The Railbelt might not have a diverse energy supply, but it does have diverse energy prospects. Companies are in the early stages of new wind farms, geothermal wells and alternative forms of hydropower. But fossil fuels are diversifying, too. When there's nothing in the fridge, you have to get creative with what you find in the pantry.

One interesting trend that popped up this year is Underground Coal Gasification, a way to make gas in deep coal deposits. Underground Coal Gasification, or UCG, works because coal contains carbon that can be manipulated through chemical processes into a gas. That gas can heat buildings and make electricity, or be liquefied for other uses with carbon emissions roughly equal to natural gas, and certainly better than coal alone.

That description is heartening for two reasons. First, declining natural gas production in the Cook Inlet means alternative fuels that fit easily into the existing system will be welcome over the next few years. Second, Alaska is rich in coal reserves, surpassing all other states combined, but hasn't been able to use most of it because the deposits are either too far away or too deep underground, or because of opposition to coal mining.

At least three groups are now proposing UCG projects in Alaska. The farthest along could begin operations by 2015, around the time natural gas production in the Cook Inlet is projected to dip below regional demand in Southcentral. That gives Alaska several years to study a technology that promises large benefits, but that hasn't received as much attention as other alternative ways of wringing cleaner burning energy from fossil fuels.

Once loved, and loved again

UCG is not new, just overlooked. Sir William Siemens, a German scientist, proposed the idea in the 1860s. Soviet scientists began researching the technology in the late 1920s and began commercial operations in the 1950s, but let production decline in the 1970s.

In this country, UCG research and development waxes and wanes with public concern about energy. Between 1974 and 1989, following the oil embargo, the U.S. Department of Energy helped fund 33 UCG pilot projects, according to a September 2009 report on various low carbon coal technologies by the non-profit Clean Air Task Force.

That support began to dry up, though, when oil prices fell in the late 1980s.

"When low cost gas is abundant, people are uninterested in UGC," said Dr. Julio Friedmann, head of the Carbon Management Program at the Lawrence Livermore National Laboratory in California and author of the chapter on UCG in the Clean Air Task Force report. The LLNL participated in many of those initial pilot projects and is currently acting as a technical advisor to one of the UCG project sponsors in Alaska.

Friedmann said refined syngas, the product created through UCG, currently costs around $3 per million British thermal units of energy in most markets. That would make it cheaper than natural gas in both Anchorage and Fairbanks, and well below fuel oil.

Because UCG hasn't been a priority in decades, each new project requires the attention of a limited group of experts. Friedmann said that this knowledge gap should justify a federal research program, but isn't cause for public alarm. It does, however, present regulatory challenges for Alaska, which knows coal and gas, but not a mix of the two.

On the surface, UCG looks like a normal oil or gas project, except it uses two wells instead of one. The first well blows air into a coal seam. That produces heat underground that begins a chemical reaction. It reconstitutes the hydrogen, oxygen and carbon in the seam into a gas containing hydrogen, carbon monoxide, carbon dioxide and methane.

This mixture is produced through the second well, where it's refined and used.

UCG is different from Coal Bed Methane, a coal-gas hybrid process that riles many for water use and potential to contaminate water supplies. In Coal Bed Methane development, natural gas is extracted from shallow coal seams by removing large amounts of groundwater holding it in place. That creates a lot of water to dispose of, and also presents the possibility of contaminating drinking water if things don't go right.