Rendell Urges President to Reverse Course, Restore Funding to Nation’s First Coal-to-Liquid Fuel Plant

HARRISBURG – Gov. Edward G. Rendell called on President Bush to restore critical funding in the federal budget for development of the nation’s first plant designed to convert waste coal into clean-burning diesel fuel in Schuylkill County.

A promised, $100 million, no-interest loan to help with construction and startup costs for the $800 million plant was removed from the proposed federal budget that was released on Monday. The loan was promised by the Department of Energy in 2003.

The plant operator, Waste Management and Processors Inc., began preliminary work at the site in the fall of 2006 and was preparing to start construction in the spring.

“The president, in his State of the Union address, promised to promote clean coal technologies and lead the charge for cutting America’s reliance on oil, but his new budget instead cuts funding for a very promising solution to our energy needs,” Rendell said. “I am calling on the president to reverse course, keep his word and restore the funding for America’s first waste-coal-to-diesel plant.”

The proposed plant would convert 1.7 million tons of waste coal per year into 60 million gallons of non-petroleum based liquid fuel, of which 40 million gallons will become zero-sulfur diesel fuel and 20 million gallons will become naptha, a gasoline production feedstock.

“We are doing far more than simply funding research,” Rendell said. “We have assembled a coalition of government and private businesses that will purchase nearly all the product generated by the plant for the next 10 years, guaranteeing that this new technology will have the opportunity to survive and compete in the energy marketplace.”

U.S. Sen. Arlen Specter and Congressman Tim Holden, whose district encompasses the plant, have worked toward development of this project for nearly a decade. Governor Rendell promised to work with both of them, along with newly-elected U.S. Sen. Robert Casey Jr. and the rest of Pennsylvania’s congressional delegation, to coordinate a united, bipartisan effort to restore funding for the plant.

In addition to creating liquid fuels to reduce imports of foreign oil, the proposed plant would – at no cost to the taxpayers — reclaim dangerous abandoned mine sites and remove waste coal piles that pollute waterways. Pennsylvania has over two billion tons of waste coal, and more than 180,000 acres of abandoned mine lands left over by the unregulated mining practices of the past.

Rendell recently unveiled his Energy Independence Strategy, an initiative that will invest $850 million to significantly expand Pennsylvania’s alternative-fuel and clean-energy industries, stabilize electricity rates for businesses, reduce dependence on foreign oil and cut consumer energy costs by $10 billion over the next 10 years. The Governor’s proposal calls for replacing all imported fuel with homegrown renewable fuel sources such as ethanol and biofuels and offers incentives for electricity generators to invest in conservation measures.

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