Summary: In response to a congressional request, GAO reviewed the Department of Energy's (DOE) implementation of its Clean Coal Technology Program, focusing on: (1) the DOE process for negotiating cooperative agreements with project sponsors; (2) DOE changes to the project; (3) status of funded projects; and (4) interrelationships between acid rain control and commercialization of clean coal technologies.
GAO found that DOE: (1) timely signed only two of nine initial project agreements; (2) negotiated five projects later than expected and sponsors withdrew two projects, which DOE replaced with four alternative projects from a prepared list; (3) signed agreements for two replacement projects, terminated negotiations for one unfunded project, and selected three replacement projects for funding; (4) encountered difficulties with financing, business arrangements, and proprietary data; (5) completion of the project agreements was delayed by sponsors' attempts to renegotiate investment repayment requirements; and (6) changed its project requirements, including financial commitments for preliminary project design, reimbursement of preaward costs, repayment based on equipment sales revenues, and project review. GAO also found that: (1) sponsors' dissatisfaction with the revised repayment requirements and DOE access to proprietary data could further delay implementation; (2) DOE extended some projects by up to 13 months, and expected other projects to slip; (3) DOE indicated that equipment delays and failures, financing problems, and permit delays created the schedule slippage; and (4) proposed acid rain control legislation could impact commercialization of clean coal technology, if the legislation allowed development of new technology while requiring short-term emissions controls through conventional technologies.
