Suggested talking notesThe Institute is proud to support the ENGO CCS Network in releasing this White Paper on CCS It is important that the ENGO community is allowed to expresses its views on important issues such as CCS’ role in addressing climate changenote that the Institute had no editorial control over the report the Institute’s role in this effort was to simply support the ENGO Network to independently express its views in a timely way and to effectively participate in this year’s UNFCCC dialogue It is also important to flag upfront that the ENGO Network’s support for CCS is not the perpetuation of fossil-fuel use, but as a core mitigation technology capable of achieving deep emission reductions and lowering the overall costs of mitigation while the issue of sustained fossil-fuel use is not mutually exclusive to the objective of addressing climate change, it does often involve political judgements exogenous to climate change such as preservation of energy and national security, as well as of enhancing economic prosperity, development and poverty alleviation There are many key conclusions and insights contained in the report, but for me the most important are:The ENGO Network, after carefully reviewing the latest science and the prevailing fleet (and investment pipeline) of CCS projects conclude:strongly supports CCS as part of a broad portfolio approach to mitigationexpresses great confidence for the injected CO2 to remain permanently and safely stored (and notes that CCS has an excellent safety track record to date)that governments have the most important role to play in advancing CCS – especially in regards to providing the necessary market and regulatory conditions as well as supporting large scale pre-commercial demonstrations (to bring down the price premium); and that the single most significant barrier standing in the way of CCS deployment is not technical but the absence of comprehensive climate policies that place a market value on avoided emissions. More generally, this report:Examines the science and the status of CCS projects (in Australia, Canada, EU, Germany, Norway, UK, USA, and LDCs (China, SAF, India)) – and draws some very important consolidated conclusions …The Paper recognises that CCS needs to be supported as part of a “balanced and hedged approach” to managing emissions from fossil-fuelled (including coal and gas) industries – especially should a shift away from fossil fuels take longer than planned or anticipatedAs such, CCS offers a pathway to curtail emissions from power and industrial plants – both now (given the vast install base) and into the futureThe ENGO community clearly recognises that no single mitigation option can deliver the scale of abatement required – and that a portfolio approach to supporting mitigation technologies, such as CCS, not only increases the probability of delivering economy-wide emission reductions (i.e. assisting country compliance with obligations adopted under the UNFCCC) but also likely to lower the costs of mitigationThe Paper also acknowledgesthat for some industrial applications, there is no other option – other than CCS – to drive large emission reductions as CO2 emissions are integral to the industrial processes, as well as the potential to deliver net reductions in CO2 from the atmosphere when CCS is coupled with sustainable bio-energy.
The Global Status of CCS is our flagship publication2012 is the fourth year that the Global CCS Institute has reported globally on CCS.This report:identifies the status of CCS, including a comprehensive overview of CCS projects;the developments that have occurred in the past year; andthe challenges that must be addressed.
Least cost abatement: CCS = 14% to 2050 (17% in 2050)$3 trillion extra capital if no CCS.CCS = 7 Gt/42Gt reduction16 x Australia's current CO2 emissions
Around the world, the eight large-scale CCS projects in operation can store more than 23 million tonnes of CO2 per year. This is not an insignificant figure – itis more abatement than the total country-level reductions in Australia, through all of the climate policies to date.Then there are a further eight projects currently under construction and in 2015 these projects will increase the total to over 36 million tonnes of stored CO2 a year. This is approximately 70 per cent of the IEA’s target for mitigation activities for CCS by 2015.But by 2020, the IEA models 130 projects storing more than 258 tonnes of CO2 per year are required.Clearly we will be well short of this.The ramp up to achieve the needed mitigation by CCS of 7Gt of CO2 in the year 2050 is enormous. This is over 350 times what is currently being stored.Note: The total operational storage capacity is now officially over 23 Mtpa as the final 3.4 Mtpa capacity from Century Plant in Texas has been confirmed as in operation.
The number of large-scale integrated projects has had a net increase of only one since 2011, making 75. Since 2010 one of the key projects developments that we have seen is the steady increase of projects at the Execute stage as you can see in this Figure. What is somewhat alarming is that we are not seeing these steady improvements in the latter stages of development planning being the Define and Evaluate stages. Amongst the changes within the set of projects from 2011 to 2012 is that eight previously-identified projects were cancelled, put on hold or restructured for diverse reasons, ranging from insufficient revenues for carbon sales to inadequate storage regulations. These were offset by nine newly identified projects, and of these, five are in China. China is a fast emerging force in CCS.
The UK Government is taking a leading role with the first comprehensive policy to drive CCS deployment beyond demonstration projects. Support for CCS is enabled through actions to reform electricity market arrangements and the implementation of the CCS Roadmap. This policy package should be closely watched for its impact and the potential for application elsewhere. In our survey of CCS projects CCS projects in Europe strongly indicated that government policy is essential for projects to be in a position to make a positive business case. It is positive then that the European Commission's NER300 funding program has continued to move forward. In July the Commission released a Working Document that sets out the ‘current order of selection’ and a reserve list for the 10 remaining projects. To support effective and efficient operations across all CCS activities international standards for CCS are being developed. Canada to be acknowledged. However, these standards are likely to take several years to develop. In the meantime it will be important to avoid overly conservative requirements being imposed on CCS projects.
Clearly shown in this Figure is that CCS is a cost-competitive technology compared to other CO2 mitigation options. Difficulties arise as CCS is often not treated equivalently to other low-carbon technologies in policy settings and government support. Like many emerging technologies, CCS faces barriers that discourage new projects from emerging and prevent planned projects moving forward. Funding for CCS demonstration projects, while still considerable, is increasingly vulnerable. It has also been realised that the level of funding support still available will service fewer projects than initially anticipated. The relatively higher-cost CCS projects (for example in the power, steel and cement sectors) require strong government support continuing into the operational phase. In order to achieve emission reductions in the most efficient and effective way, governments should ensure that CCS is not disadvantaged.
Climate change legislation must not be delayed. Timely and stable policy support is required to deal with the barriers to implementation of CCS. This will drive industry confidence, encouraging more innovation, and ultimately reducing capital and operating costs. To achieve emission reductions in the most efficient and effective way governments should ensure that CCS is not disadvantaged. They must review their policies to ensure that CCS can play a full part in the portfolio of low-carbon technologies. Funding for CCS demonstration projects by governments and industry should be accelerated to develop the technology and bring down costs through innovation. Sharing expertise and learning from CCS projects around the world must be encouraged to ensure that progress is made as quickly as possible. Creating a business case and managing the technology is a complex and difficult process, so capturing and using lessons from other projects is vital. Importantly, this knowledge must be shared with developing countries where 70 per cent of CCS deployment must occur by 2050.
International Progress on CCS
INTERNATIONAL PROGRESS ON CCSBRAD PAGECMP8 COP18, Doha4 December 2012
LAUNCH OF ENGO WHITE PAPER ON CCS Released 4 December 2012. ENGO Network is an international group of leading environmental organisations. ENGO independently examines the science of CCS. Network endorses CCS as a vital technology. CCS is already a reality. 2
THE GLOBAL STATUS OF CCS: 2012Key Institute publication Released 10 October 2012. Comprehensive coverage on the state of CCS projects and technologies. Progress outlined since 2011. Challenges and recommendations for moving forward. 3
KEYMESSAGE ACTION IS NEEDED NOW TO ENSURE CCS CAN [1 [ PLAY A VITAL ROLE IN TACKLING CLIMATE CHANGE Energy-related CO2 emission reductions by technology SOURCE: IEA NOTE: Percentages represent share of cumulative emissions reductions to 2050. Percentages in brackets represent share of emissions reductions in the year 2050. 4
KEYMESSAGE CCS IS ALREADY CONTRIBUTING, [2 [ BUT PROGRESS MUST BE ACCELERATED Volume of CO2 potentially stored by large-scale integrated projects 5
KEYMESSAGE STEADY PROGRESS BUT [3 IMPORTANT DEVELOPMENTS [ Large-scale integrated projects by asset lifecycle and year 6
KEYMESSAGE ENCOURAGING POLICY SUPPORT [4 BUT MORE REQUIRED [ CCS in the CDM – positive development. UK addressing Capex AND Opex. European Commission NER300 program. International standards for CCS under development. 7
KEYMESSAGE BARRIERS MUST BE OVERCOME [5 TO REALISE THE BENEFITS OF CCS [ Costs of CO2 avoided 8
KEYMESSAGE BARRIERS MUST BE OVERCOME [5 TO REALISE THE BENEFITS OF CCS [ Storage site selection and characterisation remains a lengthy and costly process. Public understanding of CCS remains low. Need to bring down the costs of CO2 capture through technology developments and demonstration. 9
RECOMMENDATIONS FOR DECISION MAKERS Climate change legislation must not be delayed. In order to achieve emission reductions in the most efficient and effective way CCS must not be disadvantaged. Funding for CCS demonstration projects should be accelerated. Expertise and learning must be shared. 10