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The Guardian (UK): Storing up trouble for the future: Burying their CO2 emissions is the great hope for energy companies, but critics are not convinced

Published: Jun 27, 2007

For a world that’s hooked on fossil fuels, it sounds like a godsend: carbon capture and storage. Scrub up that CO2 gas (along with other noxious nasties) before it leaves the flue of the power station. Pipe it somewhere you can store it safely for a millennium or more. Nothing added to greenhouse gas emissions, and carte blanche to keep on burning coal, which the Chinese, most notably, are determined to do.

Worldwide geological storage capacity is in principle enough to cope with 80 times the world’s current annual CO2 emissions from fossil fuels. It has been projected that 20-40% of these emissions could be suitable for capture and storage by 2050. And, by that time, industry enthusiasts think the EU could actually manage to bury away 30bn tonnes – or five years’ worth of its own current emissions.

For all that, CCS could turn out to be an end-of-pipe dream. Unless, that is, the big industry players can see a clear path to profitability over the next 10-15 years. What that means, in the short term, is that government would have to get behind it.

But the announcements in Gordon Brown’s March’s budget, and the energy white paper in May, won’t prompt too many to put eggs in the CCS basket. There’s to be a competition, announced in November, for funding for a demonstration project to be up and running between 2011 and 2014, and there’s a somewhat vaguely worded promise to contribute to the EU’s goal of getting “up to 12” such projects up and running by 2015. It was too little, too late, to dissuade BP from pulling out of one pioneering CCS project in Peterhead (for a gas-fired power station in this instance) on the very day the white paper was published.

Some environmentalists see CCS as preferable to going down the “new nuclear” road. Friends of the Earth “would like to see some carbon capture and storage demonstration schemes in the UK”, says energy campaigner Neil Crumpton, preferably on industrial sites near the coast where sub-sea burial won’t require long overland pipelines.

But critics see CCS as a red herring, diverting both focus and funding from better solutions, and fraught with shortcomings.

“CCS should be way down anybody’s list of priorities,” says Greenpeace UK’s climate campaign manager Charlie Kronick. “CCS wastes even more energy than our current incredibly wasteful centralised electricity, adds around 50% to the retail cost of electricity and is still at demonstration stage.”

To get through this demonstration stage, and on to commercial use, CCS has several issues to resolve.

The international legal position on burying CO2 beneath the seabed is becoming clearer, with an important recent ruling that it’s not contrary to the treaty on dumping waste at sea.

And, in the wake of the G8 summit deal on climate change earlier this month, it’s pretty certain that carbon sequestered in this way will count towards reduction targets in the post-2012 successor to Kyoto 1. Still to be sorted out, however, are tricky questions such as who precisely is legally liable for CO2 held in storage, and for how long. And, most crucially of all, who will pay for it.

While most industrial processes have a saleable end product, CCS has no obvious revenue stream other than the carbon market to give it commercial justification.

David Hone, group climate change advisor at Shell International, says even carbon trading revenues won’t suffice to deliver the first demonstration projects; there will have to be government help, not least to meet infrastructure costs.

Shell is already involved with a couple of CCS feasibility studies, in Norway and Australia, which are currently in the planning stages. The company has the geological expertise to be a leader in carbon storage, and could do well out of it. “We’d use it ourselves,” says Hone, “and we’d have a long-term opportunity to help other people do it” – not just for power generation but other major industrial processes too. But he still sees it as a big risk to move on to the construction stage without more certainty on the policy side.

A spate of proposals for “clean coal” power plants suggest no shortage of other big players keen to enter the fray. Among them are Centrica, with a project on Teesside, and E.ON, with one at Kingsnorth in Kent.

The Carbon Capture and Storage Association, an industry lobby group set up last year, has been “eagerly awaiting a signal from the Treasury”.

But as one industry observer suggests, perhaps the answer should be stick rather than carrot: considering the windfall profits energy companies have been making for decades from laying waste to the planet, arguing they can’t afford to mend their ways now may be just a tad rich.

Roger East is editor of Green Futures

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