What lies in store for CCS?

One of the major challenges limiting large-scale CCS operations at a global level, both in the short-term and in the longer term is the issue of storage. This publication addresses three interrelated aspects of this puzzle.

The first chapter looks at recent experience in CO2 storage activity in various parts of the world. Through case studies, it shows how progress has been made in achieving high-level storage area assessments, as well as at project level, where important practical experience has been gained in storing CO2. The chapter emphasises the fact that determining the feasibility of storing CO2 is a critical step that cannot simply be considered as the last part of a CCS project preparation process. In fact, selecting storage will actually impact the whole project design and so should be addressed right from the start. In addition to storage, the chapter also discusses transport infrastructure questions.

The second chapter proposes steps to develop a more generic and standardised storage capacity evaluation methodology that should yield more comparable assessments. Assessing storage capacity is an important element for a government, as it enables it to ascertain the role CCS could play in its future energy mix. While country- or region-level assessments may improve understanding among industry on prospective storage areas, ultimately each and every storage site requires a very detailed site-specific assessment.

Chapter three discusses some project-level key investment steps that are strongly linked to the process of finding, characterising and developing the storage site. The capital expenditure of a CCS project tends to be weighted towards the capture plant, while project technical risk is dominated by uncertain storage availability. Storage is an important aspect in the process of reaching a final investment decision for any CCS project, an area where further analysis within the financial decision-making process is needed.

Chapter four of this publication helps to shed additional light on industrial GHG emissions and the importance of CCS in this regard. While much of the discussion on CCS to date has focussed on the power sector, and notably coal, IEA analysis shows that one of the major opportunities for CCS is to reduce emissions from a variety of industrial applications, notably in the cement and steel industries that generate GHG emissions as part of the manufacturing process. While there are alternatives, albeit costly, to CCS to reduce GHG emissions from power generation, the alternatives for industry at this point are less evident. The chapter also discusses the specific policy related challenges facing CCS in industrial applications.

Chapter five of this edition discusses CO₂ utilisation. One way to finance carbon capture and storage activities is to find ways to generate revenues that help to offset the cost of the CCS activity. This is particularly important given the reticence of governments to assume fully from its resources – or to impose fully on businesses – the “climate tax or penalty” required for CCS. As a result, there is a lot of discussion around prospects to use CO₂ to generate money, especially in North America (e.g., EOR), and increasingly elsewhere. For example, some recent analysis in China has looked into whether CO₂ can help with water extraction. Unfortunately, the discussion around ‘use’ has suffered from a lack of clarity regarding the varying impacts on climate change mitigation generated by different types of utilisation. Not all CO2 utilisation is alike – hence the need to separate the wheat from the chaff when looking at utilisation through the climate change prism.