Houston (Tex.) Chronicle  [Printer-friendly version]
August 19, 2007


Wall Street, environmental backers and Congress all have reservations

By Tim Huber, Associated Press

DANIELS, W.VA. -- One theme dominated discussion last week at an
industry-sponsored conference on turning coal into gasoline and diesel
fuel: finding political support for government incentives.

There are a dozen or so coal-to-liquid plants in varying states of
development around the country. But supporters such as Rep. Nick
Rahall, D-W.Va., say incentives such as tax credits and loan
guarantees are key to quickly creating an industry that can push the
nation toward energy independence.

"Coal to liquids will happen in this country. It's going to be an
evolutionary process. It's going to be a slow process," said Michael
Hayes of Sasol North America. Sasol already produces transportation
fuel from coal in South Africa.

Supporters at the Coal-To-Liquids Coalition conference in Daniels say
Wall Street won't finance plants that can cost up to $8 billion
without some guarantee of a decent return. The group was created by
the National Mining Association.

Military use proposed

While dozens of protesters rallied outside the conference carrying
signs that read "Liquid Coal Destroys Communities" and "No Fuel From
My Blood," among others, Sen. Jay Rockefeller, D-W.Va., outlined a
four-part plan to build a coal-to-liquid industry. He called for
military use of coal-based fuel, unity among coal supporters, a
"substantial" investment on the scale of the Manhattan Project to
attack climate change, and construction of pipelines in Appalachia to
transport fuel to users and carbon dioxide to oil and natural gas
fields for storage.

"Coal, clean coal, must be the solution to our energy needs,"
Rockefeller said. "It is the only solution to our energy needs. That
is what is so ridiculous about all of it. It's what we've got. God
gave it to us."

Congress seems reluctant to pass incentives, in part because of
arguments from the environmental community that fuel made from coal
will generate more greenhouse gases than refining crude oil, Rahall

"It's certainly an uphill battle," Rahall said.

Rep. John Murtha, D-Pa., said it's not going to be easy.

"The public as a whole believes in environmentally clean air.... It's
a tough job to convince them," he said.

Labor-industry cooperation

United Mine Workers President Cecil Roberts said winning will take
more cooperation between industry and labor.

While both have great individual lobbying power in Washington, Roberts
said labor and industry must find a way to work together rather than,
for example, supporting competing legislation. A total of 69 senators
voted for one measure or the other, Roberts said.

"There is a consensus of some type.... We just have to find some
uniformity in our approach."

Hayes and Murtha said industry also needs support from average

"It's going to be the public demanding that CTL happen and happen
quickly," Hayes said. "Then CTL will happen."

If the public speaks, Murtha said Congress will listen. "If you're not
responsive to the people who elect you, you don't come back."