Southern California Edison Launches the Nation's First Full Commercial Scale Assessment of Advanced Coal Generation Technologies

Business Wire, April 10, 2008

ROSEMEAD, Calif. -- Southern California Edison (SCE) will conduct the nation's first feasibility study combining several advanced coal technologies at full commercial scale. The decision to move forward with the two-year, approximately $50 million technology assessment follows approval of the plan today by the California Public Utilities Commission (CPUC). SCE will make the study results available to all interested parties.

SCE's advanced coal generation study combines for the first time the following elements:

* A chemical process that captures as much as 90 percent of the carbon dioxide in domestic coal, the highest level targeted by a U.S. advanced coal initiative.

* Producing a mostly hydrogen fuel and emitting only 10 percent of the carbon released by an integrated gasification combined-cycle coal project without carbon capture.

* Burning the hydrogen in a highly efficient, combined-cycle generation system.

* Sequestering the carbon dioxide in a deep saline formation or a depleted oil formation to create enhanced oil recovery.

* The use of these technologies in a full-scale, 600-megawatt commercial generation facility.

"Coal is our nation's most abundant, economic and secure fuel source," said Richard Rosenblum, SCE senior vice president and head of power production. "This ground-breaking analysis is part of Southern California Edison's continuing effort to push forward new generating technologies needed to build a low-carbon future."

The new SCE study extends Edison International's long-standing involvement in advanced generation research. According to a report by the U.S. Department of Energy (DOE), "(t)he first major use of coal gasification to generate electric power in the United States took place in the mid-1980s at Southern California Edison's experimental Cool Water demonstration plant near Barstow, California. The 110-megawatt Cool Water plant established the early technical foundation for future Integrated Gasification Combined Cycle power plants." (The DOE study can be found at: www.fe.doe.gov/programs/powersystems/gasification/gasificationpioneer. html) (Due to its length, this URL may need to be copied/pasted into your Internet browser's address field. Remove the extra space if one exists.)

The regulatory approval received today is the second major endorsement in the past six months of SCE's proposed feasibility study. The DOE on Oct. 9, 2007, announced a grant of more than $65 million to SCE and other participants in the Southwest Regional Partnership for Carbon Sequestration to conduct one of the nation's first large-scale carbon sequestration studies. The partnership plans to inject several million tons of carbon dioxide into the Jurassic-age Entrada Sandstone Formation in the Southwestern United States as one of the technology studies in SCE's Clean Hydrogen Power Generation program.

"California and SCE customers will receive the benefits of this low-carbon technology assessment for less than half the cost of the total study because of the DOE grant," said Rosenblum.

SCE is pursuing opportunities to spread the costs and benefits among several participants.

How SCE's CHPG process would work

1. Coal and water enter a "gasifier" where the coal is converted to a fuel gas.

2. The gas undergoes additional processing to remove sulfur, mercury and carbon dioxide resulting in very low-emission hydrogen fuel.

3. Carbon dioxide extracted during the process is sequestered in secure underground geologic formations.

4. The hydrogen is piped to gas turbines where electricity is generated.

5. Exhaust heat from the gas turbines is used to create steam and drive additional turbines, resulting in maximum power-generation efficiency.

SCE asked regulators in May 2007 for authorization to commit revenues it collects from customer rates to the proposed technology study. The amount approved today represents approximately a quarter of 1 percent of current customer rates.

Explanation of gasification

The chemical process known as gasification breaks down coal into its basic chemical parts, converting them to hydrogen to be used as a fuel to generate electricity. In a modern gasifier, coal is exposed to hot steam and carefully controlled amounts of oxygen under high temperatures and pressures converting the coal to two fuel gasses: carbon monoxide and hydrogen. The carbon monoxide is then converted to additional hydrogen and carbon dioxide in the shift conversion as shown in the diagram. The carbon dioxide is then removed from the gas stream before entering the gas turbines and sequestered rather than released into the atmosphere. The result is one of the cleanest power generation technologies available.

An Edison International (NYSE:EIX) company, Southern California Edison is the largest electric utility in California, serving a population of more than 13 million via 4.8 million customer accounts in a 50,000-square-mile service area within Central, Coastal and Southern California.