CCS - more than just climate mitigation

作者：Alex Zapantis （General Manager Commercial at Global CCS Institute）

原文链接：https://www.linkedin.com/pulse/ccs-more-than-just-climate-mitigation-alex-zapantis/

From myth to mandatory

Earlier this week I gave a key note speech at the China Australia Geological Storage of CO2 Symposium (CAGS) in Perth, where I was asked to speak on the opportunities and risks for carbon capture and storage (CCS).

This is a topic I have been thinking about, in various capacities since 2006. I must say, coming from a uranium and nuclear background, I was initially skeptical of the utility of CCS. How could capturing carbon dioxide from power stations and other sources, then storing it in the ground possibly work?

Surely the answer to climate change was not this but a mixture of energy efficiency, fourth generation nuclear and renewable technologies? So, I did some research. I took the time to read everything I could on the topic and to speak to people who believed in this apparent magical technology. I reckon it took about two weeks before I was educated, and completely converted.

I realised that the fossil fuel industry was not dying, quite the opposite, fossil fuel demand – which extends far beyond just power generation – was growing and CCS was not only technically feasible, it was also indispensable in any future with a stable climate.

This was my first lesson in the risks and opportunities for CCS. The opportunity to reduce emissions by 90 per cent or more from large point sources of CO2 is challenged by the risk that erroneous assumptions, preconceptions and bias prevents CCS from receiving the investment required for it to advance.

The status of CCS

Fast forward to 2018. Twelve years have passed since my introduction to CCS, so where are we today?

The answer is; we are in a world where CCS is real, it is happening and, as confirmed by International climate change experts such as the International Energy Agency (IEA), it is vital to meeting global climate targets.

Right now, across the globe there are 17 large scale CCS facilities in operation, and another five under construction. Each of these facilities is capturing and injecting at least 400,000 tonnes of CO2 per year – some are injecting more than a million tonnes per year.

In addition to these large-scale facilities, there are more than 25 operating small scale and pilot projects according to Global CCS Institute’s database. In 2010, there were 7 operating large-scale facilities. By 2020, we expect there will be 22. So, progress has absolutely been made.

However, we are yet to see the rapid increase in investment required for CCS to play its required role in meeting ambitious climate targets. Sadly, CCS is in good company here – the IEA recently reported that 34 out of 38 climate mitigation technologies were “not on track” to deliver on the well-below 2 degree scenario.

CCS is vital, so why the delays?

All of this begs the question; why is money not flowing to CCS? The nascent state of the global CCS industry creates risks for potential investors. The well-established and familiar business models, structures and practices that exist in mature industries and play a significant role in reducing investment risk have generally not yet developed for CCS.

In most cases, the market does not provide sufficient reward for CCS to achieve required rates of return on investment – and the required rate of return is sometimes elevated due to the perceived risk associated with the investment making financing difficult. 

Significant innovations in technology, in business models and in industrial efficiency are generally driven by the competitive powers of the market. Providers of goods or services compete to reduce costs, to improve the utility of their products and hence, to win market share.

Innovations can only be protected from competitors for a finite time; knowledge leakage inevitably occurs spreading developments throughout the entire industry. As a market grows, economies of scale and scope and learning-by-doing also deliver cost reductions, which increases demand for the product until market saturation occurs. The net result is the familiar pattern of reducing technology cost over time in real terms.

This is certainly the pattern that has been observed with renewable energy technologies since the turn of this century, driven by very strong and sustained policy support.

These cost-reducing processes are only just beginning with respect to the global CCS industry. The market has not yet reached the point where competitive forces are driving sufficiently large investments by the private sector in CCS where economies of scale and learning-by-doing are rapidly reducing cost.

So, what can be done?

I have often said that the deployment of CCS is a function of climate mitigation policy stringency. Put simply, if governments are serious about reducing emissions, the policies they implement will naturally lead to the deployment of CCS alongside all the other low emission and energy efficiency technologies required to meet climate targets. Based on the recent IEA report I just quoted, it appears that other policy objectives enjoy a higher priority.

This should not be surprising. Limiting global warming to well-below 2 degrees is not the only outcome that we, as a species, are seeking. We also want to grow the global economy.  We want to extend the same opportunities for education, healthcare, and amenity that we in developed economies take for granted to the hundreds of millions of people for whom such things are currently unattainable. The reality is that there is competition between these goals for profile, for political support, for scarce resources.

To succeed in building a sustainable global society, we must find solutions that serve multiple goals over the long term. Solutions that meet the challenges of today whilst keeping us on track to achieve the goals of tomorrow.  We must also enthusiastically accept that there will be many solutions to the same problem, and those solutions will change with place and time. There truly are no silver bullets.

CCS is no silver bullet, but it is a solution

CCS is not the only solution, but it is a solution that helps solve many problems. And there-in lies a range of opportunities. I believe that to win the support necessary for CCS to thrive, we must speak in terms of its total value to society – we must describe how CCS contributes to the achievement of objectives that extend well beyond mitigating climate change and appeal to a much broader constituency. Here are some examples using the United Nations Sustainability Goals as a framework:

CCS delivers industrial scale dispatchable, low emissions electricity demanded by modern economies, supporting the achievement of the United Nations’ Affordable and Clean Energy Sustainable Development Goal. Now at this point some will immediately start citing levelized cost of electricity production figures as proof that wind and solar PV provide the most affordable clean energy. This is simply incorrect. In most places, the lowest cost low emissions electricity grid will comprise a portfolio of low emission energy sources including gas or coal with CCS.

CCS coupled with methane reformation or coal gasification provides the lowest cost zero emissions hydrogen which can be used in stationary energy or to decarbonise the transport sector, particularly heavy transport where hydrogen fuel cells can provide the range that battery energy storage cannot.

Clean hydrogen can also be used to decarbonize industrial and residential heat. Hydrogen can be introduced into the domestic natural gas reticulation system at concentrations below approximately 10-15% without any modifications to the reticulation system or end-use domestic appliances, delivering equivalent emission reductions.

Decarbonising industry with CCS

Beyond stationary energy and transport, CCS can be applied to new industrial infrastructure or can be retrofit to existing infrastructure such as steel, cement and fertiliser production to make it sustainable and consistent with a low emissions future. Industrial precincts with access to suitable storage resources present a fantastic opportunity to build the new low emissions industries of the future by allowing multiple sources access to common CO2 compression, transport and injection infrastructure significantly reducing the unit cost of carbon dioxide storage.

What I know now that I didn’t in 2006 is that CCS delivers a broad range of benefits to society alongside emission reduction, creating an opportunity to broaden its support-base and position it more positively in the public and political discourse.

This will provide governments with the license to implement new policies that support CCS, provide financiers with the incentive to better understand CCS, and provide investors with the confidence to invest in CCS.

Recognising the broader benefits of CCS

To realise the CCS opportunity, advocates for the technology need to broaden their messaging. We have been emphasising the necessity of CCS to meet climate targets for a decade. I think it’s time to put more effort into drawing attention to the broader benefits of CCS.

There is no shortage of opportunities for CCS. I’ve mentioned a few but not even touched so many; including the recent positive government and policy initiatives like the 45Q tax credits in the USA, or the CCUS Council in the UK, or the full CCS chain studies in Norway or the Hydrogen Energy Supply Chain Project in Australia.

We are in an opportunity rich environment. As community expectations related to climate mitigation slowly rise, and governments respond with more stringent climate policy, those opportunities will become ever more present.

Overcoming the barriers

The most significant barrier to realising those opportunities, the most significant risk, in my view is the status quo. If we don’t change anything, nothing will change and CCS will remain just an opportunity – a niche player. The world will adopt a more expensive, less effective climate mitigation strategy delivering poorer economic and environmental outcomes and we will look back and wonder what could have been.

The fundamental drivers of demand for CCS are there; policy is generally moving in the right direction which is mobilising more investment and the project pipeline is beginning to grow again.

And that is why I remain converted. In fact, I am enormously optimistic about the future prospects of CCS. There is no doubt it is an essential climate mitigation technology, and its time has come.