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September 13, 2010
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TECO Energy will partner with RTI International for the development and completion of the pilot project. The design, construction and operation of the pilot plant will be entrusted upon RTI, with an aim to capture a portion of the plant's CO2 emissions to demonstrate the technology.
The pilot plant, which is designed to capture CO2 from a 30% side stream of the coal-fired plant’s syngas, is expected to complete in 2013. The project is expected to sequester approximately 300,000 tons of CO2 more than 5,000 feet below the Polk Power Station in a saline formation. The new carbon capture technology is aimed to significantly reduce the operating and capital costs of an integrated gasification combined cycle plant.
RTI is working closely with the U.S Department of Energy (DOE) to create carbon free power. RTI will utilize the DOE grant of about $168 million for the design, construction and testing of a warm gas cleanup system, combined with carbon capture at a pre-commercial scale of about 50 megawatt electric equivalent.
During the second-quarter 2010 Tampa Electric company contributed $56.8 million to TECO Energy’s net earnings of $79.6 million. Operating earnings of TECO Energy for 2010 is expected to be in the range of $1.25 to $1.35 per share.
The Zacks Consensus Estimates for third quarter fiscal 2010, fiscal year 2010 and fiscal year 2011 are 42 cents per share, $1.34 per share and $1.43 per share, respectively.
The positives of TECO Energy are its solid utility cost management and a high dividend yield; however, these positives are offset by volatility in fuel prices, uncertainty on regulatory decisions and environmental legislations. Hence, we maintain a Neutral rating on the stock. TECO Energy currently retains a Zacks #2 Rank (short-term Buy rating).
Based in Research Triangle Park, North Carolina, RTI International is an independent non-profit research institute, which offers innovative research and technical expertise to governments and businesses worldwide.
Based in Tampa , Florida , TECO Energy, through its subsidiaries, engages in the generation, purchase, transmission, distribution, and sale of electric energy in Florida .
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