Tag Archives: CCS

Hydrogen and electricity for low carbon heat

Hydrogen and electricity are competing carriers, and there may be a role for both in providing low carbon heat.

There has recently been a lot of interest in the role of hydrogen as a carrier of low carbon energy, because it produces no CO2 on combustion (or oxidation in a fuel cell).  This is the first of three posts looking at hydrogen and how it might compete with electricity to provide low carbon heat.  Hydrogen and electricity may also compete in transport, but that is a large subject in its own right and will need to await further posts.

This first post outlines some of the possibilities and the issues raised.  The next post will compare electricity with hydrogen for heating in buildings.  The third post will look at the ways they may complement each other to supply heat.

There are broadly two main sources of primary energy for low carbon heat:

  • Fossil fuels with CCS, which I’ve assumed in these posts will usually be natural gas.
  • Renewables, likely in practice to be mainly wind and solar.

Each of these primary energy sources can get to the energy consumer in the form of electricity or hydrogen.  Wind and solar can produce low carbon electricity directly, or they can produce hydrogen via electrolysis of water.  Natural gas can be burnt in a CCGT to produce electricity.  It can also be processed to produce hydrogen, most commonly in a steam methane reformer (SMR).  I’ve assumed here that SMRs are used, although many are looking at alternative approaches such as autothermal reforming (ATRs) which may allow for higher efficiencies and capture rates.

If fossil fuels are used CCS is required, as both CCGTs and SMRs produce CO2.  This means they provide low carbon energy, rather than a zero-carbon energy, as a maximum of 90-95% of the CO2 produced is captured.  Any CCS built now or in the future will likely still be in use by 2050, so its capture rate must be judged against 2050 net-zero targets.  In this context, the residual emissions from any large-scale use of CCS for fossil fuels are likely to be significant, and may place limits on the extent of deployment.  SMRs produce different streams of CO2. Some of this is concentrated and so relatively easy to capture, some is more dilute.  Both streams need to be captured for the technology to play an appropriate role in a net-zero carbon economy.

Both CCGTs and SMRs also produce waste heat, which may be used, so improving the overall thermal efficiency, although applications to date have been limited.

Hydrogen can be converted into electricity using a fuel cell or CCGT (with appropriately designed turbines).  This may enable use of hydrogen for electricity storage.

Electricity for building heating is likely to come from heat pumps (likely mainly air source heat pumps) as these greatly improve efficiency.

This gives a variety of routes for primary energy to low carbon end use. These are shown in the diagram below.  In practice several of these may co-exist, and some may not happen at scale.  The pathways shown assume natural gas cannot continue to act as a carrier of energy to individual buildings.  This is because its combustion inevitably produces CO2 and very small-scale CCS for individual buildings is likely to prove impractical, for example because of the very extensive CO2 transport network that would be required.

Both fossil fuels and renewables can deliver energy as electricity or hydrogen …

Which mix of these pathways will provide the best solution? It’s not yet clear.  It will depend on various factors.

Suitability for end use.  Some industrial processes require high temperature heat or a direct flame, which heat pumps cannot provide.  Conversely, hydrogen needs to demonstrate its safety in a domestic context, though this is likely tractable.

Consumer acceptability. This is critical for residential heating, and both hydrogen and heat pumps face potential difficulties.  For example, heat pumps may be perceived as noisy, or require modifications such as installation of larger radiators which people resist.

Costs.  Which route is cheaper depends on a wide range of factors, including :

  • The capital costs of the equipment (e.g. CCGT or SMR, hydrogen boilers, and heat pumps)
  • The costs of reinforcing, creating or repurposing grids, including the extent to which the natural gas gird can be repurposed for hydrogen, and the cost of reinforcing the electricity distribution network to accommodate demand from heat pumps.
  • The cost of the primary energy, for example whether renewable energy is produced at times of low demand so might be available at a low price. If electricity from renewables is available very cheaply then resistance heating without heat pumps may make sense in some cases.
  • The thermal efficiency of the processes, for example the extent to which CCS adds costs by requiring additional energy, and the coefficient of performance (heat out divided by electricity in) for heat pump, especially in winter.
  • The costs of electricity storage via batteries or as hydrogen.
  • Load factor for heat and electricity production.

Many of these variables are uncertain.  They also vary with location and over time. The very large cost falls for renewable electricity demonstrate the need for caution in judging options on present costs.

In my next post I will take a look at how these factors may play out for building heating in the UK, and will consider the policy implications.

Adam Whitmore – 30th September 2019

 

 

How well is the UK on track for zero emissions by 2050?

By 2020 the UK will have very nearly halved its emissions over 30 years.  Reducing emissions by the same amount over the next 30 years will get the UK very close to zero.  However this will be very much more difficult.

A robust net zero target has been recommended for the UK …

A recent report by the UK’s Committee on Climate Change (CCC), the Government’s official advisory body, recommends that the UK adopts a legally binding target of net zero emissions of greenhouse gases by 2050[i], that is remaining emissions must be balanced by removal from the atmosphere.  If the Government agrees, this will be implemented by amending the reduction mandated by the Climate Change Act, from an 80% reduction from 1990 to a 100% reduction.

The target has several features that make it particularly ambitious.  It:

  • sets a target of net zero emissions covering all greenhouse gases;
  • includes international aviation and shipping;
  • allows no use of international offsets; and
  • is legally binding.

This is intended to end the UK’s contribution global warming.  It has no precedents elsewhere, although in France a bill with comparable provisions is under consideration[ii].

Progress to date has been good …

The UK has made good progress so far in reducing emissions since 1990.  Emissions in 2018 were around 45% below 1990 levels, having reduced at an average rate of about 12.5 million tonnes p.a. over the period.  On current trends, over the thirty years from 1990 to 2020 emissions will be reduced to about 420 million tonnes p.a., 47% below their 1990 levels.  Emissions will thus have nearly halved over the 30 years 1990 to 2020, half the period from 1990 to the target date of 2050.

Chart 1 shows how the UK’s progress compares with a linear track to the current target of an 80% reduction, to a 95% reduction and to a 100% reduction.  (For simplicity I’m ignoring international aviation and shipping).  The UK is currently on a linear track towards a 95% reduction by 2050.

Chart 1: Actual UK emissions compared with straight line progress towards different 2050 targets

 

Source: My analysis based on data from the Committee on Climate Change and UK Government.  Data for 2018 is provisional[iii]

The largest contributor to the total reduction so far has been the power sector.  Analysis by Carbon Brief[iv] showed that the fall in power sector emissions has been due to a combination deploying renewables, which made up about of third of generation in 2018, reducing coal use by switching to natural gas, and limiting electricity demand growth.

Industrial emissions have also fallen significantly.  However some of this likely represents heavy industry now being concentrated elsewhere in the world, so likely does not represent a fall in global emissions.  Emissions from waste have also fallen, due to better management.

Reducing emissions will be relatively easy in some sectors …

There are also reasons for optimism about continuing emissions reductions.  Many technologies are now there at scale and at competitive prices, which they were not in previous decades.  For example, falling renewables costs and better grid management, including cheaper storage, will help further decarbonisation of the power sector.  Electrification of surface transport now appears not only feasible, but likely to be strongly driven (at least for cars and vans) by economic factors alone as the cost of batteries continues to fall.

But huge challenges remain …

Nevertheless important difficulties remain for complete decarbonisation.

CCS is identified by the report as an essential technology.  However, as I have noted previously, it has made very little progress in recent years in the UK or elsewhere[v].  CCS is especially important for decarbonising industry.  This includes a major role for low carbon hydrogen, which is assumed to be produced from natural gas using CCS – although another possibility is that it comes from electrolysis using very cheap renewables power, e.g. at times of surplus.  CCS also looks to be necessary because of its use with bioenergy (BECCS), to give some negative emissions, though the lifecycle emissions from this will require careful attention

Decarbonising building heating, especially in the residential sector, continues to be a challenge.  The report envisages a mix of heat pumps and hydrogen, perhaps in the form of hybrid designs, with heat pumps providing the baseload being topped-up up by burning of hydrogen in winter.  I have previously written about the difficulties of widespread use of heat pumps[vi], and low carbon hydrogen from natural gas with CCS is also capital intensive to produce and therefore expensive to run for the winter only.  The scale of any programme and consumer acceptance remain major challenges, and the difficulties encountered by the UK’s smart meter installation programme – by comparison a very simple change – are not an encouraging precedent.

Emissions from agriculture are difficult to eliminate completely, and no technologies are likely to be available by 2050 that enable aviation emissions to be completely eliminated.  This will require some negative emissions to balance remaining emissions from these sectors.

Policy needs to be greatly strengthened …

Crucially several of the necessary transformations are very large scale, and need long lead times, and investment over decades.  There is an urgent need to make progress on these, and policy needs to recognise this.  This includes plans for significant absorption from reforestation, as trees need to be planted early enough that they can grow to be absorbing substantial amounts by 2050.

The UK’s progress on emissions reduction so far has been good, having made greater reductions than any other major economy[vii].  And technological advances in some areas are likely to enable substantial further progress.  However much more is needed.  In particular policy needs to look now at some of the difficult areas where substantial long-term investment will be needed

Adam Whitmore – 22nd May 2019

 

 

[i] https://www.theccc.org.uk/2019/05/02/phase-out-greenhouse-gas-emissions-by-2050-to-end-uk-contribution-to-global-warming/

 

[ii] The CCC report notes that Norway, Sweden and Denmark have net zero targets, but they allow use of international offsets (up to 15% in the case of Sweden).  France has published a target similar to the UK’s in a bill.  The European Commission has proposed something similar for the EU as a whole, but this is a long way from being adopted. California has non-legally binding targets to achieve net zero by 2045.  Two smaller jurisdictions (Costa Rica, Bhutan) have established net zero targets but these are expected to be achieved mainly by land use changes.  New Zealand has a draft bill to establish a target, but eliminating all GHGs will be difficult because of the role of agriculture in the New Zealand economy.

 

[iii] https://www.gov.uk/government/statistics/provisional-uk-greenhouse-gas-emissions-national-statistics-2018  The change from 2017 to 2018 is applied to the data series from 1990 produced by the CCC (the two data series differ very slightly in their absolute levels).

 

[iv] https://www.carbonbrief.org/analysis-uk-electricity-generation-2018-falls-to-lowest-since-1994

 

[v] https://onclimatechangepolicydotorg.wordpress.com/2018/04/25/a-limited-but-important-medium-term-future-for-ccs/

 

[vi] https://onclimatechangepolicydotorg.wordpress.com/2015/05/18/reducing-the-costs-of-decarbonising-winter-heating-needs-to-be-a-priority/

 

[vii] https://onclimatechangepolicydotorg.wordpress.com/2017/05/09/uk-emissions-reductions-offer-lessons-for-others/

 

Underestimating the contribution of solar PV risks damaging policy making

A brief update on this post can be found here https://onclimatechangepolicydotorg.wordpress.com/2019/01/21/the-ieas-solar-pv-projections-are-more-misleading-than-ever/

Underestimating the contribution of solar PV risks damaging policy making

The continuing lack of realism in projections for solar PV risks damaging policy making by misdirecting effort in developing low carbon technologies.

Solar PV continues its remarkable growth …

Electricity generation from solar PV continues to grow very rapidly.  It now supplies over 1% of global electricity consumption and this proportion looks set to continue growing very rapidly over the next decade as costs continue to fall.

Chart 1 Rapid growth of solar PV generation continues

Sources: BP statistical review of world energy [i].  1% of consumption based on data for generation with an adjustment for losses.

Many studies have underestimated this growth and continue to do so …

This growth has been much faster than many predicted.  In 2013 and again in 2015  I noted[ii] that the IEA’s annual World Energy Outlook (WEO) projections for both wind and solar PV were consistently vastly too low.  Specifically, the IEA’s projections showed the annual rate of installation of wind and solar PV capacity remaining roughly constant, whereas in fact it both were increasing rapidly.  Updated analysis for solar PV recently published by Auke Hoekstra[iii] shows that this position seems remarkably unchanged (see Chart 2).  The repeated gross divergence between forecasts and outturns over so many years makes it hard to conclude anything other than the IEA is showing a wilful disconnection with reality in this respect, though their historical data on the energy sector remains very valuable.

Chart 2:  IEA projections for solar PV capacity continue to vastly underestimate growth

Although the IEA’s projections are particularly notable for their inability to learn from repeated mistakes, others have also greatly underestimated the growth of solar PV[iv].    Crucially, as a recent study in Nature Energy[v] shows, this tendency extends to many energy models used in policy making, including those relied on by the IPCC in its Assessment Reports.

This is largely because models have underestimated both the effect of policy support on deployment and the rate of technological progress, and so have underestimated the resulting falls in cost both in absolute terms and relative to other technologies.  Where new information has been available there has often been a lag in incorporating it in models.  Feedbacks between cost falls, deployment and policy may also have been under-represented in many models.  Consequently models have understated both growth rates and ultimate practical potential for solar PV.

This damages policy making  …

Does this matter?  I think it does, for at least two reasons.

First, if policy is based on misleading projections about the role of different technologies then policy support and effort will likely be misdirected.  For example, means of integrating solar PV at very large scale into energy systems look to have been under-researched and under-supported.  Other low carbon technologies such as power generation with CCS may have received more attention in comparison to their potential[vi].

Second, there is a risk of damaging the policy debate.  In particular there is a risk of exacerbating polarisation of the debate, rather than creating a healthy mix of competing judgements.  There is already a tendency for some commentaries on energy to favour fossil energy sources, and perhaps nuclear, and for others to favour renewables – what one might call “traditionalist” and “transitionalist” positions.  Traditionalists, including many energy companies, tend to point to the size and inertia of the energy system and the problems of replacing the current system with new sources of energy.  Transitionalists, including many entrepreneurs and environmentalists, tend to emphasise the urgent need to reduce emissions, the speed of change in technologies and costs now underway, and the exciting business opportunities created by change.

Both perspectives have merit, and the debate is too important to ignore either.  The IEA provides an example of distorting the debate. It will naturally, due to its history, tend to be seen as to some extent favouring the traditionalist viewpoint.  If this perception is reinforced by grossly unrealistic projections for renewables it risks devaluing the IEA’s other work even when it is more realistic, leaving it on one side of the debate. An opportunity for a balanced contribution from a major institution is lost.  The debate will be more polarised as a result, risking misleading policy makers, and distorting policy choices.

Securing balanced, well informed debate on the transition to a low carbon energy system is quite challenging enough.  Persistently underestimating the role of a major technology does not help.

Adam Whitmore -26th September 2017

 

 

[i] http://www.bp.com/content/dam/bp/en/corporate/pdf/energy-economics/statistical-review-2017/bp-statistical-review-of-world-energy-2017-renewable-energy.pdf

[ii] For details see here, here and  here

[iii]  https://steinbuch.wordpress.com/2017/06/12/photovoltaic-growth-reality-versus-projections-of-the-international-energy-agency/

[iv] An exception, as I have previously noted is work by Greenpeace.  Some previous scenario work by Shell was also close on wind and solar, but greatly overestimated the role of CCS and biofuels.

[v] The Underestimated Potential for Solar PV Energy to Mitigate Climate Change, Creutzig et. a. Nature Energy, Published 28/08/17

[vi] CCS still looks essential for decarbonisation in some cases, and given lead times for its development continued research and early deployment is still very much needed.  This is especially so for industrial applications.  Deployment in power generation looks likely to be more limited over the next decade or more, though some may still be needed when to move to very low emissions, and eventually to zero net emissions.  However the contribution of CCS to power generation now looks likely to be much less than that from solar PV.

Deploying CCS on fossil fuel plant is more of a priority than implementing negative emissions technologies

The potential for biomass with CCS and direct air capture of CO2 should not distract from deployment of CCS on fossil fuel plants over the next few decades.  Among other things, learning from CCS on fossil fuels will help make eventual deployment of CCS on biomass cheaper and more effective.

There appears to be increasing likelihood that atmospheric concentrations of greenhouse gases will grow to exceed levels consistent with the target specified in the recent UNFCCC Paris agreement of limiting temperature rises to “well below” two degrees.  Such an outcome would require CO2 to be removed from the atmosphere faster than natural sinks allow, in order to restore concentrations to safe levels.  Near zero net emissions in the latter part of this century will also be needed to stabilise concentrations.

Many models of future emissions pathways now show negative emissions technologies (technologies that result in a net decrease in CO2 in the atmosphere) needing to play a major role for in meeting climate goals. They have the potential to remove carbon dioxide from the atmosphere in the event of “overshoot” of target atmospheric concentrations, and to balance remaining emissions from sectors where abatement is difficult with a view to achieving net total emissions of close to zero.  But the application of such technologies should not be considered in isolation.

Bio Energy with CCS (BECCS)

Bio energy with CCS (BECCS ) is the most widely discussed approach to negative emissions.  BECCS is not a single technology but a combination of two major types of CO2 removal.  Bioenergy from burning biomass to generate electricity or heat emits a substantial amount of CO2  on combustion – around as much as a coal plant.  However much of this can be captured using CCS.  More carbon dioxide is reabsorbed over time by the regrowth of the plants, trees – or perhaps algae – that have been harvested to produce the bioenergy.  Together, the capture of the CO2 from the flue gas and the subsequent absorption of CO2 from the atmosphere by regrowth of biomass can lead to net removal of CO2 from the atmosphere, although this takes time.  (The net amount of CO2, that is emitted on a lifecycle basis from burning biomass without CCS depends on the type of biomass and is subject to considerable variation and uncertainty – a controversial topic that would need another post to review.)

However at an energy system level, where the CO2 is captured – biomass plant or fossil fuel plant – is less relevant than the total amount that’s captured.  Broadly speaking, if there is a biomass plant and fossil fuel plant both running unabated the same benefit can be achieved by capturing a tonne of CO2 from either.

Indeed there may be advantages to putting CCS on a conventional plant rather than biomass plant.  It may be technically more tractable.  Furthermore, CCS require a lot of energy to capture the CO2 and then to compress and pump it for permanent storage.  Biomass is likely to be supply constrained (again, this is an issue that requires a post in itself), so using biomass rather than fossil fuels to provide this energy may limit other applications.  Only when there are no fossil fuel plants from which to capture CO2 does biomass plant become unambiguously a priority for CCS.  This is clearly some way off.

Furthermore biomass with CCS for electricity generation may not be the best use of bioenergy.  Converting sunlight to bioenergy then turning that into electricity is a very inefficient process.  Typically only 1-2% of the sunlight falling on an area of cropland ends up as useful chemical energy in the form of biofuels.  There are various reasons for this, not least of which is that photosynthesis is a highly inefficient process.  Burning biomass to make electricity adds a further layer of inefficiency, with only perhaps a third or less of the energy in the biomass turned into electricity.  Sunlight therefore gets converted to electricity with an efficiency of perhaps 0.5%.  This compares with around 15- 20% for solar cells, implying that scarce land is often likely to be best used for solar PV.  (The calculation is closer if solar PV is used to create storable energy e.g. in the form of hydrogen).   For similar reasons the use of biofuels rather than electricity in transport is inefficient, in part because internal combustion engines are less efficient than electric motors.

Limited available biomass may be better used for those applications where it is the only available lower carbon energy source, notably in aviation and (likely) heavy trucks, or for other applications such as district heating with CCS, where the ability to store energy seasonally is especially valuable.

At the very least, detailed system modelling will be required to determine the optimal use of biomass.  Suggesting that BECCS should have a major role to play simply because in isolation it has negative emissions may lead to suboptimal choices.

Direct Air Capture (DAC)

Direct Air Capture (DAC), where carbon dioxide is chemically absorbed from the atmosphere and permanently sequestered, can also reduce the stock of CO2 in the atmosphere.  However the typical concentration of CO2 in a flue gas of a power plant or industrial plant is several percent, about a hundred times as great as the concentration of 0.04% (400 ppm) found in the atmosphere.  This makes the capture much easier.  Furthermore, millions of tonnes can be captured and piped from a single compact site using CCS, generating economies of scale on transport and storage.  In contrast DAC technology tends to be more diffuse.  These considerations imply that CCS from power plants and industrial facilities is always likely to be preferable to direct air capture until almost all the opportunities for CCS have been implemented, which again is a very long way off.

Uncertainties and optionality

There are many uncertainties around negative emissions technologies, including the availability of biomass, cost, and the feasibility of reducing emissions in other sectors.  For these reasons developing optionality remains valuable, and research to continue to develop these options, including early trial deployment, is needed, as others have argued[i].

One of the best ways of developing optionality is to deploy CCS at scale on fossil fuel plants.  This will reduce the costs and enable the development of improved technologies through learning on projects.  It will also help build infrastructure which can in turn benefit  BECCS.  This needs to run in parallel with ensuring that the lifecycle emissions from the bioenergy production chain are reduced and biodiversity is safeguarded.

Negative emissions technologies may well have a role to play in the latter part of the century.  But they seem likely to make more sense when the economy is already largely decarbonised.  In the meantime deployment of CCS, whether on industrial facilities or power plants, needs to be a much greater priority.

Adam Whitmore – 21st March 2016

[i] Investing in negative emissions, Guy Lomax,  Timothy M. Lenton,  Adepeju Adeosun and Mark Workman, Nature Climate Change 5, 498–500 (2015)  http://www.nature.com/nclimate/journal/v5/n6/full/nclimate2627.html?WT.ec_id=NCLIMATE-201506

 

 

CCS is making progress – but not much in power generation

There is now sufficient experience of CCS around the world to begin to see what makes early projects happen.  Most projects capture from natural gas processing or other industrial processes, with little progress in the power sector.

Many projections show CCS as a major future contributor to decarbonisation.  But, as described in my last post, energy technologies take a long time to reach scale, and CCS has to date developed less rapidly than many were hoping a few years ago.  However with around eighteen large-scale projects now either operational or under construction patterns have begun to emerge that indicate which factors make for a successful project [i].

Use of captured CO2 for Enhanced Oil Recovery (EOR) is common across projects of various types, being a feature of two thirds of projects.  When injected into oil reservoirs each tonne of CO2 can enable the production of (typically) two or three additional barrels of oil, making the CO2 a valuable commodity rather than a waste product.  While the carbon capture project is unlikely to be able to capture all of this value (much of it flowing to the owner of the oil field), the revenue can be substantial.  For example, the price paid for CO2 in some Canadian projects is understood to be $60/tonne or more.  This greatly enhances the economics of a project relative to incurring a cost for transport and storage, which in the absence of oil revenue is likely to be at least $20/tonne.

The most widespread application of CCS technology to date, with eight projects out of the eighteen and over 60% of annual volume captured, has been for natural gas processing, where CO2 needs to be removed to meet the specifications required by the pipeline network.  There is a wide range of projects, including onshore processing where the CO2 is used for EOR, such as at the Val Verde project in the USA, offshore processing where CO2 is injected into saline formations, for example the Sleipner and Snohvit projects in the Norwegian North Sea, and the Gorgon project under construction in Australia, where CO2 will be captured from a LNG liquefaction facility.

There are other projects where a relatively pure stream of CO2 is produced as part of an industrial process, avoiding much of the capture costs associated with dilute CO2 streams.  These include capture from electric arc furnaces at steel mills, such as at the ESI project in Abu Dhabi, and capture from steam methane reformers (SMRs), such as an Air Products plant that has just begun operating in Texas.  Other industrial projects include Shell’s Quest oil upgrader in Alberta and the Enid fertiliser plant in Oklahoma.  With substantial natural gas processing facilities, industrial facilities and onshore oil fields suitable for EOR, North America has been the main location for all types of CCS projects to date, around two thirds being in Canada or the USA.

However the contribution of CCS to decarbonising the power sector and other combustion remains minimal.  There are only two full-scale (greater than 100MW capacity) power projects under construction. The largest of these, the Kemper County project in Mississippi, has relatively high emissions (estimated to be greater than those of a CCGT per MWh) due to its use of lignite and a relatively low capture rate.  The other is the Boundary Dam project in Saskatchewan where construction is nearing completion and commissioning is due to start later this year.

CCS projects are dominated by natural gas processing and industry with relatively little capture from the power sector …

CCS projects chart

Source:  Global CCS Institute

Whichever of the CCS technologies a power project uses – pre-combustion, post-combustion or oxyfuel – a chemicals plant needs to be added to the power plant, and this is inevitably expensive.  The large additional capital and operating expenditures required for a capture system, combined with the loss of efficiency due to the energy required to run the capture process, including the electricity required to compress the CO2 ready for transport, add greatly to the cost of power.  According to a recent study sponsored by the UK government, power generation with CCS has a cost of around £161/MWh at present, about three times the cost of power from conventional fossil fuels [ii].  The study suggests that this could potentially be reduced to around £100/MWh by the early 2020s, although this may prove a somewhat optimistic estimate.  Meanwhile, the Kemper County plant is reportedly suffering cost over-runs.

The large additional cost of power from CCS means that it needs types and levels of enabling support similar to other early stage power generation technologies. The power sector projects that are under construction both have favourable financial arrangements.  The Boundary Dam project is being developed by the province-owned utility, Saskpower. This means that the additional costs of CCS can be covered through government-backed financing and through the ability to pass on costs to electricity users.  The Kemper County project is allowed to recover its costs from the local rate base from the start of construction, greatly improving the financial attractiveness of the project.  Both projects also benefit from sales of CO2 for EOR.

Financial support is likely to take the form of some combination of a premium price for the power, capital grants, loan guarantees and other source of low cost capital, and perhaps support for provision of common infrastructure, including pipelines and sinks.  A substantial per MW or per MWh contribution is needed, and the relatively large scale of CCS projects means that finance needs to come in large blocks, with large amounts of support for each project.  Building projects will be necessary to enable “learning by doing” to bring the cost down substantially, but learning times are long due to long design and construction periods.

So far putting the necessary support in place has proved daunting for most governments, and public opposition has also hampered progress in some jurisdictions.  Europe has made little progress, and in the USA the potential to reduce emissions much more cheaply by switching from gas to coal seems likely to lead to limited prospects for CCS power projects in the short to medium term.  However there is increasing interest in CCS in China, and it is possible that, as with so much else, development in China will prove crucial to the global picture over time.  The strength of interest in CCS may in turn depend on progress with developing shale gas in China.

Achieving scale sufficient to capture a large proportion of the world’s combustion emissions from the power sector or elsewhere will in any case be an enormous task.  CO2 is 27% carbon.  Fossil fuels are more typically 75-80% carbon [iii] by mass.  From this, a simple mass balance implies that the capture, transport and storage to dispose of the CO2 must handle about three times the mass of the production and transport of the fossil fuels burnt.

Many new CCS projects are likely to continue to be outside the power sector, especially where there is potential for EOR, and this will make important contributions, for example to knowledge of reservoir management and in some cases to the scale of pipeline networks.  It remains important that some power sector projects are undertaken at scale, as implementing widespread CCS on power plants, especially on gas, remains an option that will probably need to be exercised in the coming decades.  However realising power projects with CCS will continue to be a difficult and, very likely, slow process.

Adam Whitmore  3rd June 2013

Thanks to Dave Mirkin of 2CO for providing valuable input for this post.

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[i] See the 2012 Annual Report from the GCCSI and January update.

http://www.globalccsinstitute.com/publications/global-status-ccs-2012

http://cdn.globalccsinstitute.com/sites/default/files/publications/85741/global-status-ccs-january-2013-update.pdf I have added the Abu Dhabi ESI project to the total as I understand it has now progressed to the construction phase.  A similar project is understood to be planned in Saudi Arabia, but is excluded due to lack of firm information.

[iii] This is a typical number.  Natural gas has a carbon content about this level.  The carbon content of oil is higher, coal varies depending on quality.  The essential point that the waste disposal must handle much greater mass than the fuel supply remains unaffected.