Carbon Capture & Storage (CCS) has long been labelled as a key component of any future energy strategy devised at global, EU or national level. The EU has been intent on creating a commercially viable CCS project by 2020 in order to fuel growth, jobs, exports, and help set future emission targets for 2030 and beyond. CCS aims to capture the CO2 emitted by large-scale power plants and industrial centres (such as steel). Stored in underground sites, both on land and sea, potentially taking billions of would-be carbon units out of the atmosphere for (to put it mildly) an incredibly long time. In 2000, the EU set out a grand plan to create 12 commercially viable and operational CCS projects across the EU by 2015. So far, none have come to fruition. With the 2020 deadline fast approaching, industry, the public, and politicians need to understand the issues and importance of CCS for a balanced, and sustainable, energy secure future across the member states.
There are currently 75 on-going CCS projects worldwide, mostly concentrated in the US and EU (24 and 21 respectfully), with 8 projects in the EU currently working (though none commercially), 9 on hold or waiting to start, and 5 shut down for numerous financial, political and social reasons. These are not good statistics when looking at the original goal for 2015. Even more damming, or worrying, was the recent closure (September 2013) of the high-profile Norwegian Mongstad plant which was, in all but name, the flagship CCS project for the EU in terms of private investment, structural funds, political capital and industry-wide goodwill. This $1bn project was closed as the cost of capturing, transporting and storing the carbon units collected were deemed untenable in the long-term.
With the recent IPCC report once again emphasising the risk of the earth’s temperature rising above 2C (agreed at the 2009 Copenhagen summit), and the PWC publication stating that the world is set to blow through the recognised carbon ceiling for this 2C rise by 2034 (not 2100 as predicted over a decade ago), it is even more imperative that CCS is given the political and financial will to succeed. We’ve built our global economy, infrastructure, and way of life on fossil fuel technology, there is no quick fix through renewable energy initiatives (which I wholeheartedly support). To put it simply, renewable initiatives are just not as efficient in terms of gross output to satisfy our current (and predicted) demand. Governments are wrestling with the triple issue of: weaning our energy consumption away from fossil fuels (which are at an all-time market low price), investing in renewable energies (still expensive and requiring large land-mass), maintaining affordable energy pricing (with volatile world markets), ensuring energy security (from market volatility and aggressive international situations), meeting legally binding CO2 emission targets, whilst trying to generate economic growth – oh, is that more than 3 issues? The situation is delicate to say the least.
CCS is not the answer to our future energy strategy, but it is definitely a solution which needs to be figured out quickly. CO2 is a long-lasting gas. In 20 years’ time, 60% of the CO2 output from 2013 will still be in the atmosphere. If we can limit even half of this, our goal of maintaining a 2C temperature rise is achievable. But just to emphasise the dramatic turn-around required by the world, not just the EU, on CCS: a recent study stated that if all CCS plants currently live operated at full capacity (by which we mean were commercially viable as projects), only 1% of 2012 worldwide emissions would be caught. The IEA stated that we need at least 100 working, fully operational CCS plants by 2020 and 3000 by 2050 to maintain this target. The EUs goal of achieving 1 working plant, which in itself is a world leading objective, somehow looks a bit weak.
So why has CCS failed so dramatically? It’s been mooted, supported, legislated and financed. There is a worldwide collective will to be the first to achieve a working plant – the exports of a fully commercial technology and skilled engineers alone would be a tremendous economic boost. Simply put, the issues are threefold:
Finance – The EU Emissions Trading System has flopped, the price at which carbon units (per tonne) can be bought was recorded at just $4.97 last month. Even with the recent EU agreement to boost the cost of the EU ETS, the equivalent unit via CCS is predicted to be $50 (at best). Industry is just not interested or financially driven to move CCS forward.
Regulation – Carbon trading is a global issue, yet there is a huge disparity on policies from country to country, continent to continent (most usefully signified by the aviation dispute for the EU ETS), and multi-national companies can threaten to pull out of a region if faced with excessive costs. A global deal across all industries – incorporating steel, shipping, aviation, and manufacturing (to name a few) is needed. Specifically, current EU legislature outlines how any storage company is responsible for the gas for 20 years, at which point it is transferred to the national government to care for. Neither party likes or accepts this arrangement.
Social – Local authorities, understandably, don’t want gas stored indefinitely under their land. Couple this with a preconception of CCS as a negative energy storage device, due to its reliance on fossil fuels to work, and you have a hard case to win support for it in any constituency.
Even with these issues, CCS must, in my view, be driven though. Not as a solution for the energy sector, but as a make-weight as we slowly come to terms with the cultural and infrastructure shift which is required from us all. The UK is currently developing 2 commercialisation projects with EU funds: the Peterhead Project and the White Rose development with significant government support for both. It also recently negotiated a 10 year R&D deal with China on CCS. With the closure of the Mongstad plant, and the reluctance of the Norwegian government to further CCS development, coupled with growing disinterest in the US sector due to their shale gas boom. The UK is now leading the charge for this technology. Let’s see whether the 2020 goal is a pipedream, or a reachable target. Only time will tell.