It says that currently available energy efficiency and renewable energy technology would do the job at about half the cost and would create more jobs than an alternative that looks more like the current mix of renewable energy, nuclear power and coal.
However, the U.S. has sent strong signals lately that it wants to find a way to keep using coal without the emissions.
Chu said he was meeting with his counterparts in other countries to try to create an international alliance that would share the task of finding the best technology for carbon capture and storage.
China, Canada, Australia and the European Union are working on their own projects, and foreign investors, including China and India, were part of the original FutureGen program.
Acting Assistant Secretary of Energy for fossil fuels Victor K. Der gave more details about the department's views in testimony Wednesday before the Energy and Environment Subcommittee of the House Committee on Science and Technology.
It would be very difficult to reduce greenhouse gas emissions without carbon capture and storage because the U.S. relies so heavily on fossil fuels, Der said. Coal provides half of the nation's electricity.
Der also said that Chu planned to meet with the FutureGen Alliance and probably would make a decision shortly on how to spend the $1 billion in stimulus money that could be used for FutureGen.
Der said that FutureGen was almost ready to start, and that no other carbon-capture demonstration project was farther along.
The Bush administration canceled FutureGen last year, citing higher-than-expected costs, though the Government Accountability Office reported Wednesday that the DOE had made a math error that made the increased cost appear much higher than it was.
Michael Mudd, the chief executive officer of the FutureGen Alliance, a group of electric utilities and coal companies that want to invest in the project jointly with the government and build the plant in Mattoon, Ill., said Tuesday that he was optimistic that the project would go ahead and that he was waiting to negotiate with the DOE.
The DOE estimates that the technology would add about 80 percent to the cost of electricity from a conventional coal plant and about 35 percent to the cost from a plant that makes electricity by turning coal into a gas, a system that's used in only two of the nation's more than 600 large coal plants.
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