The NY Times has an interesting article on the government subsidized boondoggle to build a zero-emissions coal plant.  First, we see all the usual aspects of what happens when the government steps in to fund non-economic projects no private investor would touch:

But choosing the location was perhaps the least daunting step. The project, announced by President Bush in 2003, seems to be in perpetual creep mode. The budget, as Matt Wald wrote yesterday, has ballooned 50 percent (because of the worldwide shortage of basics like cement). The timetable has slid. Components are being shed. The portion of the eventual $1.8 billion cost paid by the government is shrinking.

Though I have never studies the numbers in depth, it has been my intuition (from years working as an engineer with power plants and oil refineries) that it will be almost impossible to make this technology economic.  Apparently, others agree:

There are plenty of experts who still doubt that capturing carbon dioxide and putting it in cold storage will ever work at a meaningful scale. Vaclav Smil at the University of Manitoba has calculated that capturing, compressing and storing just 10 percent of current CO2 emissions — here and now — would require as much pipeline and plant infrastructure as are now used worldwide to extract oil from the ground. And oil is a pricey commodity while carbon dioxide is a waste gas.

Handling and compressing gasses are a lot more difficult than liquids, and liquefying them may take almost as much energy as you get out of the combustion.  So, what does the government do if a technology is so uneconomic and unworkable that it can’t even scrape up enough money to subsidize one plant?  Why, it mandates the technology:

Mr. Hawkins said adequate construction of CO2-trapping plants would happen more swiftly if a “performance standard” requiring this technology were added to climate legislation like the Warner-Lieberman bill being considered in the Senate. Such a provision would require new coal-plant construction to incorporate such systems and spread the cost over the economy so utilities aren’t hit too hard.

Such a mandate would effectively end the construction new coal plants, which may in fact be the motive of supporters. 

This is what happens when government tries to pick winning technologies.  If carbon combustion is really bad (a proposition with which I do not agree) then a carbon tax needs to be instituted, so that individuals can figure out on their own which carbon combustion is the most economic to eliminate and with what technologies.  If the government insists on picking winners with subsidized technology programs, then nuclear strikes me as much more fruitfull, as it is already proven and close to economic and investment can be concentrated on marginal problems like waste disposal, rather than fundamental problems like "will this approach even work."