The U.S. Department of Energy awarded $126.6 million in grants on Tuesday to test carbon capture and storage in underground caverns.
Two sites in Ohio and California will try to verify that carbon dioxide gas can be pumped in geological formations and stored safely. The CO2 will be delivered from an ethanol plant in Ohio and a power plant in California.
The grants are subject to approval from Congress. When private money is included, the amount spent on the projects will be about $180 million over 10 years, the DOE said.
The Bush Administration and many other energy experts consider carbon capture and storage an important tool in reducing greenhouse gas emissions in the atmosphere.
The DOE has identified enough underground "sinks" to store 1,000 years of storage capacity. Pumping CO2 can also aid in extraction more from oil and gas wells.
However, there are a number of unanswered questions regarding the process.
The latest DOE tests, part of a regional carbon sequestration research program, will put 1 million tons underground, monitor how effective underground caverns are at storing the gases, and assess how cost effectively it can be done.
The California test will be in the San Joaquin Basin in Central California, where CO2 will be compressed and pumped 7,000 feet underground. The Ohio project will pump the gas 3,000 feet underneath the Mount Simon Sandstone.
At the same time, the DOE is sponsoring the FutureGen project to store carbon underground at coal-fired power plants. The project was recently restructured, pushing back its planned start date to 2015, in a move that drew criticism from many coal companies.
Speaking at a news conference on Wednesday where he announced FutureGen's technical requirements, DOE undersecretary Bud Albright said that the two tests in California and Ohio will be able to sequester 600 billion metric tons of CO2, the equivalent of 200 years of emissions from the U.S.
Environmental groups have also started to question carbon sequestration policies.
GreenPeace on Monday issued a report that called so-called clean coal "dubious technology" and inadequate.
"Carbon capture and storage is a scam. It is the ultimate coal industry pipe dream," said Emily Rochon, climate and energy campaigner at Greenpeace International and author of the report, in a statement.
For more details on the DOE's program see its carbon sequestration page.