The Hydrogen Energy California (HECA) project, which had hoped to build a large coal/petroleum coke-based nitrogen and electricity project in Kern County, Calif., withdrew its motion to reinstate its application for certification (AFC) with the California Energy Commission on March 3. HECA had filed the motion late last year (GM Dec. 7, 2015) and a hearing was set for March 7, 2016.
“Recent developments, such as the U.S. Supreme Court’s Feb. 9, 2016, decision to stay implementation of the Obama Administration’s Clean Power Plan, which was rendered subsequent to applicant’s pending request to reinstate the revised AFC proceedings, have cast additional uncertainty over the timing of such projects,” HECA said in its withdrawal filing. “Given the current uncertainty related to timing, the time that has passed since some of the analysis related to the project was completed, and the likely need for substantially revised analysis to reflect anticipated changes to the project, applicant has decided to withdraw the revised AFC.”
The CEC quickly terminated the AFC proceeding and cancelled the hearing.
HECA conceded that the timeframe for deploying the project had been much longer than was originally anticipated.
HECA said it continues to believe that the site, which it will retain control over, is well suited for carbon sequestration. It said it will continue to monitor relevant policy, regulatory, legal, and economic developments, and work with agencies and other entities likely to play a role in the future deployment of the project. It said the information and analysis collected to date would be a substantial base upon which to develop a new application.
HECA arose out of the American Recovery and Reinvestment Act of 2009, when the DOE’s Office of Fossil Energy received $3.4 billion to focus on clean coal technology projects. In 2011, after DOE and HECA had spent $75 million on the project, HECA was transferred from original owners BP and Rio Tinto to SCS Energy California. As of late 2011, the cost of building the project was put at $4 billion and DOE’s share at $408 million. As of 2012, plans were for it to generate a total net output of up to a nominal 300 megawatts, make up to 1 million st/y of nitrogen-based products, capture a stream comprised primarily of CO2, and transport it by pipeline to a neighboring oilfield for enhanced oil recovery and sequestration (GM Dec. 31, 2012).
HECA requested and received a six-month suspension of the AFC last summer while it readied the project for a more detailed review (GM July 13, 2015). When it filed its motion to reinstate the AFC, it said it had resolved the C02 off-taker and carbon sequestration issue, as well as Kern County concerns that it might produce non-fertilizer nitrogen products. HECA had argued that it could permanently sequester the C02 beneath the project site, with this approach eliminating the need to contract a C02 off-take agreement. HECA was originally going to sell the C02 to oil companies, but was never able to reach a deal.
Opponents were not happy with this plan and continued opposition was expected. HECA had opposition from neighbors, environmental groups, and Kern County officials.
Another coal-based nitrogen project was still in the proposal stage in January (GM Jan. 8, p. 1). The Summit Power Group’s Texas Clean Energy Project (TCEP) near Odessa, Texas, would produce 714,000 st/y of urea. TCEP had been anticipating a financial close in the spring of 2016. Did the Supreme Court decision also alter their thinking? The company had not responded to inquiries at press time.