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Planned Coal Site Gets Grant ; Proposed Plant Near Taylorville Gets $5 Million From State

Posted on: Wednesday, 11 January 2006, 18:00 CST

By TIM LANDIS BUSINESS EDITOR

TAYLORVILLE - Developers of a proposed $1.1 billion coal- gasification plant near Taylorville got a $5 million investment from the state Monday and hope to begin construction in the summer of 2007.

Project supporters say the plant, which will produce electricity and synthetic gas, will create 1,000 construction and 200 permanent jobs while burning 1.8 million tons of Illinois coal per year.

A partner in the project said developers would at least match the $5 million from the state to begin engineering and design work.

"If everything falls in place when it's supposed to, we should be in position to begin construction in mid-2007," said David Schwartz of The ERORA Group, a Kentucky-based development company that is behind the project.

Schwartz added that, once the design is complete, the group will seek financing to complete the $1.1 billion project. State and federal regulators also must give their OK, including a clean-air permit.

The state grants announced by Gov. Rod Blagojevich include $2.5 million from the Illinois Department of Commerce and Economic Opportunity and $2.5 million from the Illinois Clean Coal Review Board.

Bill Hoback, bureau chief of the Illinois Office of Coal Development, said at least four coal-gasification projects are in the works in the state. He noted that interest has risen along with the prices of oil and natural gas.

He said the state funding is an incentive for private investment in the multimillion-dollar projects.

"We know the technology works. We just need to get developers and bankers to say, 'We're comfortable with this technology,'" Hoback said.

Federal and state clean-air standards also will be met, he said, including stricter mercury-emissions standards proposed last week by the governor.

Plans are for the Taylorville Energy Center to use coal from an adjoining mine proposed by a separate development group. It has been projected the coal mine would create another 200 permanent jobs.

The ERORA plant would use "integrated gasification combined cycle" technology to produce both electricity and synthetic gas that could be shipped to power and pipeline networks. While the gasification plant and coal mine are proceeding on approximately the same track, the plant could begin operation without the mine, Schwartz said.

He added that demand for alternatives to natural gas and oil has increased significantly just since the group formally launched the project in 2003.

"The current market environment makes the products that we're producing much more attractive," Schwartz said. "I don't think it necessarily speeds up development, but we'll bring it online as fast as we can."

Source: State Journal Register

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