Without the support of federal subsidies, new coal-fired power plants with carbon capture and sequestration (CCS) technology are unlikely to be built in the US – despite new environmental regulations that seem to benefit such technology, according to a Bloomberg Government report.
New coal plants would effectively be banned under the new source performance standard (NSPS) proposed by the US Environmental Protection Agency (EPA) last month because their emissions rates are almost double that of the proposed standard, according to the report.
The proposed NSPS was thought to be favourable for investments in CCS technology as a way to build new coal plants that could comply with the regulations, but this is unlikely to occur given the economics of the technology, says the analysis.
Coal-fired generation with CCS is almost 50% more expensive than from without the technology, and about twice as expensive as natural gas-generated electricity, according to estimates by the US Energy Information Administration (EIA).
“It’s a technology that’s just way out of the money,” said Rob Barnett, a Washington, DC-based energy analyst with Bloomberg Government. “I think the hurdle goes beyond basic [research and development]. There’s only so much you can do to improve the cost and technology profile. Right now, the technology is so out of the money, it would require more support than demonstration and early pilot projects.”