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Hard times for carbon capture and storage

CO2 emissions are growing

Global CO2 emissions continue to grow (34 billion tonnes in 2011), despite all reduction efforts. This trend is expected to continue, with more than 1000 new coal-fired power plants planned worldwide. Although coal releases 60% more CO2 than natural gas, the low prices of coal and of carbon emission allowances make burning coal for electricity generation more profitable than using gas. The recent increase in coal-fired electricity generation is mostly due to economic growth in China and India and the shutdown of nuclear power plants in Europe and Japan.

Promising technology, but difficult economics

Carbon capture and storage (CCS) is a technology for removing CO2 from the exhaust gas of power plants and storing it underground or in the ocean. The cost of capturing and storing a tonne of CO2 ranges from US$23-92 (€17-68). This includes the cost of the energy needed for the carbon capture process (up to 40% of the power plant’s fuel). However, the current price for EU emission allowances (around 4€ per tonne of CO2) is far too low to make CCS economical. Worldwide, there are only eight operational CCS installations, many of which inject the CO2 into operational oil fields to boost oil production.

Carbon capture and storage


EU support for CCS

In the EU, the CCS Directive provides a legal framework, but there are no operational installations.

The EU uses the proceeds from the auctioning of certain carbon allowances (NER300) to finance clean energy projects, including CCS. However, due to the low carbon price, these auctions brought in less money than originally planned. Although no CCS projects were selected in the first call for NER300 projects, the European Commission intends to fund CCS projects in the second call, which has been launched on 3 April 2013.

On 27 March 2013, the Commission launched a Consultative Communication on which outlines the situation of CCS in the EU and asks for opinions on possible policies. Longer-term incentives for CCS may come from a reform of the carbon market leading to higher carbon prices, or from regulatory measures. Without such incentives, the outlook for CCS remains bleak.


2 thoughts on “Hard times for carbon capture and storage

  1. Reblogged this on SMIPP Ltd..


    Posted by smipp Ltd. | April 17, 2013, 16:28


  1. Pingback: The week on the EP Library’s blog: Impact Assessment | Library of the European Parliament - April 12, 2013

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