Tickers in this Article: ADES, HW, DOW, DD, GE, APA, WMV
"Clean coal" is typically put in the same box as military intelligence or good government - something everybody would like to see, but is ultimately about as good of an investment concept as unicorn ranches. Not for lack of trying, but many clean coal technologies have risen up and then faded away when the real-life results didn't match the lofty promises of controlled bench-top experiments and the cost advantages disappeared in a puff of smoke.

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All of that said, ADA-ES (Nasdaq:ADES) keeps trying to crack the code and recent test results have sent the stock back up sharply. The question still remains, though, whether this tiny Colorado company can succeed where so many have failed and where most of the world's chemical companies don't even see value in trying. (For related reading, see Can Business Evolve In A Green World?)

The Latest Hope
ADA-ES recently announced that a new technology called M45 showed some encouraging results in full-scale tests with refined coal. According to the company, M45 lowered NOx emissions by more than 20% and mercury emissions by more than 40%. As the company dutifully noted, this would qualify for special government tax credits that would arguably make the technology interesting from a commercial perspective.

Many Have Tried ... and Most Have Quit
If ADA-ES can turn this M45 technology into a commercially viable product, they will accomplish something relative rare - a so-called "clean coal technology" that actually makes it to market. Simply put, this has been an industry that has excited investors quite a bit more than it has utility operators or environmentalists.

Headwaters (NYSE:HW) once tried to build a business on the back of "synthetic fuels" that were basically chemically altered forms of coal. While tax credits made that business look promising for a while, the company eventually de-prioritized it in favor of going into the business of producing more environmentally sustainable building materials (though it still has a coal cleaning business and some other energy technologies).

Beyond Headwaters, there just are not that many names left to discuss - most of the companies that tried to be clean coal players are either bankrupt or penny stocks.

Where Is the Big-Name Support?
While bulls continue to flog the promise of clean coal, there is a big elephant parked in the middle of the room. Coal-burning plants are everywhere in the world and with renewed fears of nuclear energy, governments and utilities would dearly love to see a way to keep cheap coal generation in place but with less pollution. With such a huge potential demand, why aren't companies like DuPont (NYSE:DD) and Dow (NYSE:DOW) all over this opportunity?

To be fair, there have been a host of attempts from well-known companies to find "cleaner" (though not "clean") solutions. Dow and Alstom have worked on pilot plants that capture CO2, and Dow has also worked with the likes of China Shenhua (Nasdaq:CSUAY) in other similar projects. Likewise, DuPont, General Electric (NYSE:GE), Siemens (NYSE:SI) and ABB (NYSE:ABB) have been involved in pilot projects here and there and occasionally talk about "renewed interest" or "new commitments," but the reality is that there is either "no there, there" or the companies have implemented NSA/CIA levels of security around their projects.

Of course, there are still other peripheral projects that could pay dividends. Energy producers like Statoil (NYSE:STO) and Apache (NYSE:APA) have worked with using carbon dioxide to stimulate wells, and others like Albemarle (NYSE:ALB), MeadWestvaco (NYSE:MWV), and DuPont have made advances in sorbents that reduce various atmospheric emissions from burning coal. (To learn more, read For Companies, Green Is The New Black.)

The Bottom Line
ADA-ES is not widely followed or well-known yet but analysts are already expecting big things, including better than 50% compound revenue growth for the next two years. That's a big goal for a small company in an industry that has chewed up and spit out many would-be players. Maybe ADA-ES is the company that finally cracks the code and brings legitimate and viable technology to the market. But with such huge potential out there, investors may want to pause for a moment or two and wonder why it is that major chemical companies, with hundreds of millions (if not billions) of R&D power at their disposal, are not leading the charge in this technology.

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