Texas Clean Energy Project

From Global Energy Monitor

Texas Clean Energy Project was a proposed 400-megawatt coal-fired power station near Odessa, Texas. The power station would include carbon capture and storage (CCS).

The sponsor Summit Power filed for bankruptcy in 2017, after the US Department of Energy pulled its $450 million support for the project in the wake of allegations of improper spending by the sponsor. Additionally, Summit did not attract sufficient private funding for the project.[1]


The undated satellite photo below shows the proposed location for the plant, on a 600-acre site outside Penwell, 15 miles west of Odessa.

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Project summary

According to the Texas Clean Energy Project website (2015), the project would be 400 MW and located at one of the former FutureGen finalist sites – the 600-acre Penwell site – situated fifteen miles west of Odessa, Texas. An environmental impact statement was issued by the U.S. Department of Energy (DOE) on September 29, 2011. The project was scheduled for financial close by 2015 and operation by 2018. The captured carbon dioxide would be used for enhanced oil recovery (EOR) in the West Texas Permian Basin, where the project is located. Nearly three million tons of carbon dioxide would be captured for EOR in local oil fields.[2]


In 2007, Odessa had been considered one of four candidate sites[3] for a FutureGen Industrial Alliance project, “a public-private partnership to design, build, and operate the world's first coal-fueled, near-zero emissions power plant”.[4] According to the FutureGen website, the DOE issued its Final Environmental Impact Statement (EIS) in November 2007, concluding that the Odessa site was acceptable from an environmental impact standpoint and could move forward in the site evaluation process.[5]

FutureGen ultimately selected another site, Mattoon, Illinois, as the final site. After the decision was made, DOE representatives performed another similar site study at Odessa to determine if the site could qualify for funds from the Clean Coal Power Initiative.[6]

In 2008, Colorado-based Summit Power Group announced plans to construct the Texas Clean Energy Project (TCEP), a 600 megawatt Integrated Gasification Combined Cycle plant. A site for the plant has not been determined, but officials say the Permian Basin is a contender because captured carbon dioxide could be sold to local oil and gas companies for oil field injection. Coal would likely come from the Powder River Basin.[7] TCEP is called a “NowGen” carbon capture facility that aims to capture ninety percent of its carbon dioxide emissions.[8][9]

On June 22, 2009, a new Texas law, HB 469, was passed and signed by the governor. HB 469 offers significant financial incentives to the first three clean-coal power plants built in Texas that capture at least 50 percent of their carbon dioxide.[10]

Summit formally launched a front-end engineering design (FEED) study on June 30, 2010, and later awarded the FEED contract to Siemens Energy[11] to be the primary equipment provider.[12] Other participants in the FEED study include Fluor Corporation (the design engineer[13]) and Selas Fluid Processing Corporation, a Linde Group subsidiary.[14] Construction was scheduled to begin on the project in the second half of 2011 upon completion of the FEED study.[15]

TCEP was scheduled to achieve financial closing and commence construction in December 2010, but was delayed. In September 2011 the United States Department of Energy boosted its funding for the project from US$350 to $450 million.[16] However, the funds given by the DOE will not meet the costs of the plant, which are estimated to be around US$2.2 billion.[17]

The project seemed ready in 2012 when the Chinese company Sinopec signed on and requested a new FEED study. Cost estimates went to $3.5 billion due to increased labor costs.[18]

In May 2014 Summit Power requested an additional year to "to realign the project and reevaluate costs," but said the project was "still a go".[19] Project costs were later scaled back to US$2.5 million.[20]

In June 2015 Summit Power Group said it expects to reach financial closure on the project by September 2015, and then start awarding contracts for construction. If that timeline holds, the long-delayed project would satisfy deadline requirements of the Department of Energy, which granted US$450 million for the project. If Summit fails to secure financing, Summit may lose the federal stimulus funds allocated to the project. According to Summit, all of the debt financing will come from the the Export-Import Bank of China. Summit is still raising the equity money.[20]

After a critical audit of the project by the DOE's Inspector General, the DOE said it would not spend any additional money on the project unless Summit Power finalizes engineering and construction contracts, and secures debt and equity to cover the building costs by May 13, which was later extended to July 2016. According to Inside Climate News: "While the Texas Clean Energy Project is not officially dead, continued refusal by the Department of Energy to extend any more money would effectively kill it, according to its builder."[21]

The US Energy Department had planned to withdraw federal funding for the Texas Clean Energy Project on July 15, 2016, if Summit failed to provide firm commitments from lenders and investors to finance the whole project. But before the agency announced its decision, developers cited a regulation to launch an informal dispute resolution process, buying the project more time. Project costs have grown to US$3.9 billion, more than twice the $1.9 billion estimated at in 2010.[22]

In December 2016 Summit Power Group said it plans to scrap the power generating portion of the Texas Clean Energy Project in a bid to keep the coal project alive. Instead, the company will reconfigure the project to produce more fertilizer by adding another urea line. Summit said they were in search of an equity partner for the fertilizer project.[23]

Summit Power filed for Chapter 7 bankruptcy in October 2017. According to a 2018 US DOE Oversight Report related to the project's government funding, the Inspector General Office "directly identified over $2.5 million in expenditures Summit charged to the Project that we questioned as potentially unallowable, including over $1.2 million in potential lobbying costs and $1.3 million in questionable or prohibited travel-related expenses."[24]

Powder River Basin coal deal for Texas Clean Energy Project

In August 2011 it was reported that Summit Power Group is "within a month" of closing on Powder River Basin coal supplies for its $2.7 billion Texas Clean Energy Project. The plant is to be a 400-MW integrated gasification combined cycle power plant. The company contends that it is set to become operational in the fourth quarter. The plant will require 2 million st/year of Powder River Basin output.[25]

Federal funding

On December 4, 2009, Secretary Stephen Chu of the United States Department of Energy announced that TCEP will receive $350 million to help develop the facility. The company notes that the government's investment will help reduce TCEP’s costs. It was the largest award given up to that date by the Department of Energy's Clean Coal Power Initiative, which was enacted and funded by Congress.[26]

TCEP also received an additional $100 million from the American Recovery and Reinvestment Act (ARRA) in August 2010.[9]

In September 2011 the U.S. Department of Energy issued a Record of Decision approving $450 million from DOE’s Clean Coal Power Initiative (CCPI) for the project. Of this, $211 million will come from American Recovery and Reinvestment Act (ARRA) funds for CCPI.[27]

A 2018 DOE Oversight Report found $2.5 million dollars of federal funding for the project had been misspent by Summit Power, including "over $650,000 in consultant charges for items such as a spa service, alcohol, first-class travel, limousine services, receipts in foreign currency, and business meals that were prohibited or not fully substantiated."[28]

Plant Opposition

Texas Public Citizen opposes the plant and argues that coal cannot be clean, no matter what technology is used. "We don’t support the use of coal for electrical generation, period," said Tom "Smitty" Smith, Executive Director of Public Citizen in Texas. "There are significant problems with the mining of coal ... then you have significant problems with coal waste disposal, like coal ash in Tennessee or contamination of watersheds."[29]

Project Details

Sponsor: Summit Power Group
Location: 15 miles west of Odessa, TX
Capacity: 400 MW
Status: Cancelled
Type: IGCC and CCS
Proposed start year:
Financing: United States Department of Energy ($450 million), Export-Import Bank of China



  1. "Audit Report on 'The Office of Fossil Energy’s Oversight of the Texas Clean Energy Project Under the Clean Coal Power Initiative'”, US DOE Office of Inspector General, Feb 2018
  2. "The Project," Texas Clean Energy Project, accessed August 2015
  3. "FutureGen - FutureGen Project Takes Giant Leap Forward, Draft Environmental Impact Statement Released". Futuregenalliance.org. 2007-05-25. Retrieved 2010-08-17.
  4. "FutureGen Industrial Alliance, Inc". Futuregenalliance.org. Retrieved 2010-08-17.
  5. "FutureGen - Siting FutureGen". Futuregenalliance.org. Retrieved 2010-08-17.
  6. "Summit public hearing | hearing, study, public - Local News - Odessa American Online". Oaoa.com. 2010-05-21. Retrieved 2010-08-17.
  7. "Officials say they hope FutureGen efforts not wasted, Working for bid from energy company for similar plant", Kathleen Thurber, MyWestTexas.com, April 16, 2008.
  8. Texas Clean Energy Project Texas Clean Energy Project Homepage, accessed April 5, 2010.
  9. 9.0 9.1 "Texas Clean Energy Project (TCEP) Fact Sheet: Carbon Dioxide Capture and Storage Project," MIT CCS tech, accessed Sep. 2013.
  10. "Office of the Governor Rick Perry - Press Releases - Gov. Perry: Incentives will Create New Clean Energy Sources". Governor.state.tx.us. Retrieved 2010-08-17.
  11. "Siemens to Supply Technology for New IGCC Project in the U.S., Siemens Energy, Inc". News.thomasnet.com. Retrieved 2010-08-17.
  12. "Blue Source and Summit Texas Clean Energy partner for carbon capture project". NewEnergyWorldNetwork.com. 2009-10-27. Retrieved 2010-09-02.
  13. "Summit Power Launches Front End Engineering Design Study for Texas Clean Energy Project". PR.com. 2010-07-21. Retrieved 2010-09-02.
  14. "Summit Power begins FEED study for Texas IGCC-CCS project". Carbon Capture Journal. 2010-06-30. Retrieved 2010-08-17.
  15. "Summit Power Launches Front End Engineering Design Study for Texas Clean Energy Project". PR.com. Retrieved 2010-08-17.
  16. "US DOE to fund Summit with $450 mln for clean coal" Reuters, September 28, 2011.
  17. "All Eyes on Odessa's Clean Coal Future" Jen Kaster, NewsWest9.com, September 30, 2011.
  18. Paul, Corey (March 20, 2015). "Summit quiet about cost estimate delay". Odessa American. AIM Media TX LLC. Retrieved 22 March 2015.
  19. "Summit requests year extension" Texas Clean Energy Project, May 31, 2014.
  20. 20.0 20.1 "Summit says final contracts imminent," OA Online, June 11, 2015
  21. "Energy Department Suspends Funding for Texas Carbon Capture Project, Igniting Debate," Inside Climate News, May 13, 2016
  22. "Clean-Coal Project Slammed by Watchdog Gets Late U.S. Reprieve," Bloomberg, July 15, 2016
  23. "Summit ditches power in bid to salvage project," OA Online, Dec 8, 2016
  24. [https://energy.gov/sites/prod/files/2018/02/f48/DOE-OIG-18-17.pdf "Audit Report on 'The Office of Fossil Energy’s Oversight of the Texas Clean Energy Project Under the Clean Coal Power Initiative'”, US DOE Office of Inspector General, Feb 2018
  25. "Summit closes in on deal for PRB coal for new Texas plant" Steve Hooks, Platts.com, August 23, 2011.
  26. "Summit Power Group" Summit Power Project List, accessed April 5, 2010.
  27. "Innovative Texas Clean Coal Project Takes Major Step Forward as DOE Issues Record of Decision," U.S. Department of Energy press release, September 27, 2011
  28. [https://energy.gov/sites/prod/files/2018/02/f48/DOE-OIG-18-17.pdf "Audit Report on 'The Office of Fossil Energy’s Oversight of the Texas Clean Energy Project Under the Clean Coal Power Initiative'”, US DOE Office of Inspector General, Feb 2018
  29. "West Texas power projects could hold the key to carbon emissions" Jack Z. Smith, Fort Worth Telegram, June 6, 2009.

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