Introductory presentation to the UK CCS dialogue, September 2009

1. UK CCS Dialogue
A structured cross-sectoral stakeholder dialogue to accelerate the
commercialisation of CCS in the UK and beyond
Introductory presentation
Chris Littlecott, Green Alliance
London, 10th September 2009

2. About Green Alliance
Independent charity: our purpose is to make
the environment a priority in British politics.
Hybrid thinktank-NGO: policy thinking
combined with political engagement, and
strong relationships with business and the
wider third sector.
Very active on CCS in both UK and EU:
supportive of public financing and the
identification of a policy framework that can
deliver for all stakeholders.
Believe that there are shared interests that
make this possible – this dialogue will see if
that is true.

3. About this presentation
Three main topics:
1. Why are we positive about the UK’s chances of delivering CCS?
2. A simple framework to guide thinking about different
stakeholder interests
3. Some key questions to help shape the dialogue
These are personal thoughts based on our experience.

4. Why might the UK be best placed to
deliver CCS in the EU?
“the UK is the EU member state best placed to implement a coherent
package of financing and regulation to drive CCS commercialisation. Such
action in the UK could catalyse progress in other EU member states and
have international influence ahead of the Copenhagen UN negotiations.”
Why are we so positive, given slow progress over recent years?
The Advisory Committee on Carbon Abatement Technologies says the creation
of a UK CCS industry is possible because we have:
“world leading experts in the key areas, an established engineering and
scientific base, a selection of available and known storage sites, an
industrial and commercial base that wants this to happen and an urgent
domestic need for investment in CCS.”
True, but not enough…

5. Three more ‘political’ reasons
1. Politics and Diplomacy – both major political parties positive about CCS
and committed to supporting it, while UK civil service extremely active
internationally in support of CCS.
2. Positive NGO engagement – highly successful climate campaign against
new unabated coal (and increasingly also existing plant), but UK NGOs
have been willing to engage on CCS in a way that hasn’t yet happened
elsewhere in the EU.
3. The debate about public acceptability is still yet to happen – faster
moving projects in Germany and Netherlands are now frustrated by
public opposition to CO2 transport and storage. There is time to shape
the UK public acceptability debate before projects proceed.

6. And three related opportunities
1. Can stakeholders help construct a cross-party consensus on CCS that can
secure a stable policy framework going forward?
2. Can the desire for action against carbon emissions be channelled into
support for CCS – from the climate movement and the general public?
3. Can we jointly ensure that the public acceptability debate occurs
positively, when at last it does arrive?
All of these are connected.
The closer we get to a shared view among all stakeholders, the easier it
will be to answer ‘yes’ to each one.

7. Unlocking a shared understanding:
this UK CCS dialogue
At present, the key UK stakeholders from the power sector, CCS industry,
institutional investors, regulators, and environmental groups lack a shared
understanding of a way forward for CCS policy. This is reflected in
ongoing campaigns against new coal power stations, creating additional
investment risks. Unless addressed now, public acceptability concerns
about CCS could stymie even an improved policy framework.
As a response to this situation, Green Alliance and the Carbon Capture and
Storage Association have decided to convene a structured stakeholder
dialogue. Our aims are to:
1. improve cross-sectoral understanding, and
2. enable stakeholders to identify the core measures required in a stable
policy framework that can accelerate the commercialisation of CCS by
driving CCS investment and the reduction of carbon emissions.

8. A framework for dialogue:
‘Confidence’
‘Confidence’ has been a recurring theme in the conversations we have
had with stakeholders over the last year:
• Is there a business case for new power stations?
• Can equipment providers scale up production?
• Will emissions actually be reduced?
• Does the power sector need to be decarbonised by 2030?
Some concerns are about a lack of confidence in specific CCS projects
(their delivery / perceived climate benefits), while others are about the
broader policy framework (will it lead to CCS deployment / the
decarbonisation of the power sector?)

9. Two key variables
We can group most stakeholder concerns into two broad categories:
• ‘Investor Confidence’
• ‘Climate Confidence’
Both are concerned with the outcomes from any UK policy framework
for CCS, and incorporate issues such as the level of regulatory certainty,
the provision of financial support, and the resulting carbon emissions
from any projects permitted going forward.
They are also important motivations for policy makers and regulators
relevant to achieving their desired policy outcomes in a context of tight
public budgets.

10. A framework to guide discussion
Scenarios ‘Climate Confidence’
Confidence’
Low High
Low ? ?
‘Investor
Confidence’
Confidence’
High ? ?

11. Low I + Low C = Shared Frustration
Potential Outcome:
• Few CCS projects come forward. Perhaps only the one in the UK
competition – but will it get built?
• Unabated gas plant construction continues or intensifies.
• No industry scale up or infrastructure development.
• Climate campaigners stay active against new and old coal, increasingly
also focussing on gas.
• No strategy to decarbonise power sector.
= CCS sidelined

12. Low I + High C = Passive Opposition
Potential Outcome:
• Few CCS projects come forward, only if they can meet strict climate
criteria. Potentially different approach than current UK competition.
• Unabated gas plant construction continues, but capture-readiness
requirements raise doubts.
• No industry scale up or infrastructure development.
• This outcome appears to be a domestic climate policy victory – but can it
have international influence?
• If there is a strategy for decarbonising the power sector, climate
campaigners could be less active on CCS, but may need to move on to
tackling emissions from gas plant if not.
= CCS difficult

13. High I + Low C = Active Opposition
Potential Outcome:
• Range of CCS projects come forward, including plants with substantially
unabated capacity.
• No clear climate benefits from projects and lack of clarity on power sector
decarbonisation.
• Means active campaigning against high-emitting sources, including direct
action and legal delays against CCS projects and pipelines, and public
acceptability concerns highly visible (Daily Mail campaign?).
• Industry scale up not likely, infrastructure development very difficult.
= CCS as controversial

14. High I + High C =
Catalytic Cooperation
Potential Outcome:
• Range of CCS projects come forward for coal, gas, and potentially
industrial / refinery projects, demonstrating clear emissions reductions
and as part of a wider power sector decarbonisation strategy.
• Rapid industry scale up and infrastructure development possible.
• Some limited opposition to CCS remains, but NGOs active in working
with industry to address safety and environmental concerns, and engage
positively in public acceptability debates.
• UK seen as leader within EU and internationally, and stakeholder
relationships recognised as important factor.
= CCS delivering

15. Questions for discussion #1
1. Does this characterisation of the current CCS context resonate with your
own experience?
2. Can we all agree that we should be aiming for a policy framework that
provides both high investor confidence and high climate confidence?
3. Would any of the other scenario outcomes still enable you to secure your
own objectives?

16. Questions for discussion #2
The Dialogue will seek to identify packages of policy options that can give
the desired confidence for all stakeholders.
But before we can identify policy options, we need shared criteria against
which we can jointly assess whether they work for mutual benefit:
policy?
What are your personal top 5 criteria for a successful UK CCS policy?
These could be related to the delivery of a specific project, your
organisation, the outcomes for UK PLC as a whole, the impact on carbon
emissions, or the nature of public engagement etc.
The more specific, concise, strategic etc. the better
e.g. “Any projects built with public funding must be of relevance for
India and China and share knowledge internationally” or “Projects should
receive capital grants as well as ongoing support”.

17. Many thanks
Chris Littlecott
Senior Policy Adviser
Green Alliance
36 Buckingham Palace Road
London
SW1W 0RE
Tel: +44 (0) 207 630 4516
Mob: +44 (0) 7734 910 180
clittlecott@green-alliance.org.uk
skype: chrislittlecott
http://www.linkedin.com/in/chrislittlecott