Sep 29 - Business Wire

GE Energy, Bechtel Power and American Electric Power (AEP) took a critical step today toward construction of what would be the first integrated gasification combined cycle (IGCC), or cleaner coal, power plant in the United States in nearly 10 years.

GE Energy and Bechtel signed an agreement today with AEP to proceed with the front-end engineering design (FEED) phase for a proposed commercial, 629-megawatt IGCC plant. The FEED process is expected to take 10 to 12 months. Procurement and construction would begin after certain milestones are achieved over the next year. Target for commercial startup of the new IGCC plant is 2010.

AEP, the nation's largest electricity generator, would own and operate the plant, to be built at a site in Meigs County, Ohio, if AEP receives regulatory recovery from the Public Utilities Commission of Ohio.

The new AEP facility would be the first commercial-scale, IGCC plant built in the United States since Tampa Electric's Polk Power Station came online in 1996. "Since then, advances such as higher efficiency gas turbines have moved IGCC technology forward," said John Krenicki, Jr., president and CEO of GE Energy. "Today's announcement is a clear sign that the energy industry is ready to enter a new era of cleaner coal power plants."

Providing GE Energy is awarded the contract for the next phase, it would supply the IGCC technology for the new AEP plant while Bechtel would perform engineering, procurement and construction for the plant. As announced last year, GE and Bechtel have developed a standard commercial offering for IGCC projects in the United States, offering a single point of contact for project developers.

"The focus of the IGCC alliance between GE and Bechtel is to establish successful IGCC ventures for power generation customers in the United States, establish a leadership position in the production of cleaner power from coal and petroleum coke and bring value to a wide range of customers," said Scott Ogilvie, president of Bechtel Power.

GE's IGCC technology converts coal into a cleaner burning fuel, which is then used in a gas turbine combined-cycle system to generate electricity. IGCC is a product of ecomagination(SM), a GE corporate-wide initiative to bring to the marketplace new technologies that will help customers meet pressing environmental challenges.

GE's IGCC "cleaner coal" process generates lower sulfur dioxide, nitrogen oxide, mercury and particulate matter emissions than a traditional pulverized coal plant, making the use of coal for power significantly cleaner. The process also uses less water than a traditional plant and can be more economically retrofitted for carbon capture, further strengthening its environmental benefits.

"We're thrilled to be moving forward with our goal of building the next generation of coal-fired power plants that offer enhanced environmental performance. We need additional generation, and we believe an IGCC plant, over its expected lifespan, offers the right, environmentally-responsible, cost-effective option for our customers," said Michael G. Morris, AEP's chairman, president and chief executive officer.

GE Energy has been a leading supplier of gas turbines for IGCC applications since the Cool Water Power Plant, the United States' first IGCC demonstration project, came online in 1984, as well as a leading supplier of gasification technology, which has been in commercial use for more than 50 years.

Bechtel Corporation is one of the world's leading engineering, procurement and construction companies, with significant experience in the design and construction of all forms of power generation facilities, including IGCC plants. GE Energy has worked with Bechtel on a number of IGCC projects, including the Cool Water and Polk plants.

In addition to being the largest electricity generator in the United States, owning more than 36,000 megawatts of generating capacity, AEP is one of the country's largest utilities, with more than five million customers linked to an 11-state electricity transmission and distribution grid. The company is based in Columbus, Ohio.

About GE Energy

GE Energy (www.gepower.com) is one of the world's leading suppliers of power generation and energy delivery technology, with 2004 revenues of $17.3 billion. Based in Atlanta, Georgia, GE Energy provides equipment, service and management solutions across the power generation, oil and gas, transmission and distribution, distributed power and energy rental industries.