONKO. We are focusing on CCS today, but there are other 

ways to reduce carbon emissions through increasing the efficiency 

of coal-fired generation. And Representative Waxman, I believe, 

asked you a bit about that efficiency. What level of efficiency improvements are being targeted by your research program? 

Mr. FRIEDMANN. We are basically looking to make for the most 

part incremental improvements in the efficiency. For people who 

aren’t engineers, a one or two percent plant efficiency sounds 

small, but it is not. It is actually a big improvement on the output 

of the plant. Just a couple of basis points actually is big. For individual components of the program, for example sensors and control 

systems, advanced manufacturing, these sorts of things, for the 

most part can improve the existing fleet each a couple of percent. 

Mr. TONKO. I know that I have used up my 5 minutes. So with 

that, I will yield back, Mr. Chair. 

Mr. MURPHY. Thank you. Just to clarify what you said, you said $270 million, is that what your—— 

Mr. FRIEDMANN. For the Southern Company Project, yes. 

Mr. MURPHY. Energy. And I think there was also some investment tax credits, $130 million or so. 

Mr. FRIEDMANN. So the $130 million of investment tax credits 

are set to lapse in May because of the delays associated with the 

project. 

Mr. MURPHY. So they will not get that investment tax credit? 

Mr. FRIEDMANN. We are still in discussions with the IRS, but at 

this point, no, they would not be eligible to receive those investment tax credits. 

Mr. MURPHY. And just can you follow up. So the initial costs, I think, were $1 billion now. It is $4.5 to $5 billion talking about the 

plant costing? 

Mr. FRIEDMANN. I think the original plant costs were more like $2 billion, but yes, there has been substantial increases in the cost 

of the plant. 

39 

Mr. MURPHY. Thank you. Thank you for clarifying that. Now I 

recognize Mr. Scalise for 5 minutes. 

Mr. SCALISE. Thank you, Mr. Chairman. I appreciate you holding 

this hearing, and I want to thank our two guests for coming from 

the department. The 2010 report on interagency task force on carbon capture and storage. I believe that was both Department of Energy and EPA that put that report together. But it notes that existent CO2 capture technologies for coal-based power plants ‘‘are not 

ready for widespread implementation primarily because they have 

not been demonstrated at the scale necessary to establish confidence for power plant application.’’ And the DOE goal of developing systems that result in a less than 10 percent increase in the 

cost of energy by 2015 is still at a conceptual stage. 

So we had Kemper here before our committee talking about some 

of the challenges that they are facing in kind of being that first 

company to come out and do this. I think you all recognize that, 

you know, we still don’t have a replicable model. It seems like 

there is a difference between Department of Energy and EPA on 

whether or not you have got one plant being built, how their experience is working, especially with the uniqueness of their location 

to energy sites where, if you can use that carbon capture to do enhanced oil recovery, which is definitely something that is important 

to our state in Louisiana, Texas, other states. 

But if you don’t have that same proximity, then the viability isn’t 

the same either, and do you all recognize that especially when you 

are looking at whether this facility is a replicable facility? 

Mr. FRIEDMANN. So because it has been brought up twice, let me 

mention that Mr. Klara was an important contributor to the 2010 

report. I would be remiss if he didn’t have a chance to at least 

speak to it. But to the pursuant of your question, the technical 

availability is independent of the economic viability. And we in fact 

have—you can deploy the same technology in Illinois where there 

is not enhanced oil recovery opportunities as you would deploy in 

Texas. 

The return on investment would vary, and part of the goal is to 

find ways and pathways that we can pursue to reduce the cost so 

much that the local increase in cost of electricity is as low as possible. 

Mr. SCALISE. And I will let Mr. Klara give his answer first, and 

then I want to get into that, that increased cost of electricity because at the end of the day, consumers are concerned as people are 

out advancing new technologies, we all promote the advancement 

of new technologies. But you have also got to be concerned about 

the impact on consumers when they talk about whether or not it 

is going to increase their household electricity rates. That is their 

main concern, and clearly we are seeing increases in a number of 

these areas on the amount people pay for their household electricity. That affects lower income people most, and yet that is one 

piece of the equation that I am not sure if EPA is really that concerned about right now. But, Mr. Klara, if you want to go. 

Mr. KLARA. The purpose of our demonstrations is indeed to get 

us over that hurdle of proving the technologies in a commercial 

scale, and you mentioned the cost issue. These projects are first of 

40 

a kind, and, as Dr. Friedmann indicated, that is why the government investment is so important to get them up over that hurdle. 

And what we can speak of relative to cost, again going back to 

some earlier comments, would be the fact that our portfolio is designed to drive that cost down substantially in addition to these 

learning curves which these demonstrations are critical to get 

started. 

Mr. SCALISE. Let me ask you. We know that at present none of 

the CCS technologies for coal-fired plant power generation has successfully completed demonstration. Is that correct? 

Mr. FRIEDMANN. In this country, that is correct. 

Mr. SCALISE. OK, we know that this will take upwards of 10 

years to establish. Is that correct? 

Mr. FRIEDMANN. I don’t think that is correct actually. 

Mr. SCALISE. How long do you think it would be? 

Mr. FRIEDMANN. Again we are already gathering learnings from 

our demonstrations as they are standing up. Kemper will be operational at the end of this year. That will be an important technical 

finding, and within sort of 2 or 3 years of operation, we should 

have a strong sense as to whether or not that plant is replicable 

in a viable option for the future. 

Mr. SCALISE. Well, and I hope you would know that Southern 

Company, the owner of the Kemper plant, has said that this plant 

‘‘cannot be consistently replicated on a national level.’’ Were you 

aware that they said that? 

Mr. FRIEDMANN. Yes, sir. We have had those conversations with 

the CEO and the senior staff of Kemper and of Southern Company. 

That is exactly the basis on which we have a wide portfolio of 

plans. 

Mr. SCALISE. Because they are the ones that are out there making this big investment. They are seeing that the costs are a lot 

more than anybody expected, and they are also recognizing the geographical limitations that you can’t just—and if EPA wants to go 

and say OK, look, they were able to do it and they figured out a 

way to make it work, cost them a whole lot more than they were 

expecting, but they made it work, discounting the fact that the way 

they had to make it work was having this close proximity for EOR. 

Then they are going to go and say OK, well now everybody can do 

it and come up with some rules that literally shut down power 

plants or raise the cost so high that again you get to this problem 

that consumers then would have 10 percent, 20 percent, maybe 

higher increases in their electricity rates. 

And I just hope that that would be a big part of the consideration 

too is the impact on consumers, especially poor people, when they 

are going to have to pay the bill. 

Mr. FRIEDMANN. Thank you again for that question. We really do 

understand the issues that consumers and the power generators 

share about concern about cost. 

Mr. SCALISE. I just hope EPA has that same concern, and I yield 

back the balance of my time. 

Mr. MURPHY. Gentleman yields back, and now to the gentleman 

from Mississippi who represents the third district, the home of 

Kemper plant, which we hope he invites this committee to. Mr. 

Harper is recognized for 5 minutes. 

41 

Mr. HARPER. Thank you very much, Mr. Chairman. I appreciate 

the opportunity, and certainly we are enjoying watching that massive facility being built in Kemper County, and as you know that 

is in my district in Mississippi. But it is clear others around the 

world are watching to see how this goes forward. If, as EPA says, 

this has all been done before, what is it about Kemper that makes 

it so important to the future of clean coal technology in this country and around the world? 

Mr. FRIEDMANN. Let me start by stating that there is just an immense body of evidence around the function, cost, likely future cost, 

and technology pathways, current performance and so forth for carbon capture and storage. That said, we have a special place in our 

hearts for the Kemper plant. In part because it is truly demonstrating a novel gasification technology, the TRIG gasifier at 

commercial scale, in part because it is testing a new business 

model, this co-location of mining, upgrading, and refining. 

Kemper is not just a power plant. It is basically a carbon refinery 

which sets out a number of products including ammonia, 

naphthenes, liquid fuels, as well as CO2 for enhanced oil recovery. 

That business model is every bit as important as the technical findings that we are going to get from this. 

Mr. HARPER. Mr. Klara, anything you would like to add to those 

remarks? 

Mr. KLARA. Well, I concur with that, but also just a couple comments on our demonstration program in general. My belief would 

be that none of these project developers, none of these companies 

came into this with their view of this is going to be a one-off, oneof-a-kind. And so a lot of business models certainly going into our 

demonstration program are indeed looking at replication of this 

technology at some point. 

Mr. HARPER. And that replication you would view as just in the 

United States or worldwide? 

Mr. KLARA. Well, if you look back to the history of things like criteria pollutants, NOx and SOx control that the United States 

showed technology leadership. And much of that technology is 

being deployed internationally. I would expect the same to occur 

with the development of carbon capture and storage. 

Mr. HARPER. And then Mr. Friedmann. 

Mr. FRIEDMANN. If I could add a little bit to that. 

Mr. HARPER. Yes, please. 

Mr. FRIEDMANN. Our conversations with Southern make clear 

that they very much see a Kemper 2.0 and a Kemper 3.0 and imagine some of those plants around the world where low-cost lignite 

is also available. 

Mr. HARPER. OK, and as you said the Kemper project works in 

this particular situation in Mississippi because of the TRIG technology, which gasifies local lignite coal and uses the carbon to increase nearby oil production. Where else in the world is there this 

sort of potential where you have a generation source no one would 

otherwise use and the CO2 can be used for oil production? 

Mr. FRIEDMANN. In the United States, we are looking all along 

the Gulf Coast, also in North Dakota in the lignite belt. Outside 

the United States, we are looking at Turkey. We are looking at 

inner Mongolia. We are looking at Kazakhstan. There are other 

42 

places where there are a combination of resources in the form of 

lignite and enhanced oil recovery opportunities. Pakistan is another one where one could imagine building a plant like this and 

reaping the commercial benefits. 

Mr. HARPER. You know, a few years ago, people were saying that 

there is nowhere near the capacity in enhanced oil recovery to take 

the output of the CO2 from a large part of the coal fleet. Now I am 

hearing some say that the capacity for EOR is growing substantially. But what is the potential for enhanced oil recovery in this 

country? And is there potential for this technology to grow particularly in light of recent advances in oil exploration and production? 

Mr. FRIEDMANN. Thank you. That is an excellent question. It also 

gives me the opportunity to acknowledge the outstanding work of 

Advanced Resources International here in Virginia, which has done 

a lot of this analysis. Indeed detailed characterization and assessments of fields in the United States and worldwide shows a much 

higher opportunity for enhanced oil recovery than previously recognized in the United States, well north of 60 billion barrels of potential additional recovery. Beyond that, we are seeing advanced technology and practice in enhanced oil recovery, in particular, looking 

at residual oil zone production as a further multiplier, possibly two 

to three times that much in the United States, creating the opportunity for hundreds of billions of barrels around the world. In all 

those locations, the primary limiting step is the availability of carbon dioxide for EOR. 

Mr. HARPER. Thank you both for being here, and, Mr. Chairman, 

I yield back the balance of my time. 

Mr. MURPHY. Gentleman yields back. Now go to Mr. Olson of 

Texas for 5 minutes. 

Mr. OLSON. I thank the chair, and welcome to Dr. Friedmann 

and Mr. Klara. Back home in Texas, we have a saying you probably 

have heard: ‘‘Always put the horse before the cart.’’ The research 

you all are doing with CCS is the horse that makes CCS viable in 

the free market. You are pulling the cart. Unfortunately EPA is 

using the research as a model for the entire country that CCS is 

viable. That is putting the cart before the horse. It is not viable. 

And, Dr. Friedmann, you testified with Ms. Schakowsky that 

your job is not to determine viability, just the science of it. I am 

glad to hear that. As she brought up, there are pockets of viability 

here in America for CCS. They are in Texas in my district outside 

of Houston. They are viable by using captured CO2 for enhanced 

oil recovery operations, EOR. EPA knows this. 

In the new plant rules’ impact analysis, here is a quote from 

EPA’s report. ‘‘The opportunity to sell the captured CO2 for EOR, 

rather than paying directly for its long-term storage, strongly improves the overall economics.’’ 

I was pleased to hear you mention Petra Nova. That is the Parish power plant in Needville, Texas. I can see that power plant 

walking out on my front lawn. It is one of the largest ones in the 

country, as you know. Four natural gas generators of power, four 

coal generators of power with the natural gas, the fifth one, coming 

online quickly. 

The plant sits on top of an old oil field, very close to it. They are 

planning to capture CO2 to use it to get oil, but their situation is 

43 

unique, and that is why it may be viable. There is another project 

in my district called Denbury Resources there in Alvin, Texas. In 

2001, they bought the Jackson Dome in Mississippi. As my colleague to my left, Mr. Harper knows, that is the largest natural 

CO2 deposit east of the Mississippi River. It is 98 percent pure 

CO2. 

With a massive pipeline infrastructure between their fires on the 

Gulf Coast, going up to New England, the eastern part of the 

United States, they have access to pipelines. They are shipping 

that CO2 from Mississippi down to Texas, the old Hastings Oil 

Field, and using that CO2 to get enhanced oil recovery operations. 

My question is, is it fair to say there are few situations like Parish and Denbury. Now, most states have little opportunity, no 

chance for enhanced oil recovery operations inside their borders. 

Mr. FRIEDMANN. Thank you. I am happy to answer that question 

having spent happily 5 years living in Texas myself, I am sure you 

are familiar with the saying you don’t want to be all hat, no cattle. 

Mr. OLSON. Yes, sir. 

Mr. FRIEDMANN. And we view our job in that context. CCS, in 

particular enhanced oil recovery, we view as the bridge to the 

bridge of the future. That if we are building a bridge through CCS 

deployment to a clean energy future, then EOR is an important 

bridge to that bridge. There are a couple of important benefits that 

come from EOR early deployment. 

The first of these is that you actually get to build the plant. That 

is the critical increment that leads to reduced costs widely. In order 

for us to see a viable future for CCS widely deployed, we believe 

that the cost must come down broadly. That means building plants 

and demonstrating how and learning how to reduce those costs. 

The EOR projects give us those first-of-a-kind opportunities to figure out how to do that. 

The second thing I would add is that there may be more of those 

opportunities than initially recognized. Per my last comments to 

Mr. Harper, it is looking like these residual oil zones are more 

broadly distributed than originally understood, and that provides 

more opportunity nationwide. 

We are also seeing projects like the Boundary Dam Project in 

Canada, which is a post-combustion capture project like Petra 

Nova’s project where they are taking CO2 by pipeline to the Midale 

Field in Saskatchewan. And they have also learned enough from 

doing that first project that they are preparing to commit to a second project to do the same thing. Where those EOR opportunities 

exist, we believe it is critical to anchor early projects to reduce the 

total cost to the taxpayer, to increase the viability of the projects 

and to harvest the key learnings that we need to see CCS widely 

deployed. 

Mr. OLSON. Yes, so it sounds like they are rare. You have to have 

some sort of confluence with power generation with some sort of 

structure near the power generation to get the CO2 to use for enhanced oil recovery operations. I am out of my time. I just want 

to invite you back to Texas. You know, you will have your term up 

in DOE next 4 years probably. Come back to The Woodlands. You 

know, ExxonMobil, your former company, has built a big research 

44 

center up there. The one from Fairfax, Virginia is moving to Texas. 

So come on back. I yield back. 

Mr. MURPHY. The gentleman yields back. Now recognize Mr. 

Griffith from Virginia for 5 minutes. 

Mr. GRIFFITH. Thank you very much, Mr. Chairman. I do appreciate it. I have in my all-of-the-above policy, I have the four Ds, dig, 

drill, deregulate, and discover. Today’s hearing obviously deals with 

discover. I do appreciate the work that you all are doing in trying 

to find ways that we can discover ways that we can continue to use 

coal because I come from a coal mining region in central Appalachia. 

That being said, I have been very excited about the work that 

has been done by Dr. Fan at Ohio State University in regard to 

chemical looping, and as I understand it, last time I talked to him, 

he hadn’t yet gotten the keys to the facility in Wilsonville, Alabama, but he was expecting to get that soon. 

My question is, because I see that is so exciting because we end 

up with, I guess, whatever remnants are left over what is a very 

pure burning process of the coal ash and carbon dioxide. So we 

eliminate most of the cost of the capture. So let us assume for the 

sake of argument that it is successful, and we get to September 

and the experiment has worked as well as all of us could hope. 

What is next? Where do we go? And what does DOE do? And I appreciate NETL has been involved in this project and I appreciate 

that. 

But what do you all do next to try to encourage industry to go 

to an even larger project and actually build a plant that would use 

this technology that doesn’t have to be near lignite alone or any 

particular type of coal but could be used anywhere in the United 

States or the world. 

Mr. FRIEDMANN. Again, thank you for that question, and again 

because Mr. Klara’s organization does so much of that, I will make 

sure he has time to answer in part. Chemical looping technology 

is an example of what we would call a second generation technology in these different buckets. The work that is going on in Ohio 

is very exciting. We have another chemical looping project as well 

with Austin in Connecticut. And in fact, we are in discussions right 

now with ARPA–E to take over that project and to see if we can’t 

set it up at Wilsonville and give it a run. 

There are a series of technical challenges that come with association of scale-up demonstration and so forth. But I do want to mention that one of the interesting values of chemical looping is that 

it is actually a dual technology. It can be used on coal feed as well 

as on natural gas. 

Mr. KLARA. And I would just like to add that we are doing everything we can to push that technology forward. 

Mr. GRIFFITH. Well, and I guess my question is that assuming 

that it goes well, do you all think you are ready to step in and say 

OK, we will help fund this at some plant because we really need 

some help in the coal fields? And I see this as the light at the end 

of the tunnel. I don’t see how it can possibly be done in less than 

7 years, and that is with the government using the money that it 

has to take this discovery and make it real for people where we 

45 

don’t raise the cost of electricity to where people can’t afford it and 

we continue to use the rich coal resources of central Appalachia. 

Mr. KLARA. I began this job just 3 months ago, and in that context, we are considering exactly what pieces we need to build into 

our research portfolio. One thing that we have begun to realize is 

that we need second generation large pilot projects as the critical, 

technical undergirding of those next generation of large demonstrations. We are trying to put together the technical considerations 

and specifications in partnership with NETL to figure out what 

that will look like in terms of technical work, milestones, and costs 

so that we can bring forward those proposals in future budgets. 

Mr. GRIFFITH. I appreciate that. I am concerned that we do have 

the cart before the horse, and I appreciate what you all are doing 

moving forward. But I do think that some of the regulations coming out of your sister agency, not you all, but out of your sister 

agency, are making it hard for people to survive in the coal industry when we see technology coming down the pike that may very 

well solve the problems that a lot of times we hear of people bringing up in regard to the use of coal. 

I would have to say in September of 2012 testimony before the 

Energy and Power Subcommittee, a representative from Austin 

who you mentioned earlier, a maker of CCS-related technology, 

said that it is unaware that any supplier of CCS technology is 

ready or able to offer commercial guarantees for full-scale systems 

of carbon capture. What does a technology supplier need to know 

to warrant and be ensured for its CCS technologies for use in a coal 

power plant? 

Mr. FRIEDMANN. Thank you. Since that time, a number of those 

companies have actually do now offer performance guarantees. In 

part, that is because we have run these large scale pilots that they 

need to validate their technology. And more importantly they have 

had installation in some of these large-scale demonstrations. That 

helps provide the confidence along with other technology tools like 

advanced simulation to allow them to put a performance guarantee 

in a wrapper around those facilities. 

Mr. GRIFFITH. All right, I appreciate that. Thank you very much. 

I yield back the remainder of my time, Mr. Chairman. 

Mr. MURPHY. Mr. Johnson, you are now recognized for 5 minutes. 

Mr. JOHNSON. Thank you, Mr. Chairman and gentlemen, thank 

you for being here with us today. I represent a part of our nation 

in eastern and southeastern Ohio that is very dependent upon the 

coal industry, both for the energy that we use and also for the livelihood for the people that work in the industry. So let me ask you 

a quick yes-or-no question to get started off right away. Do both of 

you believe that America can solve the technological concerns that 

the environmentalists have so that we can use and continue to use 

coal environmentally soundly? Just a quick—— 

Mr. FRIEDMANN. Unquestionably yes. 

Mr. KLARA. Absolutely. 

Mr. JOHNSON. And do you believe that coal and the vast resources of coal that we have should comprise a significant part of 

our energy portfolio moving forward? 

Mr. FRIEDMANN. Yes, I do. 

46 

Mr. KLARA. Yes. 

Mr. JOHNSON. OK, well thank you. Then let me get into some 

specific questions. In December 2010, the DOE and NETL issued 

a CCS research development and demonstration roadmap. Among 

the goals of that roadmap was that the DOE would develop technologies that can separate capture, transport, and store CO2 using 

either direct or indirect systems that result in a less than 10 percent increase in the cost of energy by 2015. When does DOE and 

NETL anticipate demonstrating CCS systems that result in less 

than 10 percent increase in the cost of energy compared with the 

non-CCS coal-powered plants? 

Mr. FRIEDMANN. Thank you again for that question. The issues 

of cost is just forward in our minds, and we are doing everything 

we can to reduce it. In that context, we again see sort of a 2025 

timeline for this second generation of technologies to lead to 10 or 

15 or 20 percent cost of electricity increases that are retail cost. 

Mr. JOHNSON. OK, Mr. Klara, any comments? 

Mr. KLARA. Correct, and I just say that relative to our technology 

portfolio, that those technologies are in our transformational bucket of technologies. And yes, the 2025 to 2030 timeframe is the current pathway. 

Mr. JOHNSON. OK, your technology assessment published about 

a year ago suggests the three technologies which include sorbents 

and pre-combustion membranes that may help achieve the goal are 

only at the concept stage. Would you say that your plans of December 2010 are still on target? 

Mr. FRIEDMANN. Yes, absolutely. In fact, we have seen great 

progress on a number of those which at the time were sort of leading technologies, things like advanced membranes, everything from 

oxygen separation membranes to CO2 separation membranes. The 

money that we have invested has allowed those to go from sort of 

bench scale to small pilot testing and in one or two cases to large 

pilot testing. That is part of the pipeline and the pathway to that 

large scale commercialization. 

Mr. JOHNSON. OK. 

Mr. KLARA. Yes. 

Mr. JOHNSON. Same thing? Over the past several years, the 

president’s budget request for coal R&D funding has steadily declined from a request in fiscal year 2010 for $404 million to the 

most recent request in fiscal year 2014 for $277 million. Congress 

did not agree with these levels of funding and recently passed an 

omnibus appropriations bill increasing the funding by more than 

$100 million. So what does this say about your department’s aggressive planning and the administration’s priorities to advance 

coal technology if you are cutting funding for this work? 

Mr. FRIEDMANN. Thank you again for that question. We recognize that the budget process is complicated, that there are many, 

many competing interests, and so we make our requests. And we 

make our recommendations to the secretary, and the secretary 

brings those to OMB and to the White House. And together they 

figure out what is in fact what they want to put into an omnibus 

budget. 

47 

I would say that in general I think about these kinds of questions as a tradeoff with urgency. The more urgency one has, the 

more one is willing to spend on any particular issue. 

Mr. JOHNSON. I understand the budget process, and I realize 

there are conflicting priorities. But do you agree with the additional funding levels that Congress has appropriated? 

Mr. FRIEDMANN. What I would say is that we have very clear 

ideas about how we would use that well. 

Mr. JOHNSON. Good, because that was my last question. And I 

am sorry. I got 15 seconds so let me get that one in. Would you 

please submit to this subcommittee how you plan to spend this additional funding? 

Mr. FRIEDMANN. Yes, we will be happy to take that question for 

the record—— 

Mr. JOHNSON. OK. 

Mr. FRIEDMANN [continuing]. And to have follow up with additional meetings. 

Mr. JOHNSON. All right, thank you. Mr. Chairman, I yield back. 

Mr. MURPHY. The gentleman yields back. I now recognize the 

gentlelady from North Carolina, Ms. Ellmers, for 5 minutes. 

Mrs. ELLMERS. Thank you, Mr. Chairman. And thank you to our 

panel. Dr. Friedmann, as I understand it, without government subsidies, and I think you have already mentioned this, the CCS demonstrations for coal plants would not be going on. Is this correct? 

Mr. FRIEDMANN. Yes, that is correct. 

Mrs. ELLMERS. OK, can you briefly describe to me the taxpayers, 

how I could go home to my North Carolina taxpayers and explain 

to them what return they are getting for these subsidies and technology development? 

Mr. FRIEDMANN. There is a handful benefits that come forward 

that I think are pretty clear. In the near term, we actually get advanced technology that can be used to underlie manufacturing in 

the United States. Another thing I would say is that we actually 

bring a lot of information back to the body public, scientific, technical engineering, and business information, economic information, 

which is used to make important investment decisions in the 

United States. 

I would add that our enhanced oil recovery projects provide two 

additional benefits. One of those is with additional secure U.S. oil 

supply. And the third is actually with the tax revenues from that. 

Something that is lost by many people is that the additional tax 

returns on enhanced oil recovery actually pay for all of the government investment in a span of 7 to 8 years. After that, it is actually 

net revenue positive. 

Mrs. ELLMERS. So in my understanding, and assuming that the 

success of the first generation technologies does take place, there 

really will not be wide commercial use of these things until the 

2020s. Is that correct? 

Mr. FRIEDMANN. For widespread commercial use, yes, that is correct. 

Mrs. ELLMERS. For widespread. So is this why the DOE’s fiscal 

year 2014 congressional budget states, and I am quoting, ‘‘in the 

case of electricity generation first generation CCS technology, cost 

48 

is not expected to be low enough to achieve widespread deployment 

in this near term’’? 

Mr. FRIEDMANN. Yes. 

Mrs. ELLMERS. Yes, OK. So now being that that is correct, at a 

coal gasification facility, the cost of electricity may be increased by 

40 percent? Is this with the current carbon capture and compression technology, is this—— 

Mr. FRIEDMANN. For the first generation technologies, yes, that 

is correct. 

Mrs. ELLMERS. So there will be a 40 percent increase? 

Mr. FRIEDMANN. Where deployed. 

Mrs. ELLMERS. Where deployed. And at a pulverized coal plant, 

this cost of electricity increases up to 80 percent? 

Mr. FRIEDMANN. Yes, that is correct. 

Mrs. ELLMERS. That is correct. What size commercial development for coal plants does DOE think is possible with current CCS 

technology given its highest costs? 

Mr. FRIEDMANN. I am sorry. One more time. I just didn’t get 

that. 

Mrs. ELLMERS. What size commercial deployment for coal plants 

does DOE think is possible with current CCS technology given its 

high cost? 

Mr. FRIEDMANN. At this point, it would be niche applications. 

There will be a couple of places in the country, as we heard from 

Mr. Olson—— 

Mrs. ELLMERS. OK. 

Mr. FRIEDMANN [continuing]. Where you have the correct confluence of opportunity, resource, and revenue. 

Mrs. ELLMERS. Just and there again, and I am probably just asking you to speculate on this. But how many would you say that 

would be? When you say niche, are we talking about a small—like 

one to five? 

Mr. FRIEDMANN. Maybe a few dozen. 

Mrs. ELLMERS. A few—OK, so 24—— 

Mr. FRIEDMANN. But I would not consider that widespread. 

Mrs. ELLMERS [continuing]. Across the country about. 

Mr. FRIEDMANN. Just kicking around numbers, sure. 

Mrs. ELLMERS. OK, that is good, and I appreciate that. Thank 

you very much. Mr. Chairman, I yield back the remainder of my 

time. 

Mr. MURPHY. Thank you. Now I recognize Mr. Long for 5 minutes. 

Mr. LONG. Thank you, Mr. Chairman, and thank you all for 

being here today and your patience so far. Mr. Klara, has the Department of Energy estimated how many billions of tons per year 

will need to be stored if the United States is to sequester a substantial portion of coal-based carbon dioxide? 

Mr. KLARA. There are many estimates that are out there relative 

to what the future could be for CO2 production. 

Mr. LONG. Many estimates from the Department of Energy? 

Mr. KLARA. We rely mainly on estimates from others. So for example the Intergovernmental Panel on Climate Change, the Electric Power Research Institute has looked at these. 

49 

Mr. LONG. Do you know a ballpark range on how many billions 

of tons they are talking about? Have you looked at any of that or 

not? 

Mr. KLARA. Well, some of the estimates, and we could give you 

specifics for a record, question for the record. But some of the specifics would be looking at CCS having to handle potentially 20 percent or more of the reduction needed to get the CO2 stabilization. 

And yes, that could be in the range of a billion tons or more. 

Mr. LONG. Billion or multiple billions? 

Mr. KLARA. I would have to go back and look. 

Mr. LONG. OK, if you wouldn’t mind if you could get that for my 

staff, I would appreciate it. 

Mr. KLARA. Yes. 

Mr. LONG. And, Dr. Friedmann, I would like to draw your attention to this major CCS, which is carbon capture and sequestration 

demonstration projects, project locations, and cost share. This is a 

document that you all provided to the committee, is it not, in your 

packet? 

Mr. KLARA. Yes, sir. 

Mr. LONG. OK, I heard it recently mentioned that there are several capture and storage projects that are up and running now. 

There has been a lot of discussion on that here today. And yet from 

this graphic that you all provided, almost all these projects displayed have start dates that are a few years down the road, 2017, 

estimated start dated 2017, 2019, 2016, 2012, 2017, 2014, and 2015 

which are all, as I say, down the road. And according to a recent 

congressional research report on carbon capture and sequestration, 

the Department of Energy has spent approximately $6 billion on 

CCS since 2008, most of which came from the stimulus bill that 

was passed a few years ago. And according to the capture, transport, and inject industrial scale, quantities of CO2 solely for the 

purpose of carbon sequestration. Can you clarify one final time, I 

guess for the committee, why we are hearing different things in the 

sites and if you could cite any commercial scale carbon capture and 

sequestration projects that are currently now up and running generating electricity. 

Mr. FRIEDMANN. Right, again so to clarify, there are a number 

of large-scale industrial facilities operating in the United States 

and around the world. There are 12 large projects which the Global 

CCS Institute recognizes. With respect to power generation, the 

closest fit is the Beulah, North Dakota plant which generates synthetic natural gas. That gas goes into the pipeline and is used to 

generate power. It is not a power plant per se. It is the synthetic 

natural gas facility. 

Mr. LONG. It is a synthetic natural gas facility? 

Mr. FRIEDMANN. Yes, it was built actually in the early 80s when 

there was an expectation that we would have decreased production 

of natural gas in the country and we needed to generate synthetic 

natural gas. That plant is—— 

Mr. LONG. They kind of missed their bet there, didn’t they? 

Mr. FRIEDMANN. One of the reasons why we do everything we do 

is that the future is opaque, and it is important to prepare as many 

options for the market as possible. 

50 

Mr. LONG. That is why I think that the private sector should be 

involved in more of this than the government, but I will stick with 

you, Dr. Friedmann. Does the Department of Energy intend to intervene to make sitting pipelines for distant carbon injection a 

more realistic option? I understand this has been a barrier to some 

utilities who want to pursue CCS projects. 

Mr. FRIEDMANN. What I can say is that we have—so for any 

project that we have been involved in, we have supported the development and deployment of those pipelines. Where we see opportunities for regional networks to emerge that would help anchor 

CCS industries and large coal projects, we are keenly committed to 

seeing those pipelines come forward. One example of this is actually the support we have given to the FutureGen project in the 

FutureGen Alliance and their efforts to build a pipeline within Illinois. 

Mr. LONG. OK, and, Mr. Chairman, I yield back and thank you 

all again for my time. 

Mr. FRIEDMANN. Mr. Chairman, if I can clarify something for the 

record. 

Mr. MURPHY. Yes. 

Mr. FRIEDMANN. Thank you. This actually had to do with respect 

to Representative Ellmers’ questions. She was asking about the 

price of capture. The answers which I gave were for a high fraction 

of capture, basically 90 or 95 percent capture. At small fractions of 

capture, say 50 percent capture, the actual integrated cost is much 

less. And that is relevant with respect to how you can deploy either 

modular units or smaller fractions of capture on the new or existing fleets. 

Mr. MURPHY. Is that a reference to a question about the 40 percent increase in costs? 

Mr. FRIEDMANN. Yes, exactly. 

Mr. MURPHY. Do you have the information, or can you provide 

it for this committee in addition to her question about what this 

breaks down to in a cost-per-megawatt generation and what this 

would then cost the average family? Do you have that information 

now, or is that something you can get to us? 

Mr. FRIEDMANN. We prefer to bring that to you as a question for 

the record and give it back to the committee later. We have made 

many of those kinds of calculations. Again it is the excellent work 

of National Energy Technology and their assessment team have 

done that for a wide range of power plants, a wide range of technologies, and a wide range of fuel prices. We are happy to provide 

that to the committee. 

Mr. MURPHY. That would help the committee and the families 

who are trying to pay attention to this and see what this means. 

Mr. FRIEDMANN. Of course. 

Mr. MURPHY. I now recognize Mr. Gardner for 5 minutes. 

Mr. GARDNER. Thank you, Mr. Chairman, and I thank the witnesses for joining us today. Mr. Klara, is it correct that successful 

development and deployment of second generation technologies are 

aware the Department of Energy expects the cost savings that may 

help make CCS for coal power competitive in the marketplace? 

Mr. KLARA. I mentioned earlier, but we have three buckets of 

technologies that we are going after. First generation, which is the 

51 

technologies deployed now. Second generation is what you are referencing, and then we have transformational technologies. And 

with second generation technologies, we are headed toward a reduction in cost as indicated by your remark. 

Mr. GARDNER. And what is NETL’s assessment of the readiness 

of the technologies most critical to driving down costs? 

Mr. KLARA. Certainly when it comes to carbon capture and storage, capture is by far the key element to drive the cost down, and 

that is the majority of the focus of our research program. 

Mr. GARDNER. Have any of these second generation technologies 

have been taken to the demonstration phase to validate they work 

at commercial scale in a coal-fired power plant? 

Mr. KLARA. Not at this time, second—— 

Mr. GARDNER. Not at this time? 

Mr. KLARA. Yes, so demonstration of those would be part of your 

planning. 

Mr. GARDNER. Dr. Friedmann, about how much of DOE’s $7.6 

billion over the past decade has been dedicated towards the second 

generation technologies? 

Mr. FRIEDMANN. The overwhelming majority of the $7.6 billion 

that we have dedicated so far is actually to the large-scale commercial demonstrations. So, but in that context, to generate and develop the second demonstration technologies, as you said, we have 

put already several hundred millions of dollars into that research 

effort. 

Mr. GARDNER. OK, and the information that I have says that we spent around $3 billion towards the second generation technologies. 

Would that be correct, of the $7.6 billion? 

Mr. FRIEDMANN. No, I don’t think that is correct actually. 

Mr. GARDNER. OK, maybe we can get—— 

Mr. FRIEDMANN. We would be happy to clarify that. Yes, sir. 

Mr. GARDNER. When do you expect demonstrations of these second generation technologies will be completed? 

Mr. FRIEDMANN. The question is actually how quickly can we 

pilot them first. That is the critical lynchpin. Once they have been 

piloted at, say, that 20- to 50-megawatt scale, then the next step 

is commercial demonstration. 

Mr. GARDNER. OK, and how long until pilot? 

Mr. FRIEDMANN. One of those technologies is in fact being piloted 

now. For most of them, it is a question of how quickly can we put 

together the project. 

Mr. GARDNER. OK, and so major scale, that is 20 to 50—what did 

you say 20 to 50? 

Mr. FRIEDMANN. We are looking for—the soonest that we could 

get a second generation pilot up would be in 2015/2016 kind of 

timeline for solicitation, maybe 2018 demonstration, and then 

large-scale demonstrations of those technologies between 2018 and 

2025. 

Mr. GARDNER. OK, and do you or Mr. Klara have an estimate for 

when those technologies will be available commercially, warrantable, insurable, fundable on the open market? 

Mr. FRIEDMANN. For the second generation technologies, again, 

you need to have the large-scale pilots before they can get to a warranty stage. 

52 

Mr. GARDNER. And you said around 2022 would be about when 

they get to demonstration? 

Mr. FRIEDMANN. You might be able to do things sooner than 

that. I would point actually to an existing program we have under 

our cross-cutting budget line which is the carbon capture simulation initiative in which we are trying to use advanced super-computing technology to accelerate the sureness by which companies 

can provide those kinds of performance guarantees. 

Mr. GARDNER. So would it be safe to say that we are looking at, 

based on current cost estimates, commercially warrantable, insurable, and fundable on the open market, we are looking at around 

2030 or so, maybe beyond that? 

Mr. FRIEDMANN. Sooner than that, but 2020 to 2025 timeframe, 

yes. 

Mr. GARDNER. OK, can you describe in lay terms what the scale 

of cost savings will be expected for the so-called second generation 

technologies? 

Mr. FRIEDMANN. To a first cut, we expect the cost to cut in half. 

We expect them to come in at something like $40 to $60 a ton for 

an integrated system. 

Mr. GARDNER. And you are also working what you call transformational technologies. What would be the cost savings of these 

expected transformational technologies? 

Mr. FRIEDMANN. Again, on a thermodynamic and an engineering 

basis, they can get maybe another $10, another $15 a ton cheaper. 

So something on the order of $30 a ton is probably about the limit 

of what you can reasonably expect. 

Mr. GARDNER. And so when do you expect the demonstrations of 

those transformation technologies to be completed? 

Mr. FRIEDMANN. Again we have laid out our road map, and we 

are hoping to see those deployed in the field by 2025. 

Mr. GARDNER. OK, deployed in the field commercially? 

Mr. FRIEDMANN. Yes. 

Mr. GARDNER. OK, at what price of CO2 capture per ton or percentage of capture will the cost be low enough to put a system on 

a level playing field economically with traditional coal-fueled electrical power production? 

Mr. FRIEDMANN. I honestly don’t understand your question. 

Mr. GARDNER. So basically at what, the price point, the break 

point of CO2 capture per ton or percentage of capture will the cost 

be low enough? Basically when will this be economic, low enough 

to put a system on a level playing field economically with traditional coal-fueled electrical power production? 

Mr. FRIEDMANN. It is my contention that the second generation 

technologies are going to be the clean energy choice in terms of a 

competitive market in a variety of markets. In some markets, they 

won’t be. In some markets, they will be. And the transformational 

technology would just increase the market share at that time. 

Mr. GARDNER. But in terms of the cost, putting it on a level playing field from where we are today with costs from where you want 

to be with these new technologies cost. Do you have estimates? 

Have you produced estimates and that will produce estimates of 

when this break point will be? 

53 

Mr. FRIEDMANN. Again all environmental technologies add cost. 

So it is not appropriate nor do we for the purpose of policy decision 

compare the cost of carbon capture and storage with an 

unretrofitted plant or with a new build plant without it. We do that 

to demonstrate the delta, but a clean plant is not comparable to a 

Dickensian plant. They are different things. 

Mr. GARDNER. OK, if you could supply any cost estimates that 

you have made, comparisons to the committee, that would be fantastic. And have any of your estimates changed in light of current 

market conditions? 

Mr. FRIEDMANN. First of all, we are happy to provide those numbers. The market conditions are constantly changing. We actually 

try to bring that uncertainty into the way that we make our price 

calculations in terms of availability for labor, availability for materials, global markets for things, and so forth. In that context, as 

the market has changed, our estimates don’t change as much as 

you might guess. Some of that information is baked into the way 

we do the calculations. 

Mr. GARDNER. Thank you. And thank you, Mr. Chairman, for 

being generous of time. 

Mr. MURPHY. Thank you, and although we are done, I am going 

to recognize Ms. Schakowsky for a quick clarifying question, comment, and then I will have a final clarifying question. 

Ms. SCHAKOWSKY. Thank you, Mr. Chairman. First, I want to 

say, Dr. Friedmann, you are one of the best witnesses that I have 

heard before this committee, and your answers are informative and 

concise and I think very fair. And I appreciate that. I hope I speak 

for the rest of the committee. When we talk about the cost of CCS 

and you estimate that, I just wanted to clarify, you aren’t considering that at some point there may be a cost for carbon emissions. 

I know that the major oil companies have already built into their 

business plans that there may at some point in the not-too-distant 

future be some sort of perhaps a carbon tax, some sort of cost. So 

when you estimate the cost of this technology and applying it primarily we are talking about to coal today, you aren’t taking into 

consideration any kind of cost for the pollution that these plants 

produce, are you? 

Mr. FRIEDMANN. Let me take just a minute to answer that if I 

may. 

Ms. SCHAKOWSKY. OK. 

Mr. FRIEDMANN. Again, thank you for the question and for your 

compliment. It was very nice of you to say so. Shell Oil Company 

has announced that they use a $50-a-ton estimate for carbon dioxide for any project that they put together. Other companies, most 

Fortune 500 companies have a similar kind of number which they 

keep in terms of how they assess risk in a carbon-constrained future. 

We do not actually use those numbers to estimate cost of capture. Those are straight-up technical calculations based on the facility, the technology, the rank of coal, et cetera. What we do is we 

think about deployment in the context of those costs. Cost of carbon 

is something which is actually outside of what the Department of 

Energy does, but we do believe that we are in a carbon-constrained 

54 

world and that increasingly the cost of carbon dioxide emissions 

will be internalized into the cost of doing business. 

As that happens, it is our privilege and our pleasure and my passion to find ways to drop the cost so that that deployment of clean 

energy technology can be as widely successful as possible to create 

the brightest possible clean energy future for the United States. 

Ms. SCHAKOWSKY. Perfect ending as far as I am concerned. 

Thank you. 

Mr. MURPHY. Thank you, and I have a clarifying question here 

too. So you mentioned about Kemper. They have that advantage of 

being able to use enhanced oil recovery from their plant. Different 

coal plants around the nation may not have that same advantage. 

And as you were preparing information for us, would you let us 

know what you believe the costs are for new plants or retrofitting 

old plants? 

Mr. FRIEDMANN. Yes. 

Mr. MURPHY. Give us some comparisons and having that public 

because we would like the companies themselves to be able to respond to those estimates if you would be able to get that for us. 

Mr. FRIEDMANN. Yes, we would be happy to. 

Mr. MURPHY. Thank you. 

Mr. FRIEDMANN. Let me add that the availability of EOR doesn’t 

affect the cost of the project. It affects the revenue, and so that of 

course affects the economics. But we try to keep the revenues and 

the benefits and the costs in separate categories for exactly that 

kind of comparison. 

Mr. MURPHY. Thank you. And also for the sake of the American 

people, to help us translate that into what is going to be the cost 

for homeowners in order to make these kind of transitions as well 

as for businesses so we all share a concern that energy cost increasing means the impact upon manufacturing. We see that affecting some countries in the EU as well. 

So thank you, and I echo the comments of Ms. Schakowsky. Dr. 

Friedmann and Mr. Klara, you have been very informative. We appreciate just giving us the facts. That was very helpful and will 

help us move forward. So I want to thank both the witnesses that 

participated in today’s hearing and remind members they have 10 

business days to submit questions for the record, and I ask you to 

respond to questions promptly. And we will leave it at that. So 

with that again I thank the panel, and this hearing is adjourned. 

[Whereupon, at 12:03 p.m., the Subcommittee was adjourned.] 

[Material submitted for inclusion in the record follows:] 

PREPARED STATEMENT OF HON. FRED UPTON

This hearing continues the committee’s ongoing oversight of the Department of 

Energy, and the status of its work to develop technologies that will help advance 

cleaner and more efficient electricity production from coal-based power generation. 

For several decades, Congress has entrusted DOE through appropriations and legislative direction to help advance the technologies that will dramatically improve 

how we use our abundant coal resources to the benefit of the American economy. 

With its vast scientific, technical, and engineering capabilities, DOE continues to 

have great potential for helping to promote cleaner, less expensive electricity production. 

DOE also plays a central role coordinating the nation’s energy policy and is most 

directly responsible for ensuring America has a secure, affordable, diverse, and reliable energy supply. 

55 

So our oversight of DOE should help illuminate two issues. 

One involves the agency’s stewardship of the taxpayer funding Congress has provided the agency to pursue clean coal technologies. In addition to nearly $3.5 billion 

in Recovery Act funding, the agency has been provided an average of $350-$400 million dollars annually over the past decade to pursue important answers about carbon capture and sequestration technologies for coal-based electricity generation. 

According to DOE’s program plans, the purpose of this research is to develop 

workable and less expensive CCS technologies, and to introduce new efficiencies 

that will benefit any type of coal generation systems. But DOE’s own plans expect 

this will take decades to prove. We have a responsibility on this committee to ensure 

the groundbreaking work we entrust DOE to pursue is on track and not sidetracked 

by rushed decision-making or shortsighted policy initiatives that threaten meaningful technological progress. 

Secondly, we also must work to spotlight how DOE is performing its role in the 

nation’s energy policy making. Over the past five years, we have witnessed an onslaught of EPA rules and proposals that have significantly affected or threaten to 

affect the nation’s ability to provide a diverse and abundant supply of electricity. 

At the same time, assumptions about the relative economic potential of various 

sources of energy have shifted over the past decade, with the newfound abundance 

of natural gas. This is raising new challenges and opportunities for an abundant energy future. 

It is not yet clear whether DOE is really in the driver’s seat or taking a backseat 

to EPA on the policy or the technology matters that may have a direct impact on 

our national energy policy. So as we conduct our oversight, we should be mindful 

of and think about whether, in fact, DOE is truly up to the task, given existing authorities, for guiding policy and providing the research to support a secure energy 

future. 

# # # 

PREPARED STATEMENT OF HON. G.K. BUTTERFIELD

Each year the science of climate change is reinforced. How much more proof is 

needed for my Republican colleagues to accept reality and acknowledge that humans 

contribute to climate change? 

The number and intensity of severe weather instances are increasing according 

to NOAA. Science continues to point out the human impact on severe weather. My 

constituents in eastern North Carolina were hard hit by Hurricanes Irene and 

Sandy. A 15 year old girl in Goldsboro and a man taken in his home by a felled 

tree were amongst several North Carolinians who lost their lives. 

I would be remiss if I failed to mention the third largest coal spill in our nation’s 

history which occurred in Eden, North Carolina on February 2nd. The spill jeopardizes the drinking water of North Carolinians and the ecosystem of the Dan River 

and Lake Gaston. We must keep in mind the impacts on those in close proximity 

to power plants and their coal ash ponds, many of which are in low-income communities and communities of color. 

The President’s Climate Action Plan will help our nation reduce our contribution 

to climate change. It is a decisive step toward creating new energy jobs and being 

innovative instead of remaining complacent. I look forward to working with all 

stakeholders to find sensible and affordable ways to reduce climate change. 

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