NRG Energy Inc. (NRG) has been selected by the United States Department of Energy (DOE) to receive up to $154 million funding to build a post-combustion carbon capture demonstration unit at its Washington Parish plant.
Earlier NRG Energy submitted the project under the Clean Coal Power Initiative Program (CCPI). CCPI is a cost-shared collaboration between the federal government and private industry to demonstrate low-emission carbon capture and storage technologies in advanced coal-based, power generation. The goal of CCPI is to facilitate a rapid use of advanced coal technologies for commercial deployment, ensuring that the United States has clean, reliable, and affordable electricity and power.
Scheduled to begin operating in 2013, NRG’s carbon capture demonstration project will be among the first of its kind. It will use Fluor Corporation’s (FLR) advanced Econamine FG Plussm technology to process flue gas from the plant. It will be designed to capture 90% of incoming CO2, or approximately 400,000 metric tons of CO2 annually. Once captured, the CO2 will be compressed and used in enhanced oilfield recovery operations.
Carbon capture technology is part of NRG Energy’s clean energy portfolio that includes nuclear, onshore wind, offshore wind and solar that will help the company meet future energy production and environmental sustainability goals.
NRG Energy owns and operates one of USA’s largest and most diverse power generation portfolios. Headquartered in Princeton, New Jersey, the company’s power plants provide more than 24,000 megawatts of generation capacity. NRG’s retail business, Reliant Energy, serves more than 1.6 million residential, business, commercial and industrial customers in Texas.
However our bullish outlook on NRG Energy would be partially offset by execution risk related to expansion of its nuclear generation capacity, natural gas price volatility and need for environmental capital expenditure to adhere to federal guidelines. We maintain our long-term Neutral recommendation on the stock.
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