Business can’t do carbon capture alone

GOVERNMENTS must support the urgent deployment of commercial-scale carbon capture and storage demonstration projects if the technology is to become viable by 2020, a major new report has warned.

The Rudd government’s Global Carbon Capture and Storage Institute last week released an audit of 275 proposals worldwide in light of the G8’s target of 20 fully operational major projects by 2020.

Though it identified 62 projects that could potentially be operating by 2020, the high expected attrition rate suggested as few as 11 would actually make the 2020 target date.

Hence, it was a matter of urgency for governments to help underwrite commercial-scale developments, according to the institute’s chief executive, Nick Otter.

Only accelerated deployment of multiple projects would generate the expertise needed to reduce costs and make the technology viable.

“Accelerating deployment of commercial scale (projects) is the key issue,” Mr Otter told reporters. “Not enough is being done on deployment ... and that’s where governments have to play a role.”

The institute found that carbon capture and storage would typically increase the cost of coal-fired power by between 40 and 80 per cent, necessitating a minimum carbon price of $US60 to $US112 per tonne, levels not envisaged under Australia’s proposed emissions trading scheme until after 2030.

In comparison, natural gas processing costs would rise by only 1 per cent. Unsurprisingly, gas projects accounted for all seven projects already in operation as well as those considered most likely to be operating by 2020.

That is a major concern if CCS technology is to play a major role in reducing carbon emissions, given that coal is used to generate more than a quarter of the world’s energy.

Western Australia is home to three of the six Australian projects on the institute’s list of credible projects, but none will cut the carbon footprint of WA’s electricity generators.

Geo-sequestration at the Gorgon and Browse LNG ventures account for two of the three WA projects, but will export their greenhouse benefits to Asian gas buyers.

The only local generation project on the list, Aviva Corp’s proposed Coolimba coal-fired power station at Eneabba, is effectively dead after state energy retailer Synergy failed to award it a long-term supply deal.

WA’s biggest clean-coal proposal, Perdaman’s $3.5 billion Collie urea project, was a shock exclusion from the institute’s list despite its potential to underpin a geo-sequestration “hub” at nearby Harvey Ridge that could also serve regional power generators.

But Perdaman has applied for Commonwealth CCS funding and membership of the institute.