The “Coalfleet for Tomorrow” project was undertaken by the EPRI in conjunction with several coal-fired power generating bodies. The analysis study is part of the project’s initiative to make advanced coal technologies good investment opportunities while providing environmental sustainability.

IGCC combines high-efficiency gas turbine power with coal use, using carbon capture and storage capabilities to prevent the release of harmful emissions such as mercury, sulphur and nitrogen oxides. The study by EPRI showed that no single incentive could cover the cost gap between standard coal plants and IGCC plants but recommended that tailored packages of incentives could encourage their deployment.

With two demonstration IGCC plants for observation, the EPRI indicated there would be a 15-20% increase in cost for electricity generated from the next few IGCC plants over that from conventional coal plants, half from higher technical risks and half from higher capital costs.

It recommended that experience from the operation of future plants would close this cost gap to allow wider deployment. But it also suggested offering federal incentives such as tax-exempt financing, accelerated depreciation, federal cost-sharing grants, production tax credits and direct federal loans to the initial few plants to jump-start the uptake of the technology.

EPRI concluded further analysis was needed to examine additional incentives and the financing and deployment of a broader range of advanced coal technologies for the industry’s future.