September 20, 2007

SIUC study assesses economic impact of FutureGen

by K.C. Jaehnig

CARBONDALE, Ill. — While Illinois would benefit if chosen as the site for a nearly pollution-free, coal-fired power plant, the county landing the FutureGen prototype would win big.

The value of the state's goods and services would increase by $135 million, according to a study done for the Illinois Office of Coal Development by Ira J. Altman, a Southern Illinois University Carbondale agribusiness economist. Labor income would rise by $34 million, profits by $91 million and tax revenue by $11 million, and the state would gain 510 new jobs in its power generation sector.

The bulk of these increases would go to Coles or Douglas county, depending on whether the plant located in Mattoon or Tuscola. The "winning" county would see the value of its goods and services go up by $85 million, its total labor income rise by almost $20 million, its profits grow by $59 million and its tax revenues increase by as much as $8.1 million, while 360 residents would find permanent energy industry jobs.

"In the context of the overall state economy, the impacts appear modest," Altman said.

"Adding 510 jobs to a 7.4 million-job economy is only a .007 percent increase. But the economic effects are very significant for the counties."

The state would see a significant impact from the four-year construction phase as most contractors would come from outside the county, but this would end when construction ceased. Altman projected temporary increases of $258 million in the value of goods and services, $116 million in labor income and 2,525 added jobs.

Altman arrived at these figures with IMPLAN, a computerized analysis system that uses software and databases to snap an overall picture of a local or regional economy. Using specific information about an area, its industries, services, social institutions and business transactions, the program can detail an existing economy or predict the effects of changes in particular sectors upon the whole.

"It's handy to use," Altman said.

"You don't have to collect data and build the model. If I'd had to do that, it would have taken at least three times as long and been at least three times more expensive."

In the near future, Altman hopes to do a similar study on Texas as a whole and on its Ector and Leon counties, the other sites in the running for the FutureGen plant.

"It makes sense to compare the numbers," he said.

"This information would be helpful to those making the federal decision (as to where to locate the plant)."