With greater investment in carbon capture and storage (CCS) projects and the need for the EU to rapidly decrease its carbon emissions, optimism in the schemes is growing, writes Guloren Turan.
Guloren Turan is general manager for advocacy and communications at the Global CCS Institute, an international think tank whose mission is to accelerate the deployment of carbon capture and storage (CCS) technology.
In order to avoid the catastrophic effects of climate change, we need to cut global emissions by half over the next decade and reach net-zero emissions by mid-century; that’s according to the Intergovernmental Panel on Climate Change and the ‘well below 2 degree’ scenario ratified in the Paris Agreement.
The consequences of climate change are tied to the cumulative greenhouse gases released in the atmosphere, meaning every year we delay critical action towards achieving net-zero emissions, the severity of our problem will continue to grow – and fast.
Achieving net-zero targets, by definition, requires emissions that have not reduced, to be balanced by their removal from the atmosphere.
Governments serious about tackling climate change have already begun utilising an innovative technology that does exactly that – that technology is called carbon capture and storage (CCS).
From Norway to the United States to Japan, CCS has become the best kept secret in the battle against climate change.
Not only does the technology reduce emissions from high energy sectors – like oil and gas, power plants, and hydrogen production – it does so by extracting CO2 from the atmosphere and storing it safely underground.
CCS has already been retrofitted to steel, power, hydrogen and other industrial facilities. In Europe alone, storage capacity is estimated to around 300 Gt which is more than the 220 Gt of CO2 that needs to be captured and stored globally between now and 2070, according to the IEA.
However, scaling up these systems and the number of facilities from 20-odd operating today to 2000 globally by 2050 will require significant deployment of infrastructure, human and financial capital.
So, what’s needed to accelerate the deployment of CCS and ensure it can contribute as required to achieve the net-zero target?
Throughout the next 10 years, the policy actions implemented, as well as investments in infrastructure and innovation, will determine if net-zero will be possible in our lifetimes.
To achieve this, supportive government action in this decade will be crucial. Three high level priorities needed to accelerate the progress of CCS over the next decade are:
- Create financial conditions for investment either through incentives (e.g. contract for difference, grants, tax credits, green bonds) or placing a value on emission reduction (e.g. mandates, emissions standards, cap and trade).
- Coordinate and underwrite CO2 transportation and storage infrastructure, most importantly CO2 pipelines, industrial hubs and clusters, and storage sites.
- Clarify key outstanding regulatory and policy issues, long-term liability resolution, and the cross-border transportation of CO2 for storage.
Fortunately, Europe has made strong progress in addressing these three policy priorities in the last year.
In addition to the rising EU emissions trading scheme carbon price, the European Commission launched the first call of the €10 billion Innovation Fund in July, which has since received 311 applications, including 14 from CCS projects.
In the Netherlands, the SDE++ subsidy scheme will incentivise the scale up of industrial CCS facilities by paying for the difference between the cost of capture, transport, storage and the EU emissions trading scheme carbon price for a period of 15 years with the first call expected in November.
These support mechanisms will underpin the revenue streams for CCS projects and help make the business case for investment.
Meanwhile, the Norwegian Government announced in September that it is ready to finance almost two thirds (16.8 billion crowns) of the Longship CCS project.
Once launched, Longship will capture and store emissions initially from waste-to-energy and cement plants in Norway, and European industry in the later stages.
A few weeks after Norway’s announcement, the Porthos Project in the Port of Rotterdam was awarded €102 million in funding from Connecting Europe Facility.
Enabled through significant government support and investment, both Longship and Porthos are scaled up to provide key transport and storage infrastructure services for a number of emitters located across Europe.
Across the channel, the UK Government announced a 10-point net-zero transition plan in early November, which includes CCS as one of its key pillars.
The announcement also included £1 billion funding for CCS infrastructure, with the goal of developing four hub and clusters and storing 10 million tonnes of CO2 per annum by 2030 – the first quantitative ambition of CO2 storage anywhere in the world.
An important regulatory milestone was reached in 2019 by an agreement on the so-called London Protocol to allow an interim solution to enable cross border transportation of CO2.
Despite this, the official ratification of the solution is outstanding and remains unresolved.
Further, the EU emissions trading scheme does not formally account for the transport of CO2 by ships; however, it is understood that correspondence between the EU Directorate-General for Climate Action and the Norwegian Ministry has taken place in the last few months to enable transport of CO2 by ships or trucks with specific conditions, thus lifting another regulatory roadblock.
As the European leaders are getting ready to agree in December the crucial 2030 target on the way to achieving net-zero by mid-century, it seems the stars for CCS are finally starting to align in Europe.
* Guloren Turan contributed this op-ed ahead of an online event to launch Global CCS Institute’s new report in December.