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27. Title: European Energy Review Headline: CCS in Europe under serious threat Date: 17/11/2011 It foresees a maximum of just 2% CCS in the power sector in 2030, rising to between 7% and 32% by 2050. “CCS, if commercialised, will have to contribute significantly in most scenarios with a particularly strong role of 32% in power generation in the case of constrained nuclear production”, the document says. The key sticking point is “if commercialised”. Today, it is still not certain whether CCS will be commercialised. And industry representatives say that expecting a delay in commercialising the technology to after 2030, as the Commission is doing, does not improve its prospects. “We need to deliver widespread deployment by the early 2020s”, insists Sweeney. “The moment to push is now.”

Carbon capture and storage (CCS) is facing strong headwinds in Europe. EU member states have so far failed to translate an EU CCS law into national legislation. In the UK, a prestigious demonstration project has been cancelled. The European Commission still supports CCS, but sees an important role for it only after 2030. Too late, say beleaguered industry representatives. They fear that the momentum for CCS will be lost and key players will desert their CCS activities if policymakers don’t take firm action soon. “The moment to push is now.” “The next 18 months will be make-or-break for carbon capture and storage”, announced Graeme Sweeney, Executive Vice-President for Future Fuels & CO2 at Shell, at a CCS event in Brussels last week, organised by the Scottish European Green Energy Centre. The man who also chairs the Zero Emissions Platform (ZEP), an industry-led consortium representing the European CCS industry, knows carbon capture and storage (CCS) is at a crossroads. There is a strange mix of emotions at CCS conferences these days: one by one, its supporters stand up and make their case, with defiance, conviction... and bewilderment. The defiance and conviction stem from continued belief that CCS has a future. The bewilderment comes from a dawning realisation that this is far from guaranteed. The European Commission seems unwavering in its support for CCS. At ZEP’s General Assembly in Brussels in October, Philip Lowe, Director-General for Energy at the European Commission said: “We need very much to include CCS in the most favourable pathways to 2050. It’s faster and cheaper if CCS is used, not only on coal but also on gas and for industrial applications.” Thirty gigawatts of CCS must be operational in the EU by 2035, he added. Nevertheless, according to a leaked draft of the Commission’s much-awaited 2050 Energy Roadmap, CCS will not really get going until after 2030. Due to be finalised in mid-December, the Energy Roadmap sets out different decarbonisation scenarios for the European energy sector.

2030 is too late, agrees Mike Farley, Director of Technology Policy Liaison at Doosan Power Systems. “We will lose the momentum, and all we’ve learned now. We will lose the interest of key players.” The recent cancellation of the Longannet CCS demonstration project in Scotland, which had been promised £1bn from the UK government, is a case in point. This did not only end a potentially important demonstration project but closed down a whole CCS R&D team along with it, Farley points out. Other energy companies are reportedly also shutting down CCS R&D facilities, putting at risk the technology’s future development. ZEP published a study this summer that predicts CCS will be cost-competitive with wind, solar and nuclear, in terms of power generated, from the early 2020s. It estimates that post-demonstration CCS will cost €70/MWh for coal and €95/MWh for gas, plus carbon costs for the 10% or so of emissions evading capture. This would render electricity produced by a fossil-fuelled power station with installed CCS competitive with that produced by wind, solar or nuclear, according to IEA calculations, says ZEP. It has calculated the costs of complete CCS value chains, from capture to transport to storage, for new coal- and gas-fired power plants in northern Europe. Unlike most analyses, it uses private, not scarce public, data. But there are several important assumptions underpinning ZEP’s conclusions. One is a successful demonstration programme; two is a handful of large-scale CCS plants built after the demonstration programme that enable vital technological improvements to further bring down the cost. The former is also clearly a pre-condition for the latter. The EU’s CCS demonstration programme is delayed and short of cash, however. Back in 2008, European leaders pledged to build up to 12 CCS demonstration plants by 2015. The goal was indeed to have the technology ready to go commercial by 2020. Earlier this year, industry representatives spoke about 5-8 demonstration plants by 2016-17. Last week, they said 4-6 was probably a more 43


Communications Report 2011

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