• E-mail
• Print
• Comment
• Font Size
• Digg
• del.icio.us
• Discuss article

EDITORIAL: Try Again: State Should Sweeten Bid for Plant

Posted on: Tuesday, 16 May 2006, 09:04 CDT

By The Paducah Sun, Ky.

May 16--It's disappointing that Gov. Fletcher has concluded Kentucky probably isn't a top contender for a $1 billion, state-of-the-art energy plant.

The governor's pessimism about the project is a bit puzzling. Earlier this month, state officials announced they had chosen a site in Henderson County as a potential location for the FutureGen coal gasification facility. At that time, Gov. Fletcher issued a statement declaring that his administration had "put forth a very competitive proposal that should receive the strongest consideration by the FutureGen Alliance."

Seven states are competing for the project, a public-private venture involving the U.S. Department of Energy and a consortium of energy companies, including the nation's largest coal companies. Billed as "the world's first zero emissions fossil fuel plant," the FutureGen facility will use cutting-edge technology to turn coal into a hydrogen-rich gas that can be used to generate electricity or fuel a new generation of hydrogen-powered vehicles.

As one of the nation's leading coal-producing states, Kentucky should be in a strong position to compete for the project.

The Henderson County site chosen by state officials has some obvious advantages. It's located near an active coal mine and includes land reclaimed from mining, which mitigates environmental concerns. Also, the site isn't far from the confluence of the Green and Ohio rivers. The FutureGen plant will need access to water and a major transportation corridor.

It certainly doesn't hurt the state's chances that western Kentucky has an ample supply of high-sulfur coal. Federal clean-air regulations devastated the high-sulfur coal industry, but President Bush is pushing new clean-coal technologies that could allow the nation to make full use of its coal reserves. With coal gasification -- the basic technology underlying the FutureGen project -- energy companies should be able to use high-sulfur coal without spewing pollution into the atmosphere.

The revival of high-sulfur coal would be a boon to economically distressed counties in the Pennyrile region. Unemployment in the Pennyrile is running well above the national average. The FutureGen project would create 150 high-tech jobs, but the more important benefits would come from increased coal-mining and the creation of jobs related to the development of the clean-coal technology.

Gov. Fletcher says Kentucky fell behind early in the competition for FutureGen. That's somewhat surprising, given that former Commerce Secretary Jim Host had made landing the project part of the Fletcher administration's overall energy strategy for the state. Surely, the governor, the state's economic development officials and key lawmakers were aware of the importance of getting the state out front in the race to develop the new energy technology.

Fletcher notes that some of the competing states have put together impressive packages of tax incentives to offer the FutureGen consortium. Elected officials and state industrial recruiters in Ohio and Texas appear especially determined to win the battle for FutureGen.

In our view, it's not too late for Kentucky to catch up and surpass the competition. As we noted, the state has a good site; the chief problem seems to be the paltry $2.4 million incentive package the state is offering.

Gov. Fletcher has said he intends to call the legislature back to Frankfort for a special session on revamping a tax that has hurt the state's small businesses. Why not use that opportunity to improve the incentive package for FutureGen?

The administration's economic development team should be able to assess the competing proposals and come up with a far more attractive package of incentives. Given what's at stake -- the potential revival of the economy of an entire region of the state -- the governor and the leaders of the General Assembly ought to be able to agree on a plan that moves the state to the top of the list of contenders for the project.

-----

Copyright (c) 2006, The Paducah Sun, Ky.

Distributed by Knight Ridder/Tribune Business News.

For information on republishing this content, contact us at (800) 661-2511 (U.S.), (213) 237-4914 (worldwide), fax (213) 237-6515, or e-mail reprints@krtinfo.com.

Source: The Paducah Sun

More News in this Category