Beshear Takes Back $400,000 Peabody Coal Grant

FRANKFORT, Ky. (AP) - Peabody Energy Corp. has agreed to return a $400,000 grant to the state after failing to make much progress on a feasibility study focusing on bringing a coal-to-liquid plant to western Kentucky.

Beshear asked the company to return the grant, which was awarded by former Gov. Ernie Fletcher last May, after Peabody failed to submit any progress reports or invoices on how it was spending the money.

"It just never took off," said Brad Stone with the Gov.'s Office of Energy Policy told the Lexington Herald-Leader. "The company never showed progress toward their deliverables."

Peabody spokeswoman Beth Sutton said the company is waiting to get a better sense of government regulations for coal-powered energy before moving forward.

The company originally told state officials it was considering building a $3 billion plant near Sturgis in Union County to convert regional coal into synthetic diesel fuel. Because Peabody owns a large amount of coal in the area, Union County Judge-Executive Jody Jenkins said residents hoped the plant would be built. Yet Peabody never settled on a specific site for the plant.

"They've kept it all pretty close to their vest on how much progress they're making," Jenkins said. "We were just waiting and trying to stay positive about it."

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