Why has carbon capture and storage not taken off yet?

There may be more of a case for CCS than environmentalists have given credence to, writes Michael McDonald of OilPrice.com. 

|
Matthew Brown/AP/File
a pair of coal trains idle on the tracks near Dry Fork Station, a coal-fired power plant being built by the Basin Electric Power Cooperative near Gillette, Wyo, April 29, 2010. A laboratory where teams of researchers will study how to keep carbon dioxide emitted by coal-fired power plants from entering the atmosphere will be built at a Basin Electric power plant near Gillette, a spokesman for Gov. Matt Mead said Wednesday, Oct. 7, 2015.

For all of the talk about green energy one fact still remains clear; fossil fuels are going to continue to be used in enormous quantities for decades to come. From China and India to the U.S. and Canada, the world is flooded with growing markets looking for new sources of fossil fuels and developed markets coming up with new ways to extract those fossil fuels. India, for instance, is on track to double its use of coal as a main source of energy over the next 20 years.

It is certainly true that solar power in particular is growing rapidly in importance but that has very little to do with the fact that hundreds of millions of cars and homes still rely on oil and natural gas for power and heat. Retrofitting an asset base that large would require trillions in investments.

Given these realities, carbon capture and storage (CCS) is an intriguing proposition and one that pragmatic environmentalists ought to give more credence to. Yet, CCS has not really gotten off the launch pad at this stage despite the fact that a new report from an industry group highlights the necessity of the technology in helping to mitigate carbon emissions across the world economy. There are a variety of criticisms against the technology, yet it may be the best of a bad set of options.

According to the Zero Emissions Platform industry group, "Without CCS, the cost of decarbonising the power sector could be 2 to 4 trillion euros ($2.3-$4.5 trillion) higher and some energy-intensive industries would not be able to decarbonise at all." The problem is that while CCS is probably good for the environment, it does not make economic sense on its own in many cases and environmental groups have failed to rally behind it in any meaningful way.

The business case for CCS is built on the idea that taking carbon out of fossil fuel energy production and injecting it back into the ground then helps to enhance recovery rates on oil and gas fields. This idea would be great as a recovery mechanism for fossil fuel fields if it were cost effective. But it’s not. Utilities in general have very little interest in CCS as the technology is expensive to retrofit on existing plants. Standalone CCS facilities can cost up to a billion dollars, and they only remain economically useful as long as an oil or gas field has resources remaining.

There are many big firms backing CCS, especially large oil companies, but none of them are interested in spending investor’s money on the plants without a rational economic reason to do so. With oil prices slumping over the last year and profit margins tighter than ever, any realistic prospect of companies choosing to install CCS tech in facilities for business reasons have vanished. At this stage, across most of the world, carbon has no positive value.

 

One could have argued that CCS made sense in some regions before the oil price slump, but at this point companies are in cash lockdown and are in no mood to engage in substantial discretionary spending. Apache (APA) and Encana (ECA) have used CCS technology previously and American Electric Power (AEP) has a CCS project in place at a plant in West Virginia, but these projects are insignificant in the larger scheme of things.

That means that for CCS to really take off, world governments would have to decide that they want to put a price on carbon. Political realities make that unlikely for now in most major regions except Europe. Even in the EU though, the block has failed to set an effective carbon price, which has created a lack of major impetus for CCS projects. This has seriously held back the technology. At the end of the day, while CCS is a potentially very useful and important technology from a pragmatic standpoint, until the world gets serious about charging companies that emit carbon or a viable business purpose is developed to use enormous amounts of carbon, CCS initiatives are unlikely to go far.

Source: http://oilprice.com 

Original article: http://oilprice.com/Energy/Energy-General/Why-Has-Carbon-Capture-And-Storage-Not-Taken-Off-Yet.html 

You've read  of  free articles. Subscribe to continue.
Real news can be honest, hopeful, credible, constructive.
What is the Monitor difference? Tackling the tough headlines – with humanity. Listening to sources – with respect. Seeing the story that others are missing by reporting what so often gets overlooked: the values that connect us. That’s Monitor reporting – news that changes how you see the world.

Dear Reader,

About a year ago, I happened upon this statement about the Monitor in the Harvard Business Review – under the charming heading of “do things that don’t interest you”:

“Many things that end up” being meaningful, writes social scientist Joseph Grenny, “have come from conference workshops, articles, or online videos that began as a chore and ended with an insight. My work in Kenya, for example, was heavily influenced by a Christian Science Monitor article I had forced myself to read 10 years earlier. Sometimes, we call things ‘boring’ simply because they lie outside the box we are currently in.”

If you were to come up with a punchline to a joke about the Monitor, that would probably be it. We’re seen as being global, fair, insightful, and perhaps a bit too earnest. We’re the bran muffin of journalism.

But you know what? We change lives. And I’m going to argue that we change lives precisely because we force open that too-small box that most human beings think they live in.

The Monitor is a peculiar little publication that’s hard for the world to figure out. We’re run by a church, but we’re not only for church members and we’re not about converting people. We’re known as being fair even as the world becomes as polarized as at any time since the newspaper’s founding in 1908.

We have a mission beyond circulation, we want to bridge divides. We’re about kicking down the door of thought everywhere and saying, “You are bigger and more capable than you realize. And we can prove it.”

If you’re looking for bran muffin journalism, you can subscribe to the Monitor for $15. You’ll get the Monitor Weekly magazine, the Monitor Daily email, and unlimited access to CSMonitor.com.

QR Code to Why has carbon capture and storage not taken off yet?
Read this article in
https://www.csmonitor.com/Environment/Energy-Voices/2015/1105/Why-has-carbon-capture-and-storage-not-taken-off-yet
QR Code to Subscription page
Start your subscription today
https://www.csmonitor.com/subscribe