The AZEP (Advanced Zero Emissions Power Plant) project addresses the development of a novel “zero emissions,” gas turbine-based, power generation process to reduce local and global CO2 emissions in the most cost-effective way. Preliminary process calculations indicate that the AZEP concept will result only in a loss of 2–5% efficiency, as compared to approximately 10% loss using conventional tail-end CO2 capture methods. Additionally, the concept allows the use of air-based gas turbine equipment and thus, eliminates the need for expensive development of new turbomachinery. The key to achieving these targets is the development of an integrated MCM-reactor, in which a) O2 is separated from air by use of a mixed-conductive membrane (MCM), b) combustion of natural gas occurs in an N2-free environment and c) the heat of combustion is transferred to the oxygen depleted air by a high temperature heat exchanger. This MCM reactor replaces the combustion chamber in a standard gas turbine power plant. The cost of removing CO2 from the combustion exhaust gas is significantly reduced, since this contains only CO2 and water vapor. The initial project phase is focused on the research and development of the major components of the MCM-reactor (air separation membrane, combustor and high temperature heat exchanger), the combination of these components into an integrated reactor, and subsequent scale-up for future integration in a gas turbine. Within the AZEP process combustion is carried out in a nearly stoichiometric natural gas/O2 mixture heavily diluted in CO2 and water vapor. The influence of this high exhaust gas dilution on the stability of natural gas combustion has been investigated, using lean-premix combustion technologies. Experiments have been performed both at atmospheric and high pressures (up to 15 bar), simulating the conditions found in the AZEP process. Preliminary tests have been performed on MCM modules under simulated gas turbine conditions. Additionally, preliminary reactor designs, incorporating MCM, heat exchanger and combustor have been made, based on the results of initial component testing. Techno-economic process calculations have been performed indicating the advantages of the AZEP process as compared to other proposed CO2-free gas turbine processes.