Peabody Energy (BTU) has partnered with China on that country's GreenGen project. The facility is a combination of a research hub and an advanced coal-fired utility using coal gasification, combined cycle technology, and carbon capture. As countries around the world look for energy alternatives, GreenGen and similar initiatives show that there's still a future for "dirty" carbon fuels.

Working on the future now
China is the largest consumer of coal in the world. The vast size of the country and its quick economic ascent create a huge need for power and, thus, coal. Although the country is also investing in natural gas and nuclear utilities, coal is set to play a key role in China's future.

However, pollution concerns have made coal something of a problem in the country. But that doesn't mean China is giving up on the relatively cheap and abundant fuel—it's just taking a more deliberate approach. A key part of that is GreenGen, a test plant using cutting edge technologies.

The interesting thing about China is that the technology doesn't need to be all that profitable for the authoritarian government to mandate its use. And Peabody, the only non-Chinese partner in the project, is clearly setting itself up to benefit from coal demand in the country. That includes the thermal coal supply deal it just inked with Shenhua Group.

Not the only one...
China isn't alone in this effort. U.S. utility Southern Company (SO -1.56%)

Duke Energy's (DUK -1.33%) Edwardsport power plant comes closest using coal gasification and combined cycle technologies (essentially, this means making use of the excess heat from the plant). It proves that piece of the puzzle; Southern is taking it to the next level by adding carbon capture. Although the technology in all of this is fascinating, don't forget that Duke now has a 600 megawatt coal-fired plant providing reliable base-load power. And it's one of the cleanest coal plants in the country.

Once Southern is done with Kemper it will be able to boast a similar claim. Interestingly, Southern is part owner of the technology it is using, along with partner KBR (KBR 0.09%). The two are taking a big risk with this project, but the payoff could be huge. And China's efforts with GreenGen prove there is a big market for clean coal technology.

So do efforts to clean up carbon based fuels in other countries like India and the United Kingdom—note that carbon capture has applications beyond coal. Although royalties from Kemper technology sales would be icing on the cake for Southern, KBR really stands to benefit. Having a fully functioning power plant using its suite of clean coal technologies could make this engineering and construction company a go-to player in the utility space.

While that may not be so exciting in the U.S. market, which is awash in cheap natural gas, growing countries around the world still need to spend heavily on energy infrastructure. And Southern and KBR are quick to point out that natural gas isn't nearly as cheap overseas. China and India are two large and important markets, but they aren't the only ones that KBR could target. Fast growing Indonesia, for example, has plenty of low-quality coal that KBR's technologies could turn into clean power.

If you build it they will come
Technology improves over time and costs come down. Duke and Southern took on the risks and costs of being first movers. With other countries around the world, like China, working toward the same goal, it shouldn't be long before clean coal technology is a reality. Watch this space—and if you don't want to own a coal company or a utility, consider industrial technology players like KBR, General Electric (GE 0.68%), and Siemens (SIEGY 2.23%).

Or how about automakers than can also profit from Chinese demand?