Illinois lawmakers push coal legislation

Illinois lawmakers push coal legislation

	Published : Thu, 19 Apr 2007 16:22 By : Agencies Print this Story

WASHINGTON (AP) - With Illinois backers among the biggest boosters, lawmakers on Capitol Hill are pushing for a bill to encourage development of a domestic industry for producing liquid fuel from coal.

Illinois Republican John Shimkus and Virginia Democrat Rick Boucher, both members of the House Energy and Commerce Committee, plan within days to introduce a bill they say will address concerns that such an industry may be financially risky.

One of their strongest supporters is former House Speaker Dennis Hastert, R-Ill., who on Wednesday touted the benefits of additional competition for petroleum, so much of which comes from overseas.

'For the long-term security of Americans, I would much rather worry about who is the next mayor of Gillette, Wyoming, instead of who is the next ruler of Iran,' he said at a House hearing.

Proponents say a key provision of the legislation also should satisfy critics who have argued moving to a new coal-based industry would result in more carbon dioxide emissions.

Shimkus, whose district includes coal-rich southern Illinois and many farmers who, like him, advocate the use of ethanol -- a soybean- or corn-based fuel -- argued it's good to have competition among fuel alternatives.

'I think we have got a long way to go before we catch up with the ethanol,' he said. 'I'm a supply guy, and the more supply you have, the lower the cost.'

Proponents say converting coal to liquid fuel is economically and commercially feasible when the global price of crude oil is at least $40 a barrel -- the price now is more than $60.

'A large portion of today's oil price is political risk,' said Boucher, citing 'diplomatic differences' with oil-producing nations in the Middle East.

'This uncertainty about the future of oil prices has inhibited the investment of private capital in coal-to-liquids facilities in the U.S.,' he added.

The proposed bipartisan legislation would authorize the Energy Department to set 'ceiling' and 'floor' prices for crude oil. If the global market price exceeds the ceiling, the petroleum industry would contribute the difference to a federal trust fund. If the price falls below the floor, the emerging coal-to-liquid fuel industry could dip into the trust fund.

'At today's prices, coal-to-liquids is economical and has the power to enhance energy security, create jobs here at home, lessen the U.S. trade deficit, and provide environmentally superior fuels that work in today's vehicles,' testified John Ward, vice president of Headwaters Inc., a provider of clean coal technologies.

Shimkus said the legislation also would address environmental concerns.

'If we can just calm down the environmental community to look at it objectively I think we are fine,' Shimkus told reporters about prospects for passage.

Only coal-to-liquid fuel plants that used a process called 'carbon capture and sequestration' would be allowed to tap the trust fund. The process involves capturing emissions, separating carbon dioxide and sequestering it for commercial use or injection back into the earth to flush out oil.

Ward said plants equipped to capture and store carbon dioxide can produce fuels with greenhouse gas emissions at least as low as petroleum-based fuels.

'Any product made from oil can be made from coal,' he added.

Carbon dioxide is considered by many scientists to be the principal greenhouse gas that essentially traps energy from the sun, warming the Earth's surface and lower atmosphere.