23 January 2007 -- GE Energy Financial Services, a unit of General Electric, announced today that it has made its first investment in a plant that will generate power and produce synthetic natural gas using coal gasification technology. It is acquiring a 20 percent equity interest in The ERORA Group LLC, which is developing Kentucky's 630 MW Cash Creek integrated gasification combined cycle (IGCC) facility.
GE Energy Financial Services did not disclose financial details of the transaction with Louisville-based ERORA. The deal emphasizes the growing interest from financial institutions in IGCC technology and its potential for the market. A full-size utility-grade commercial IGCC plant has yet to be built and many opponents charge that it is still an "unproven" technology.
GE touted the technology's promises for fewer air emissions and less water use relative to conventional coal-based power generation technologies.
"This transaction is an anchor for our plans to grow by investing in gasification -- a cleaner, more environmentally friendly power source compared to traditional coal-fired generation -- and is consistent with GE's ecomagination initiative, helping customers meet their environmental challenges," said Dan Castagnola, a managing director at GE Energy Financial Services.
"The investment represents an opportunity to build a coal gasification facility that takes advantage of an abundant, locally produced natural resource in Kentucky, the nation's third-largest coal-producing state."
Ecomagination is GE's commitment to expand its portfolio of cleaner energy products while reducing its own greenhouse gas emissions.
The Cash Creek project's location in Henderson County along the Green River provides the opportunity to interconnect with three electric grids -- the PJM West, MISO and SPP -- and is within six miles of both the ANR and TGT interstate gas pipeline connections, allowing transport to end customers of the gas it will produce. Construction of Cash Creek is expected to begin in late 2007, pending financial close and required project approvals, with commercial operation planned in 2010 or 2011.
In making this investment in The ERORA Group, GE Energy Financial Services joins the New York investment firm D.E. Shaw group, which acquired a majority interest in the company last year.