Judith is the Policy and Communications Manager of the CCSA
Two sides of the CCS coin
There have been a few interesting articles on CCS recently; firstly the Telegraph article “Lucky Britain to win 21st century jackpot from carbon capture”, 2nd September and yesterday the FT article “Carbon capture: Miracle machine or white elephant?”, 9th September.
Whilst it is obviously great that CCS is gaining increasing attention in the media, we need to look at the messages that these articles leave behind.
The Telegraph article struck a positive tone, talking about the significant opportunity that the UK has to become the CCS hub of Europe – as we have the unique combination of concentrated clusters of industrial activity and one third of Europe’s CO2 storage capacity under the North Sea. In contrast, the FT article leaves a slightly less positive taste in the mouth – questioning CCS technology, its cost and the many delays that have hampered CCS development.
Let’s be honest for a minute:
1.Technology: you can always improve technology, that’s not the issue. The question is, do we have the technology now to fit CCS to commercial-scale power stations? The answer is yes. In its parts; capture, transport and subsurface injection of CO2 is nothing new – lots of industries already capture and separate out CO2 (take for example gas processing that has to remove the CO2 to deliver a pure stream of gas). The US has been safely transporting CO2 by pipeline since the early 1970s and injection of CO2 is standard practice around the world for oil and gas companies looking to extract additional oil.
It’s true – we need to link these three parts together, but 22 large-scale projects around the world in construction or operation prove that this can be done – that’s a 50% increase in projects since 2010. New industries are waking up to the importance of CCS – for example the first large-scale CCS project in the iron and steel sector has begun construction in Abu Dhabi. What’s more, the world’s first power sector project to fit CCS to a coal-fired power station (Boundary Dam, Canada) is coming up to its first year of successful operation and is already surpassing expectations.
So really, the take-home message is: More of the same please; we need to get on and build more projects.
2. Cost: there’s no denying it, the early CCS projects will look expensive. These are large infrastructure projects requiring significant investment by both the public and the private sector. But why are they expensive? A large part of the costs involved in the early projects comes from laying down the transport and storage infrastructure that will be utilised by future power and industrial projects. For example, both CCS projects in the UK competition are proposing to lay pipelines that are able to carry eight times the CO2 volume required by the projects themselves – so there’s lots of space available for other emitters to capture their CO2 and link in to these existing pipelines. This will significantly reduce costs for the follow-on projects (the CCS Cost Reduction Task Force estimates that 48% of the CCS cost reduction potential comes from sharing infrastructure) and provide energy intensive industries with a genuine opportunity to decarbonise and move towards a more sustainable future.
This leads us to the obvious question of who will pay for CCS? Let’s take a step back for a minute and look at other low-carbon industries. To date, the UK has installed just over 9GW of offshore wind capacity – this has required Government subsidy of £2.7 billion per year since 2010 (equivalent annual CfD costs). Compare that with £100 million spent to date on the engineering studies of the two CCS competition projects (plus £30 million on CCS research & development) and it’s clear that CCS hasn’t been in receipt of anywhere near the same amount of subsidy as other low-carbon industries. Industry is fully committed to CCS – however a degree of confidence is needed that the Government is in this for the long haul. In the UK, we are really fortunate that the Government has introduced Electricity Market Reform and the Contracts for Difference, which provides a mechanism to reward generators of low-carbon electricity (including CCS) into the future. However, there are still uncertainties about how this CfD will work for CCS – and this creates some nervousness about the future of CCS beyond the competition.
Take-home message: Clear signals from Government over the long-term direction for CCS.
3. The big picture: sometimes it’s hard to see the wood for the trees. Governments can get so focused on the here and now – the short-term wins – that they fail to set out the policy that will get us to the end goal. To be clear, the end goal of mitigating climate change (whilst maintaining energy security and ensuring affordability) will not be easy, it will not be cheap and it requires all the low-carbon technology options we have available to us. It is hard to ignore all the evidence pointing to the fact that without CCS, tackling climate change will be extremely difficult – oh, and by the way, affordability goes out the window if CCS isn’t available.
Take-home message: tackling climate change will be hard and expensive, but only with CCS in the mix can we ensure the costs are kept as low as possible
There will come a day when CCS is the norm, when it is only natural to build a coal or gas-fired power station with CCS and where countries that are able to do so, will be home to CCS clusters where power and industrial facilities link into pipeline and storage networks (the Teesside Collective project gives a great insight into how this could work).
The onus is on all of us to make sure we get to this point so that CCS can become the success story we all know it will be.