The DOE is moving ahead with an interesting new coal process called Coal Direct Chemical Looping (CDCL) developed at Ohio State University. (Fox News had a blurb so I tracked down information about the new process.) Babcock PDF on CDCL A quick summary is that the goal is to burn coal and seperate out the CO2 stream with less than a 35% cost increase, which is difficult because conventional combustion leaves the CO2 mixed with sulfur dioxide, mercury, steam, and most of all lots of atmospheric nitrogen, and seperating it out is difficult (expensive in money and energy). So instead they run what is essentially an iron furnace, mixing coal with iron oxide (Fe2O3) at temperature in the normal reduction reaction, where the oxygen to react with the coal comes from the iron oxide and the output is metalic iron (in this case a mix of Fe and FeO) and CO2 (plus a small trace of methane and steam since coal isn't pure carbon), so the exhaust from this first step is almost pure CO2, as desired for sequestration and other uses. Step 1 is basically an iron foundary. The next step is clever. To generate electrical power they burn the iron back to iron oxide, which doesn't generate any CO2, mercury, or anything else. It just turns iron back into rust with a huge heat output for steam generation. Then they take the rust and dump it back into first reaction vessel to keep the whole cycle going. The efficiency penalties are small, hardly worse than a conventional non-clean coal plant, and it comes out much cheaper than the clean alternatives.