A University of Newcastle research team will continue their work around carbon capture and storage technologies after winning a $290,000 grant.
The university says the research addresses one of the three carbon capture and storage technologies in development worldwide.
The team say the technology has the ability to reduce carbon emissions from an operating power station by up to 90%.
“Over 65 per cent of global electricity production is derived from fossil fuels, with demand expected to rise,” Emeritus Professor Terry Wall said.
“Low emission coal technologies are a critical step towards a sustainable energy future.”
Funded by the Australian Low Emission Coal R&D the project addresses Oxyfuel, a fossil fuel burnt in the presence of oxygen.
Wall said the technology will be tested at the Callide Power Station in Queensland, the first complete Oxyfuel facility in the world.
Wall said the facility is a great example of how carbon capture storage technology can be applied to an existing coal-fired power station to produce low emissions electricity generation.
Peabody chief executive officer Gregory Boyce recently touted the importance of developing greater carbon capture storage capabilities in Australia.
He explained that Australia could reduce its emissions by as much as 10 to 15 per cent if it migrates existing coal plants to the new cleaner technology.
“The plan calls for ensuring half of new generation globally comes from advanced supercritical coal plants.
“Commercialising carbon capture use and storage methods that prevent carbon from being released into the atmosphere, and deploying coal conversion technologies that produce liquid fuels and synthetic gas.”
However some claim recent budget cuts mean Australia will fall behind in the wide-spread implementation of the technology.
Half a billion dollars was chopped from the Carbon Capture and Storage Flagships program, to develop large-scale projects for storing carbon emissions from mining and energy projects.
The Budget papers say the remaining $1 billion funding will allow "at least one project to proceed beyond the feasibility stage".
The Australian Coal Association took aim at the changes saying the decision to cut funding for CCS Flagships program was ‘short sighted’.
“As a global community we are massively reliant on fossil fuels and CCS is the only proven technology that can substantially reduce emissions from carbon intensive industry.
"Not only is cutting CCS counterproductive from a climate perspective it also undermines the future strength of our coal export industry which delivers vital jobs and revenue for Australia,” the association said.