The Parliament's environment (ENVI) committee yesterday (7 October) supported two separate reports that contain landmark amendments related to the financing and commercial development of CCS technology (EurActiv 08/10/08).
MEPs endorsed an amendment, tabled by Irish Christian Democrat MEP Avril Doyle, that recommends the free allocation of up to 500 million CO2 emissions allowances to select CCS demonstration plants. The allowances are normally reserved for new entrants to the EU Emissions Trading Scheme (EU ETS).
Equivalent to approximately €10 billion at current carbon market prices, this allowance-based financing scheme was bolstered further when MEPs endorsed a separate amendment that would set a CO2 output limit on power generating facilities.
The amendment, tabled by UK Liberal MEP Chris Davies in his report on the Commission's proposal for a legal framework on the geological storage of CO2 in the EU, is meant to oblige power generators to invest in CCS technology to meet the CO2 limit requirements, notably for their coal-fired power stations.
Coal-fired dragon
For China, EU efforts to develop commercially viable technologies that can neutralise the CO2 output of coal-fired power stations are of great interest.
China accounted for 40% of the increase in global primary energy demand in 2007, and most of that demand was met with coal, according to BP's 2008 Statistical Review of world energy, released last week in Brussels.
Most analysts agree that world's most populous country's reliance on coal is unlikely to decrease in the foreseeable future. Beijing has few alternatives for meeting the challenge of constantly rising domestic energy demand that results from continued high levels of annual GDP growth, says Fabian Zuleeg, senior policy analyst at the European Policy Centre in Brussels.
But the continued burning of coal is having a tremendous impact on the climate and on the environment, both within China and globally. Decreased run-off from Himalayan glaciers, coupled with higher water demand, has led to annual declines in water levels in key rivers like the Yangtze, which acts as the lifeblood of millions of Chinese.
Chinese leaders are taking the problem seriously and are "very willing" to reduce the CO2 impact of their economy, Doyle told journalists in Brussels yesterday. Beijing has also been pressing EU leaders to provide clearer answers on when and how the 10-12 CCS demonstration plants will be completed, she said.
Crunch time
Whether the Council will endorse the Doyle-Davies amendments on CCS as part of an eventual deal on the climate package before the end of the year remains to be seen. But EU countries should either back the Parliament on the issue or propose a realistic alternative, says Davies, who yesterday challenged the Council to "match fine words with some good deeds".
