CS

Carbon Capture and Storage

Carbon capture and storage is a viable mitigation strategy for current and future fossil fuel emissions.

By 2020, deliver improved understanding of the role of Carbon Capture and Storage (CCS), real change in the recognition of CCS in national and international policy and ideally, a Final Investment Decision (FID) on at least one major for-profit project.

No more than 1 trillion tonnes of carbon can be released by human activities if we are to limit warming to 2°C, the current global goal. Significantly exceeding this amount of cumulative emissions introduces unacceptable risk into the climate system. Current cumulative emissions now stand at ~570 billion tonnes of carbon, and the expected future demand for fossil fuels will likely result in an overshoot. Energy-focused mitigation approaches seek to supplement the global energy system with clean energy or make energy use more efficient, both important objectives, but these actions do not address emissions from the existing and future fossil fuel base that will continue to meet core global energy demand for much of this century. This can only be done by capturing CO2 at source and geologically storing it. Deployment of CCS – with an early focus on large-scale demonstration of the technology in carbon intense (emerging) economies – is game changing in the context of actually reducing global emissions. Yet in policy circles, CCS is often the “poor cousin” to other well funded and popular initiatives. Its critical mitigation role is sometimes poorly understood or incorrectly communicated, to the extent that, at least in the important power generation sector, there is not a single large-scale project in operation today. Only a handful of projects are in development for industrial applications.

Although the technology is well understood and comprises a number of mature sub-technologies currently in operation in the oil and gas industry, integration, infrastructure and experience are lacking. For this reason, first implementation, while clearly possible from a technology and engineering standpoint, will be more expensive than later deployment.

The Business Case

CCS is a pure CO2 mitigation technology, in that the only reason for doing it is to reduce emissions. As such, it relies entirely on a policy construct to trigger the necessary investment. This typically takes the form of a sufficiently high carbon price, a mandate or standard of some type.

Over time governments are expected to implement policies that require CCS, which then argues for a robust technology, policy, legal and infrastructure pathway to be implemented now. That preparatory step to widespread deployment will require both public funding and initial policy development to attract large-scale project developers. If such steps are not taken now, future energy supply could be disrupted as governments find themselves in the situation of having to force the implementation of CCS on a society that is not fully ready for it.

Several attempts have been made to drive policy in the direction of CCS. The most recent example is in the EU through the NER300, a funding mechanism linked to the EU ETS. In 2008/9, with an EU carbon price of €20-30 and therefore some €6-9 billion in CCS funding available, many projects were in the offing. The subsequent collapse in carbon prices saw developers retreat.

Timeline

Now

  • Establish CCS business solution team and co-chairs.

  • Seek key members w/long-term CCS development interest.

  • Identify and establish partnerships.

2015-16

  • Develop communications toolkit or use/re-use existing material.

  • Identify target countries and potential interest for early demonstration of CCS.

  • Design policy pathways.

2018

  • Major advocacy effort.

2020

  • Project interest and FID.

Enablers

  • Forming partnerships. Need to build synergy with CCS-focused organizations.

  • Finding champions. Identify key political figures, high-profile individuals, etc. who will back the need for CCS and identify with it.

  • Financing. Major funding mechanisms, such as GCF, need to focus on CCS and build key metrics around financing it.

  • Engaging with national and international policymakers. Initially focus on building understanding and creating the desire.

Barriers

Knowledge

  • Lack of understanding of the critical role of CCS.

  • Prevailing view that it “doesn’t work” or “hasn’t been tested.”

  • Seen as difficult to implement with complex policy requirements.

Risk / Reward

  • CCS requires absolute belief that a long-term policy framework will be in place as there are no ancillary benefits from a CCS project; it will just reduce CO2 emissions.

Money / Financing

  • Capital intensive, particularly the early projects where core infrastructure must be included.

  • Once built, it requires ongoing costs to deliver reductions, including an energy penalty.

Relevant priority areas

Jointly developed with: