CCS sidelined by tenuous financing

High time to search for solutions elsewhere. Photo: gregoirevdb/flickr.com/CC BY-NC-ND

Carbon, capture and storage (CCS) has still not proven to be anything else than an inordinately expensive technology on an experimental level. Nevertheless the European Commission continues to embrace it.

New coal powered plants are still constructed in the EU and could still be operating in 2050, even though it would be totally inconsistent with the 80 percent CO₂ reduction has been targeted for that time referred to 1990. Rather than phasing out fossil fuels, however, the European Commission is resolved to “decarbonise” power stations and heavy industry using carbon capture and storage (CCS).

This technology is regarded essential e.g. by the EU Commission for limiting global warming to 2°C if coal dependency is not abandoned. Yet the decarbonisation objective must be implemented worldwide, since Europe is responsible for only 11per cent of all CO₂ emissions.

Estimates of the International Energy Agency (IEA) indicate that equipping 3,400 power plants and industrial facilities with CCS could provide 19 per cent of the total CO₂ avoidance required by 2050. However action will be needed before 2030, since the maximum two-degree 1,000 billion tonne CO₂ budget calculated by the Zürich Technical Institute (ETH) for 2000 – 2050 would be exceeded by that time on the current emissions trajectory. The necessary pace of implementation translates to a new CCS power plant or factory built every two days over the next 18 years. Adequate geological and logistical prerequisites for CO₂ storage remain highly questionable at the scale required.

This perspective also neglects over 1,100 coal power plants counted by the World Resources Institute that are currently being designed or built without CO2 capture. Three quarters of the projects are located in China and India, where the absence of economic justification precludes CCS implementation.  

In a report presented in April 2013 to the “Clean Energy Ministerial” (governments representing 80 per cent of global CO₂ emissions), the IEA has conceded that there are now only 13 large-scale CCS demonstration projects worldwide, and not one commercial plant with carbon dioxide separation.  

The prospects for CCS are impeded in North America by inexpensive natural gas with inherently low CO₂ emissions. In Europe, renewable energies are narrowing profit margins for coal generation. CCS is additionally burdened by high equipment costs and incalculable risks. The CO₂ forced into deep sandstone formations must overcome the fluid resistance of native brine formations. Wide-area subterranean pressurisation may cause earth tremors or extrude saltwater through geological faults into overlying freshwater aquifers.

The Swedish state power corporation Vattenfall forecast in 2001 that an “avoidance cost for a whole system” of “about 30 €/ton of CO₂” could ultimately be achieved. CCS investments were to be offset by the EU Emissions Trading Scheme (ETS), affirmed by Directive 2009/29/EC to be “a predictable path” for controlling emissions. However, the IEA has since estimated CCS costs of US$50–65 /tCO2 by 2030 for coal combustion and up to US$90 for gas-fired power plants. By contrast, ETS prices are languishing below €5/tCO2. The European Commission concluded on 27 March 2013, that at “current ETS prices well below €40/tCO₂, and without any other legal constraint or incentive, there is no rationale for economic operators to invest in CCS”.

The Earth’s atmosphere will thus remain a no-charge CO₂ repository unless alternative decarbonisation strategies can be implemented. Yet carbon taxes imposed for this purpose would restrict the development of EU energy-intensive industries, many of which are proving more cost-effective in North America due to abundant shale gas and oil.  

On 10 October 2012, the Commission responded to this challenge by announcing “a number of priority actions to stimulate investments in new technologies” for bringing industry back to Europe. However, the only way to promote this objective in line with CO₂ reduction targets will be to discontinue coal plant construction in favour of renewable energies. Continuing on a CCS path would raise the cost of doing business in the EU and obstruct the progress of sustainable global decarbonisation.

Jeffrey Michel

The report Lost hopes for CCS – added urgency for renewable energy, APC No. 28 (June 2013) by Jeffrey Michel

For more information:

Last Gasp of the Coal Industry, APC No.21  and Carbon Capture and Storage in Norway, APC No. 22 

EU is discussing CCS: On 27 March 2013, the European Commission launched a consultative communication on the future of Carbon Capture and Storage (CCS) in Europe under the title Clean Coal Technologies. The EU announced that the purpose of the Communication is to “initiate a debate on the options available to ensure CCS timely development and that CCS is needed to reduce greenhouse gas emissions and to enable fossil fuels to remain an integral part of the energy mix in the EU”.
Contributions should be sent by 2 July 2013 to:
European Commission
Directorate General Energy
Unit C1  – Renewables and CCS
Rue De Mot 24, B-1049 Bruxelles
Belgium
E-mail : ENER-CCS-COMMUNICATION