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The Guardian: Firms will act on CO2 only if its cost triples, says Shell

Terry Macalister
Friday February 15 2008

A carbon price close to $100 per tonne of CO2 – more than three times higher than it is today – is needed before industry will invest in the thousands of carbon-capture-and-storage (CCS) schemes needed for reducing greenhouse gas emissions, Shell warned yesterday.

Jeremy Bentham, the vice president of business environment at the company, also called on the EU to quicken the pace of regulatory change and take vital decisions “within five years” that would largely shape the pattern of energy supply and global warming in coming decades.

His comments came as Prince Charles took a similar message to the European parliament in Brussels telling MEPs that business leaders were ahead of politicians and “the doomsday clock of climate change is ticking ever faster towards midnight”.

Shell reiterated the view expressed by many in the business world that the price of carbon – the amount companies must pay for permits to emit CO2 – needed some certainty if vital investment was to be made in a range of technologies necessary to reduce CO2 output. Carbon capture was one of the answers to the problem but needed to be introduced on a huge scale around the world along with renewables, biomass and other forms of energy.

The technology needed in carbon sequestration – whereby CO2 is pumped into storage spaces such as old North Sea oil fields – was already there, said Bentham. What was needed was the right regulatory framework and pricing structure with carbon pricing at “above $50 and below $100 per tonne,” he added. Asked whether it should be closer to $100, the Shell executive said “probably”.

Shell says unless decisions are made within the next five years, the energy sector will be left to “scramble” with a whole range of technologies jostling with each other – leading to price spikes, volatility and uncertainty. EU action, which would set a precedent for the rest of the world, would allow more orderly progress as oil gradually runs out and other forms of fuel take over.

Bentham said the EU needed to be careful about how it made decisions, pointing to potential environmental harm from first-generation biofuels. He said it was “not a smart move” for the EU not to differentiate between different types of biofuels.

He denied that the scenarios he outlined, with a large and continuing role for fossil fuels, were influenced by the needs of a company with huge investments in heavily polluting power sources. and its sister websites,,,,, and are all owned by John Donovan. There is also a Wikipedia article.

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