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‘Leaked’ paper may pave way for revitalised CCS policy for Europe

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The European Commission is preparing to seek member states’ views on the future of carbon capture and storage in Europe, as an unpublished draft policy paper “leaked” last week confirms.

The long-overdue document will form the basis of a forthcoming public consultation on the role of CCS in decarbonising Europe’s power and industrial sectors. It describes proposals for reinvigorating moves to deploy CCS across Europe, while underlining the EC’s commitment – both financial and regulatory – to CCS as “the only available technology” that can significantly reduce CO2 emissions at facilities which burn fossil fuels.

This latest development follows recent widespread dismay when CCS initiatives failed to win a share of the EC’s €1.2 billion NER300 fund for developing innovative low-carbon technologies. The International Energy Agency then kicked off the new year by renewing its calls for action on CCS as a “critical element” in a world still dependent on fossil fuels.

So what proposals does this latest paper set out, and could they pave the way for the demonstration and eventual switching on of large-scale CCS initiatives across Europe’s member states?

A continuing commitment to CCS

The draft policy begins with an analysis of fossil fuels as part of Europe’s energy mix, both now and in the future. And it makes the timely point that, despite coal playing an increasing role, many coal power plants are reaching the end of their lives – leading operators to eye new, unabated (under current legislation) gas facilities to avoid costly refurbishments. But, from a climate perspective, gas must also deploy CCS in order to take care of emissions (read ENGO Network on CCS blog, Dash for Gas – No Climate Cure Without CCS).

The paper also points to the strong case already made for CCS in a number of key reports, from the IEA’s Energy Technology Perspective (2008) to the EC’s own 2050 Energy Roadmap, as well as the need for Europe to maintain a market lead in the technology, as “any delay in CCS developments in Europe will also negatively affect those business prospects” – business that could capitalise on non-EU demand in countries such as China, which is responsible for 48% of global coal use.

An overview of the state-of-play of CCS development in Europe makes for sobering reading – despite making steady progress in technology, investment and legislation over the last 15 years, none of the eight full-scale CCS projects currently being developed are on European soil. The draft paper blames, among other factors, a lack of economic incentive for developers due to a low carbon price, and a black hole that was meant to have been filled by public and private funding. A higher price on carbon is also the main recommendation from the ENGO Network on CCS report presented at COP18 in Doha in December (read the report here).

Revitalising efforts

Accepting that the EU is unlikely to meet its target of 12 large-scale CCS demonstration projects operating by 2015, nevertheless, the draft paper calls for an urgent policy response to revitalise CCS. It warns that the technology must be “demonstrated now and deployed after 2020 to get on a cost-efficient decarbonisation pathway”. The draft then sets the ball rolling with a number of proposals, which must ultimately be decided by member states.

- As a proponent of CCS, ZERO believes this offers an unparalleled opportunity to step up efforts to encourage a much wider debate on the safe, effective and timely deployment of CCS in Europe, and the rest of the world, says Camilla Svendsen Skriung political adviser CCS globally

One of the key questions raised is whether to legislate for an Emissions Performance Standard (EPS) for energy-intensive facilities or introduce a Mandatory CCS Certificate scheme, which would require carbon emitters to buy certificates that cover a percentage of their emissions.

Each approach raises its own concerns, as reported in the media last week following circulation of the draft policy. Any use of the EPS would have to employ a limit that would bring gas power plants under its jurisdiction as well as coal – in other words, a level of around 100-150g CO2/kWh. The UK’s current proposal within its recent Energy Bill proposes 450g CO2/kWh, which critics have attacked as opening the door to unabated gas use for decades to come.

Meanwhile, the renewables sector may oppose a mandatory CCS certificate scheme, which would create a level playing field to support all low-carbon technologies, irrespective of type – a move that would, conversely, be welcomed by CCS developers. In which case, it is imperative that the scheme is designed to promote both without prejudice.

The paper also highlights the need for member states to agree policy that addresses the financial gap, and stimulates investment in not just individual demonstrations and full-scale projects but the infrastructure that they need.

Other questions raised include whether member states with high levels of fossil fuel use should be obligated to develop a roadmap that leads to a low-carbon electricity sector of nuclear and renewables, or instead a national strategy for CCS deployment on coal and gas. And how might countries increase public acceptance of CCS – Germany, for example, has struggled to get the EU CCS Directive transposed due to public resistance. The draft also asks whether power utilities and industry should be obliged to fit CCS-ready equipment for all new investment “to ease the necessary CCS retrofit”.

When this policy is eventually published, its content is expected to be viewed as controversial. However, ZERO believes this is essential to sparking a full and productive debate among member states and the wider public in order to drive Europe forward into a carbon-free future.

- We need stronger and more effective measures to ensure the needed fast deployment of large scale CCS in EU, and globally. This means “carrots” like the NER300 funding. It also means “whips” like mandatory CCS, EPS or even a CO2 tax. ZERO finds the content of the draft promising, and welcomes its analysis and suggestions for a better framework for CCS as one of several solutions to mitigate our CO2 emissions and fight climate change, Skriung concludes.



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