Department of Energy suspends FutureGen project in Illinois, withdraws $1 billion in funds

Associated Press

The Department of Energy announced Tuesday that it has suspended the long-planned FutureGen clean-coal project in western Illinois.

The department concluded the project couldn't meet a September deadline to use its $1 billion in federal stimulus funding, DOE spokesman Bill Gibbons told The Associated Press.

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The FutureGen Alliance, the group of coal companies working with the government on the project, has no choice but to shut down, said spokesman Lawrence Pacheco. Without the federal funding there isn't enough money to finish the $1.65 billion project.

The plan was to refit a coal-fired power plant near Meredosia in western Illinois and store carbon dioxide from the coal underground.

An earlier version of the project was dropped by the administration of President George W. Bush due to costs.

As recently as last September, the project reached what the FutureGen Alliance called a major milestone when the U.S. Environmental Protection Agency issued permits for FutureGen to start storing carbon underground.

But the project has a long history of stops and starts.

First proposed by the Bush administration, the project initially called for building an experimental power plant in eastern Illinois. But the Bush administration pulled the plug on that version of the project, citing rising costs.

The current version of FutureGen, dubbed FutureGen 2.0, was first planned after President Barack Obama took office. The scaled-down project was promised $1 billion in federal stimulus funding.

Along the way, the FutureGen Alliance has lost a number of its members, including several power companies.