Carbon Impact Specialist | ResponsAbility | CH
In one of their last reports IPCC mentioned that without broad implementation of CCUS it will be 140% more expensive to mitigate climate change and not to exceed 2°C warming.
But, what is CCUS?
During the process of power generation with fossil fuels CO2 is emitted to the atmosphere, the term carbon capture, utilization and storage refers to the process of capturing this CO2 from fuel combustion or industrial processes, liquefying it (to make it easier to transport), transport it via pipeline or ship and either utilizing it as raw material in chemical processes or storing it in adequate geological formations.
Source: Global CCS Institute
CCUS is a capital intensive process, also there are risks across the value chain that increase the costs even more, making it not attractive to private investors. This has made difficult for CCUS projects to move beyond the demonstration phase. However there are currently 43 facilities in development, construction or operation around the world.
On the financing side, CCUS needs to be competitive with other technologies without government funding for debt providers to be interested, that’s why the focus is on adding value to the CO2. Governments have a key role to play to de-risk CCS, either by becoming first investors or by implementing encouraging policies such as tax-reductions for low carbon energy or products. Some countries like UK are pushing for the deployment of CCUS in the next decade providing grants for innovation and to finance demonstration projects (UK CCUS deployment pathway). Breakeven cost for CCUS are around USD 40/tonne CO2 captured, this is still above the abatement cost of CO2 using renewable energy which is around 25-30 USD/tonne CO2.
What’s the future?
Trends shows that the costs for CCUS will still go down in the future (Global status of CCS, 2017) and projects will be able to self-finance without public funds. CCUS should be a complement to the deployment of renewable energy generation and could be part of the solution for energy intense industries that cannot be easily electrified. See for example this initiative by TATA steel
Drax’s bioenergy CCUS pilot project in the United Kingdom is capturing CO2 from a power plant fueled by 100% biomass feedstock. If this project is successful it could become the world’s first negative-emissions power station! (IEA).
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